The Queen of Soul Joins the List of Celebrities Who Died Without an Estate Plan.

Aretha Franklin, the Queen of Soul, beloved by millions, died recently at the age of 74. Unfortunately, like two other musical geniuses, Amy Winehouse and Prince, Aretha Franklin died without a will. Ms. Franklin left behind four sons, one of whom has special needs and an estate, estimated at approximately 80 million dollars.

Because she did not prepare a will before she died, there are hurdles ahead for her children.

  1. First, the estate will have to determine the heirs under the laws of intestacy in her home state. The estate will reportedly be divided among her four sons. 
  2. Second, there will probably be taxes to pay. Ms. Franklin's estate appears to have been well over the $11,180,000 individual estate tax exemption. If so, the estate will have to pay a 40% federal estate tax tax on everything over that amount. (This was an estate that cried out for tax planning.)  
  3. Third, there could be major delays. If anyone claims a share of the estate or claims to be owed money from the estate, the process to administer and close the estate can take years - as it has with Prince's estate. With an estate this large, the risk increases that there will be people coming out of the woodwork to try to get a piece of it. When there are delays due to frivolous claims and challenges, the rightful beneficiaries of the estate lose. 
  4. Fourth, the estate will be administered in full view of the public. Had she created a trust like Burt Reynolds, Ms. Franklin could have kept her estate details private.
  5. Fifth, and last - but not least, Aretha Franklin had a son with special needs. I don't know if Ms. Franklin's son received any type of government benefits for people with special needs, so I cannot speak about his particular situation. All I can say is, in general, inheritances given outright to an individual with special needs can be taken by the government to pay back the cost of services already received. Outright inheritances can also disqualify individuals from benefits they are currently receiving and from future benefits. These benefits consist not just of money - but also of vital services, such as assistance with activities of daily living, and training programs. An interruption in these services can be devastating. These services can be difficult or impossible to duplicate on a private-pay basis.

When proper estate planning is done, risks can be minimized and inheritances can be preserved to supplement government benefits rather than supplant them. All parents and close family members of special needs individuals should be aware of the problems caused by leaving an inheritance outright to someone with special needs. 

Given the challenges they face, I hope Aretha Franklin's children will not have to wait years for their inheritance. But, as they say, hope is not a strategy. What Aretha Franklin needed was an estate plan!

If you have decided not to leave your family's future to chance, call 704.887.5242 or fill out the contact form today to get started on your estate plan. 

Image: Shutterstock/2jenn

 

 

Nancy Roberts
Connect with me
Handling All of Your Family's Estate Planning Needs
Be the first to comment!
Post a Comment