Hollywood has no shortage of cautionary tales, even when it comes to Estate. Celebrities like Aretha Franklin, Chadwick Boseman, Prince and Robin Williams all had family members in Court due to poorly prepared or nonexistent estate plans. Anne Heche and Lisa Marie Presley are the most recent examples of high-profile conflicts over celebrity estates.

Months after the deaths of both stars they were still making headlines because their families were fighting over control of the Estates. Heche’s 20-year-old son and her former partner fought over control of her estate because Anne Heche did not have a last will and testament. Heche’s former partner relied on an email from 2011 to Heche’s lawyer stating that she wished for her partner to control her estate for the benefit of her children. He also argued that Heche’s 20-year-old son was too young to administer the estate. Ultimately, after four (4) months, the Court imposed California’s intestacy laws and confirmed that Heche’s son would administer the estate.

Lisa Marie Presley’s mother, Pricilla Presley, and daughter, Riley Keough, went to Court to determine who should be trustee of Lisa Marie Presley’s estate, which was held entirely in trust. Pricilla Presley was originally named trustee, then some years later, the trust was amended to name Riley Keough and her brother (who predeceased Lisa Marie) as trustees. The crux of the argument was over the legitimacy of the document naming Keough and her brother as trustees. Some of the issues with the document were that it only existed as a PDF copy, not an original; Pricilla was not notified of her removal as trustee, which is required under California law; there were no witnesses or notaries; and there was a question over whether the signature was legitimate. Seven (7) months and many court hearings after Lisa Marie Presley’s death, the administration of her estate was settled out of court.

Sadly, Heche’s situation is not unique. According to some estimations, 68% of Americans do not have a Will.[1] As you can see from Anne Heche’s situation, the lack of a Will can become a major problem for the family that you leave behind, especially if any family members disagree as to who should be in charge of your estate. The best and most effective way to manage your estate is to execute a Last Will and Testament, which sets forth your wishes for your property, and even the care and custody of your children, upon your death.
As was evident in the case of Lida Marie Presley, it is especially important that your Will, and other Estate Planning Documents, are prepared and executed in accordance with the laws of the state in which you reside at the time of your death. In New Jersey, there are specific statutory laws that must be followed in order for a Will, Trust, Codicil, etc. to be legitimate and “self-proving” in the eyes of the Court. Prepared and hand-written documents have different requirements under the statute. If there is any question over the legitimacy of an estate planning document, it invites conflict. The best way to avoid this conflict is to have an attorney prepare your estate plan.

Family disagreements are not unusual, same is true when a loved one dies. Recently, our firm had to resolve a case that involved a disagreement as to the funeral control of a deceased family member. This disagreement caused the funeral home to delay the funeral process for over two weeks! If you do not arrange your funeral before your death, you can set forth a funeral agent in your Will to take control of the planning of your funeral and avoid any disagreements or delays.
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Be sure to put your wishes down on paper, putting it off until a later date that may never come could result in turmoil for your family while they are still grieving. If you already have a Will, take some time to make sure complies with the statutory requirement and make sure it is up to date.
Give yourself some peace of mind and lay out an effective plan of action for your family. Contact Hunnell Law Group today to start your Estate Planning. https://www.hunnelllaw.com/contact


[1] https://theconversation.com/68-of-americans-do-not-have-a-will-137686; https://www.caring.com/caregivers/estate-planning/wills-survey/; https://www.aarp.org/money/investing/info-2017/half-of-adults-do-not-have-wills.html
 

Divorce is challenging enough, trying to decide how to divide assets and establish a fair amount of support. The last thing you might want to think about is taxes. But it is equally important to understand the tax implications of your decisions (or indecisions), as they can save you from future headaches and financial strain. Here are some essential tax tips to consider:
 
During your divorce you should consider these practical tips:
Handle Property Transfers Correctly
Transfers of property between spouses as part of the divorce are usually non-taxable events. These types of transfers are generally specified in the Marital Settlement Agreement. However, you must work with your plan provider or real estate attorney to ensure the transfers are handled correctly.
 
Choose the Right Filing Status
Your marital status as of December 31st determines your filing status for the entire year. But, even if you’re entitled to file joint, you should still consider whether filing jointly or separately makes better financial sense. If you’re living separate and apart, you may also want to consider whether you file as head of household (instead of married filed separately).
 
Don't Forget About Retirement Accounts
Dividing retirement accounts can have tax or other financial consequences, if not properly transferred. For example, you may incur penalties if you liquidate a retirement account, instead of having it transferred directly to your spouse by way of a Qualified Domestic Relations Orders (QDROs). Most important is to ensure the language in your Settlement Agreement regarding how these types of assets are to be transferred is specifically articulated, which should include language that confirms the asset is being transferred through a “tax-free rollover”, for example.
 
After your divorce, these essential tax tips are a must:
Update Your Withholding
Change in your marital status usually means a change in the tax withholdings outlined on your paycheck. To ensure you have made the correct election, file a new Form W-4 with your employer to reflect your current situation.
 
Real Property Transfers
Usually the marital home (or other real property) is transferred post-divorce. When transferring real property in New Jersey, you must be aware that there is a ninety (90) day timeframe to complete the conveyance, if you want to be exempt from the realty transfer tax. Meaning, the Deed must be recorded within 90 days of the divorce being final.
 
Understand Alimony Tax Treatment
Alimony and spousal support established after 2018 are not tax-deductible for the payer and are thus not taxable to the recipient.
  
Claiming Dependents
The custodial parent generally has the right to claim the child as a dependent. However, we routinely see parents alternating the dependents or if there are more than one, splitting them. In that event, the parties must agree and must file the appropriate form.

Please note that these tips are just that, tips and general information. This is not tax advice.  What you should do in your situation, depends on the specific facts of your case. Also, keep in mind, most divorce lawyers (HLG included) are not tax lawyers, so if you are unsure what to do, we encourage you to seek professional advice from a tax expert. Tax laws are complex, and getting professional advice can be invaluable during this transitional period.
 
This blog post published in April 2024 provides a starting point for individuals think about taxes during divorce. Tax laws change overtime, so staying updated is crucial.