Music icon Prince passed away in 2015 and left behind a large estate. Unfortunately, his failure to have a solid estate plan means that any potential beneficiaries will be walking away with far less than they could have. Prince's estate is still in the probate process, and this could take several years to sort out. What is clear, however, is that the IRS will be walking away with a lot due to a lack of asset protections. Massachusetts residents, regardless of the sizes of their estates, can learn from this the importance of estate planning.
According to the laws of the state in which Prince lived, as he was single and did not have any children -- that he was aware of -- his estate is to be distributed to his siblings. To date, numerous claims have been made against the estate. Tax claims are among them.
Prince's estate is estimated to be worth approximately $200 million. Tax claims on the estate will leave beneficiaries with about half of that. Of course the cost of probate and other fees will reduce the amount that will finally be distributed even further.
Not all estates are as sizable as Prince's, but that does not really matter when it comes to safeguarding one's assets. A lot can be lost during the probate process to creditor and tax claims if the appropriate steps are not taken to protect one's assets and beneficiaries beforehand. An experienced estate planning attorney can assist Massachusetts residents with preparing wills, establishing trusts and putting together estate plans that will offer the protections desired. This can include shelter from certain taxes.
Source: twincities.com, "Poor planning means government will take half of Prince's estate", Steve Karnowski, Jan. 17, 2017