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Celebrated actor's estate plan comes under scrutiny

Another actor with strong New York ties is leaving behind both a professional legacy of high merit and questions surrounding the distribution of his personal estate.

Stories focusing on celebrities are often written, of course, with an eye on their pure entertainment value for readers. As is sometimes the case, though, and precisely because celebrities are widely known public figures, tales of their personal lives can resonate with readers in singularly meaningful ways.

In other words, what happens to them can often be just as likely to occur with individuals and families that are far less "public." Media reports concerning their activities can present relevant information that is both instructive and can be acted upon purposefully by many people across a large audience.

For example, actor James Gandolfini suddenly passed away last year. In the wake of his death, many financial commentators weighed in with views that criticized his executed estate plan. Reportedly, Gandolfini left that IRS with many millions of dollars that could have gone to his family had he implemented different planning strategies.

Many readers have certainly noted the recent passing of acclaimed actor Philip Seymour Hoffman. With an almost déjà vu-like quality that harkens back to Gandolfini, financial writers are pointing out alleged flaws in Hoffman’s planning that will likely confer millions of dollars on federal and state tax authorities rather than on Hoffman’s loved ones.

Hoffman never married, leaving a large devise to his long-time girlfriend via a will rather than through one or more trusts. That will result in a large chunk of money ending up in government hands. Moreover, Hoffman never updated his will to account for two daughters he had with his partner, providing only for his son through a trust.

Hoffman’s estate plan will likely receive heavy scrutiny in the media going forward, and what the actor did -- and did not do -- will potentially have instructive value for many readers.

One central takeaway point from the emerging details stresses the need for any person seeking to transfer wealth to solicit the assistance of an experienced estate planning attorney.

Source: DailyFinance, "Philip Seymour Hoffman's 3 biggest estate planning mistakes," Dan Caplinger, Feb. 25, 2014

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