Estate planning is a topic that most individuals gradually begin to think about as they age. Decisions regarding who should receive what assets and how much to leave to others should be made while the individual is still capable of making these decisions. By carefully crafting an estate plan, Nevada residents can avoid some of the pitfalls that have become evident in Philip Seymour Hoffman’s estate planning strategy.
When it comes to the transfer of property after the death of the individual, married and unmarried individuals are not treated equally. Philip Seymour Hoffman and Mimi O’Donnell were together for an extended period of time and even had children together. However, since they never married, assets over the estate tax exempt amount will be subject to estate taxes. A simple way to avoid this tax issue would be to legalize the union between the individuals, depending upon other circumstances and desires.
Another issue that came to light in Philip Seymour Hoffman’s estate plan is the need to modify the will as circumstances change. At the time his will was drafted, he only had one child. However, as time went by, other children were born. Modifications to the will were not made; therefore, these children were not specifically named in his will.
Estate planning is designed to ease the financial and emotional burden on the grieving family. Prior planning and then subsequent modifications as necessary can help the Nevada family transition from one phase of life to another. By learning from the mistakes of others, a well-crafted estate plan can ensure that the individual’s wishes are honored.
Source: dailyfinance.com, Philip Seymour Hoffman’s 3 biggest estate planning mistakes, Dan Caplinger, Feb. 25, 2014