We constantly tell our clients to make sure their loved ones and interests are protected through estate planning. The six-year legal battle that took place over Prince’s estate clearly demonstrates the importance of estate planning.
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The failure to draft an adequate estate plan can be costly and emotionally draining for family members.
Prince died with a $156 million estate, but no estate plan or will to determine how the estate should be administered.
What happened?
Because he did not have an estate plan, his family was embroiled in a costly six-year legal battle regarding the estate.
Prince died without a spouse or living children, so Minnesota law determined that his estate would pass to his six half-siblings. However, his family could not agree on a distribution plan, leading to expensive hearings and legal proceedings.
Ultimately, the judge split roughly $6 million between two legal entities Prince Legacy LLC and Prince OAT Holdings LLC.
Prince Legacy LLC is owned by three of Prince’s half-siblings and advisors.
Prince OAT Holdings LLC is owned by music publishing company Primary Wave. It was previously owned by the other three of Prince’s half-siblings and other entities.
Comerica Bank & Trust was assigned by the court to administrate the estate’s affairs during litigation. Comerica Bank will receive $3 million to pay the costs and expenses associated with closing the estate.
What can you do to prevent a similar outcome?
While most of us do not have the same assets as Prince, this lengthy and costly litigation shows the importance of estate planning.
To avoid costly fees and large portions of your estate going to pay costs, taxes and appointed administrators, it is essential to have an estate plan.
Even a simple estate plan can help to prevent significant losses and disputes among family members.
If you don’t have an estate plan in place or you think it’s time to update yours, contact us today.
Contact us today to help you get the right documents in place or to update your current estate plan. We will plan so that you don’t have to worry about your future.
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