Don’t Be Like Aretha Franklin

Aretha Franklin, the Queen of Soul, died recently. Although she had an estimated net worth of $80 Million and a number of assistants and advisors, she reportedly did not have a written Will.

Under Michigan law, her estate will be distributed to her four sons. But, first her estate will have to pay approximately $28 Million in federal estate taxes. And nothing will be distributed to her beloved church.

Aretha Franklin did not have a written Will.

With estate planning and a written Will, Aretha could have provided very generously for her church, made provisions for her grandchildren, given bequests to other people important in her life, taken care of her sons for the rest of their lives, and reduced the amount paid in federal estate taxes.

Prince, the singer, reportedly did not have a written Will either. He also left a multi-million dollar estate. However, his family tree is not as traditional as that of Aretha Franklin. The opportunity to reduce the millions of dollars of estate taxes and avoid estate litigation was lost when he died without a written Will. It may be several years before his estate is finally settled.

With the increase in the federal estate tax exemption in 2018 to $11,180,000 per person ($22,360,000 for a married couple), more than 99% of the U.S. population no longer has to worry about federal estate taxes having to be paid from our estates when we die.

For those of us who live in Maryland there is also a Maryland state estate tax. The 2018 exemption from Maryland state estate tax is $4,000,000 (it will be $5,000,000 per person and even higher for a married couple beginning in 2019). The exemption is the amount that can be given to non-spouse beneficiaries before any estate taxes have to be paid. Any amounts left to charity or to U.S. citizen spouses are also estate tax-free.

Even though estate tax considerations are no longer the pivotal/essential/main/key reason for estate planning and a written Will, it is still very important that your wishes control the distribution of your assets. With a written Will, you get to decide who the Executor will be, who gets what, to provide for unique family situations, and to have the peace of mind that you have not left a mess and unnecessary expenses and taxes behind.

By Jerry Gimmel, Esquire, and Leah Morabito, Esquire

Jerry Gimmel and Leah Morabito are partners at the Gaithersburg law firm Gimmel, Weiman, Ersek, Blomberg & Lewis, P.A., and primarily work with estate planning and probate.

www.gweblaw.com
(301) 840-8565

By | 2018-09-25T12:11:43+00:00 September 24th, 2018|Estate Planning, Featured Articles, Gerald K. Gimmel, Leah B. Morabito, Legal Information, Recent Posts, Trust & Estate Planning, Wills|Comments Off on Don’t Be Like Aretha Franklin