Perhaps dealing with a lot of wealthy people in Hollywood or New York is what left a certain disgust in actor Philip Seymour Hoffman's mouth. He grew to despise what he called "trust fund kids" and did not want his children to become them.
Unfortunately, this aversion caused Hoffman to forgo hiring an estate planning attorney, in favor of an accountant who created a will for him.
The will left his $35 million estate to his girlfriend Mimi, who is the mother of his three children.
The big estate planning mistakes are Hoffman’s decisions not to marry Mimi and to use an accountant for a will. In the end, Hoffman’s estate did not have the benefit of the unlimited marital deduction. This cost his family $12 million in estate taxes alone, as Kiplinger points out in "Philip Seymour Hoffman's $12 Million Estate Planning Mistake."
Hoffman should have considered visiting with an estate planning attorney who could have explained the consequences of Hoffman’s circumstances, while he was still alive.
Hoffman could have told the attorney about his fears. He could have had the attorney design a specific estate plan to use the unlimited marital deduction with incentive trusts to ensure that the Hoffman children would be less likely to become trust fund dependents.
Do not make the same mistake that Hoffman did. When you want to plan for your estate, talk to an estate planning attorney.
Reference: Kiplinger (July, 2017) "Philip Seymour Hoffman's $12 Million Estate Planning Mistake."
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