Almost as soon as it was published, Michael Jackson’s will raised more questions than it answered. While he provided, on the one hand, ideas about what kind of documents a high-profile professional should have, he also points out why every person should have professional guidance in estate planning.
He appointed his mother Katherine as the guardian of his children, arranged for Diana Ross to be the successor guardian if Katherine was unable or unwilling to become guardian, and appointed all of his assets to be placed in his trust.
Any will is a matter of public record, as evidenced by the attention it has received. However, a trust bypasses the estate (but not the estate tax/planning process) and allows certain things to remain private.
Ordinary people should realize that if they die without a will (called an “in testate”), Ohio State Probate Law provides for property to be divided by lineal succession; in other words, your next closest living relatives, whether you want them to or not, can get what you leave behind.
If you don’t have much to leave, maybe you don’t mind. However, if you have any assets to distribute, you’d better consider the question of how you want those assets to be transferred to others.
Michael had substantial assets, which will be subject to 45 percent federal estate taxes, as well as the settlement of debts that were pending from his lifestyle. After having to liquidate some of the assets and depending on how much life insurance is in your life insurance trust, you may still have a large tax to pay, particularly after the expenses that will be involved in inventorying the assets of the entire estate. which will become part of the trust.
If the net worth is valued at $300,000,000.00, the estate taxes that could be owed could be as high as $131,969,200.00 after the $3.50 million exemption and the $1,455,800 credit. If your insurance trust has been adequately funded, it will replace or finance the payment of estate taxes and provide liquid assets to replace your estate.
The point is, unless you have a full estate planning team, including an attorney, certified public accountant, and insurance professional, you might as well be in bad shape.
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