Large sums of money, extreme attention from fans and the stress of living life in the public eye often work together to result in poorly thought out estate plans. The result can be will executions that play out on the public stage, higher than necessary tax liability and unintended consequences for heirs. As Trial & Heirs reported, the late Philip Seymour Hoffman's estate suffered from just these critical problems.
According to Forbes, it appears that Williams created at least two different trusts. His two valuable pieces of real estate are held in the name of the "Domus Dulcis Domus Holding Trust," the Latin translating to "home sweet home." This trust names Hollywood producer Stephen Tenenbaum and New York accountant Joel Faden as trustees. By transferring the ownership of his real estate into a trust, Williams was able to avoid the substantial estate tax rate that would otherwise become due upon his death.
Williams also created another trust in 2009, according to TMZ. This trust, which the news source managed to obtain a copy of, entitles his three children, Cody, Zelda and Zachary, to equal sums. These sums were in turn split into three equal payments to be received at the ages of 21, 25 and 30. This allowed Williams to pass on his fortune without worrying about the high estate tax or that his heirs would squander their fortune young.
One further benefit of creating a trust rather than a will is that trusts can remain private when not leaked and published, like the one reported on by TMZ. This is distinct from wills, which become public domain.
As a tax attorney, I've written extensively about organizing your own estate planning. Check out some of my most recent posts on this subject:
- Estate Planning Essentials
- Estate Planning With A Non-citizen Spouse
- Faltering on Estate Planning Can Lead to Thorny Wealth Transfer Issues
- Estate Planning Acronyms for the Remainder of 2012