Prince Left a Legacy but No Will
The legendary Prince truly was a genius! Most of us know that he was an incredible musical talent. But since his sudden passing, we are now learning that he was a humanitarian as well. We know that he quietly gave a series of concerts to benefit communities in need. We know that, without any fanfare, he held a concert in Baltimore after the murder of Freddie Gray. The breadth of his service may not ever be completely known.
Prince lived a private life. He was a man who lived a life without needing recognition for his service. He lived a life spreading joy. If more people lived that way, what a wonderful world this would be!
However, we have also heard that Prince did not prepare a will. We will never know why not. The headlines report that his family is already at war as a result of the potential inheritance. I know this would hurt his heart.
The headlines are also saying that there are “love children” springing from the woodwork. What a circus and contradiction to the very private life that Prince led.
In my professional experience, I have witnessed many with much less of an inheritance go to war. In Prince’s case, the stakes are high. His estate is liable to pay an incredible amount—an estimated $120 million in federal and state estate taxes will be due. The balance will then be split among his siblings (those full and half) as well as descendants of siblings who predeceased him. That number is a conservative estimate of $250 million in assets. The federal government applies a tax upon an estate that exceeds $5.45 million dollars and Minnesota tax is levied on estates with values of over $1 million. If Prince had acted differently, these weighty tax bills could have been minimized through strategic planning.
As a private man, Prince created not for profit organizations that provided support for the people and communities that were most vulnerable. Had he lived, his philanthropy could have been supported for years.
In keeping with his privacy, the creation of a Trust or Trusts would have maintained the private distribution of Prince’s assets. A Trust is a legal concept. It is often used in estate planning to facilitate ownership, management and distribution of property while avoiding probate.
The Trust is also a private document. When properly drafted it can minimize estate taxes; maintain ownership of assets with controls that go beyond the life of the grantor. Trusts can be “revocable” and “irrevocable.” Trust terms should be established in a manner that honors the values and desires of the distribution of assets.
Yet, the attorneys will make a great deal of money in the battle to distribute Prince’s assets to folks who may not care about the Man, the Music or his spectacular Legacy.
Don’t accept this as your planning scenario. Protect your legacy. “Write the vision and make it plain so that those who see it can run with it.” Habakkuk 2:2