By Laura L. Fike
Principal Consultant, Strategic Funding Solutions, LLC
Aretha Franklin, the undisputed Queen of Soul who taught us about RESPECT, died from pancreatic cancer on August 16 of last year at age 76. The shock that followed the sad news of her passing was that she died without a will or trust. Her estate, estimated to be worth more than $60 million, will now be tied up in probate court and will be subject to federal estate tax (up to 40%), as well as inheritance tax.
Without the direction and asset protection that a will or trust would have provided, the state of Michigan, where Ms. Franklin resided, will determine how and when what remains of her fortune is distributed. Probate court can move slowly. Heirs may wait for years to receive their inheritance.
Earnings from decades of singing out her heart and soul will not go to friends, churches, and other organizations and causes that Ms. Franklin may have wanted to benefit from her estate. And her extended community will not be able to put the generous gifts her estate could have provided to good use.
The vast majority of individuals will not be subject to federal estate and inheritance taxes. Estates of less than $1.2 million for individuals and $2.4 million for married couples (2018 level) are exempt. You may live in a state which is exempt from state estate tax. What we stand to lose if we do not have a will or trust is control of what we worked so hard to earn during our lifetimes. Probate court will not know that we cared about churches, schools, or other nonprofit organizations such as the National Association of Teachers of Singing (NATS) and the NATS Foundation.
Perhaps it’s time that you consider how you want to leave a legacy that benefits the people you love and the organizations that have earned your trust. If you have already created an estate plan that benefits NATS, please let us know. Call Laura Fike, who now serves NATS as a fundraising consultant, at 937-305-5886 or email Laura@nats.org to request a confidential estate disclosure form or to discuss your possible interest in making a planned gift.
Editor’s note: This article does not constitute financial or legal advice. Please consult with your financial and/or legal advisors to determine what is best for you.