New York residents who were fans of Prince likely remember that he died in April 2016. They may also know that he died without a will, which has made it more difficult for his heirs to receive their inheritances. At his death, Prince’s estate had an estimated valued of about $200 million. However, the IRS and the executor of his estate cannot agree on exactly how much the estate was worth when the singer passed away.
Until this has been determined, the executor cannot distribute assets to beneficiaries. If Prince had a will, assets would have been distributed to heirs in accordance with his wishes after creditors had been paid. However, since he had no will, it has resulted in an extended probate process. The longer that probate continues, the more expensive it will be, and the money used to pay those expenses will come from whatever assets the estate has.
So far, attorneys fees have totaled $5.9 million with another $2.9 million in requests to pay additional expenses. It is not known how much has been paid in taxes to the state of Minnesota and the IRS. To avoid probate entirely, it may be worthwhile to put assets into trusts that are held outside of an estate. That can increase the possibility that beneficiaries will receive most of their inheritances.
Creating an estate plan with a valid will or trust may make it easier to reduce or eliminate the impact of probate. Typically, a valid will does not get challenged in court. An attorney could help a client create estate plan documents or review those already created. This may ensure a smooth distribution process in the future.