Why Prince Needed a Trust in the Event of His Death
- April 26, 2016 - Celebrity Estate Battles, Estate Planning,
Today, just six days after the death of Prince, a number of news outlets report that Prince’s sister is filing legal documents requesting that she be appointed the special administrator of her brother’s estate. What does this really mean?
If Prince died without a Will then his assets that are not otherwise disposed will pass by way of Minnesota’s laws on intestate succession. Since Prince did not have a child, spouse or surviving parents Prince’s estate will be divided between his surviving siblings.
News stories suggest that Prince had sophisticated legal and financial advisors over his professional life span. Given this level of advice, it is extremely unlikely that Prince did not have a Trust that held or would hold his assets upon his death. Prince in fact likely had two kinds of trusts.
A revocable living trust would allow Prince to make changes to the trust during his lifetime and trust assets would transfer at his death.
Prince may have also had an irrevocable living trust – a trust set up to reduce income or estate taxes. These types of trusts are separate legal entities for tax purposes and assets cannot be removed nor changes made by the maker after the creation of the trust.
Prince worked hard for his money. It is unlikely that he failed to engage professionals who would work hard to protect it.
Prince likely had a living trust and an irrevocable trust. These trusts likely held most of his assets.
The simple truth is that the full nature of Prince’s estate plan will not be known for a while. For now, I suspect, Prince’s advisors are getting to work on his estate. This work will focus on protecting current assets and preventing harm to future assets.
Prince’s estate will likely make the Forbes annual list of the Top-Earning Dead Celebrities. This group includes the estates of Elvis Presley, Michael Jackson, Bob Marley, Charles Schulz, Elizabeth Taylor, Marilyn Monroe, John Lennon, Albert Einstein, Paul Walker, Bettie Page, and Theodor Geisel (Dr. Seuss).
If you remember one thing about Prince’s estate, the story is not yet over.
Attorney Michael Hackard
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