There are many things in life that the average person in California does not want to do; however, it is important that some of these things are addressed. For instance, many do not want to pay bills or taxes, but if these items are not paid there could be serious financial repercussions. Likewise, if one does not plan for the end of life and the best method for protecting assets, there could also be serious financial repercussions.
This past April, music icon Prince passed away. Prior to his death, Prince had amassed an estate worth approximately $200 million. Unfortunately while building such a large estate, he failed to plan for its disposition upon his death. Prince died without a will, trust document or any other form of estate plan. As a result, it is likely that the government will be the one to benefit; estates valued over $5.45 million are subject to the federal estate tax of 40 percent.
A little bit of planning would have gone a long way in protecting assets within the estate. A will would have allowed Prince to specify which of his relatives and favorite charities would benefit from his death. Furthermore, through the use of a trust, these assets could have been transferred without the need for probate and court involvement.
While the average California resident does not have an estate of this magnitude, the need for protecting assets and estate planning is still there. Proper planning will allow the individual to specify exactly who should benefit upon one's death and help to avoid the financial repercussions that come with not planning. Experienced legal counsel can help guide one through the process and assist in protecting assets.
Source: singersroom.com, "The Government May Take Half of Prince's $200 Million Estate", Jan. 17, 2017