Even the wealthy have financial issues after they pass away. Tony Bennett died in July 2023 at the age of 96. He was best known for his elegant singing style and the love of his family. Before he passed away, Bennett had established an estate plan with a trust to leave his assets to his loved ones. Unfortunately, there were problems and disputes arose, and the estate is in probate dispute. But two of his daughters are now involved in estate litigation. Kiplinger recently shared Johanna and Antonia Bennett’s experience with inheritance disagreements and their advice on how you can build your estate plan and trust and avoid probate issues a bit better than their father. You don’t need to be an extremely high-income family to learn how to avoid estate litigation.
An estate plan can consist of several legal documents, including a will or trust, power of attorney and a healthcare directive. It must also consider your retirement accounts and life insurance. But let’s look at the difference between a will and a trust. A will goes into effect as soon as you pass away, whereas you can implement a trust immediately.
If you have a small estate, a will may be ideal, but there are still some disadvantages to a will:
On the other hand, creating a trust allows you to transfer current ownership of your property into the trust. You can still use all assets, but they may be protected from taxes and debt collectors. A trust gives you the freedom to manage your assets during your life and then immediately transfer them to your beneficiaries after your death. And with a revocable trust, you can make changes as needed.
One disadvantage to a trust is the initial cost of establishing the trust and naming a trustee. You incur this cost, but it saves your loved ones money after you pass away.
If you choose to build a trust in your estate plan, Tony Bennett’s daughters have 4 tips to help you avoid estate litigation.
In Tony Bennett’s case, he had to establish a trust that took his blended family into consideration. His first two children are older than his following two children, so there are different lifestyles to consider. When choosing a trustee, one option is to have co-trustees from each side of the family. Then, you can have a neutral third party person to act as a tie-breaker when a dispute arises. Having co-trustees may be one way to avoid litigation after you are gone.
If you do not want to put your loved ones in the position of dispursing your assets to everyone named in the trust, you may want to consider a professional trustee. This is often an option with or without blended families. You may have one beneficiary who is quite controlling and may make their own decisions rather than follow your written wishes. In any case, a professional trustee is not a beneficiary and has no personal interest in the transactions. Using a professional is often more critical in Tony Bennett’s case since he was a high-profile person with an extensive estate that includes the intellectual property of his music that will earn money for years to come. Having a professional in charge may help alleviate disputes between beneficiaries. This way, they know that one side is not trying to exclude anyone.
You’ll want to choose a trustee willing to be open with the beneficiaries, answer their questions, and give updates on their work. When beneficiaries receive little to no information regarding the estate, it raises questions and concerns. Plus, it can cause fear of the trustee performing improperly or not at all. With a will, the executor must answer to the courts. However, with a trust, your trustee must be reliable enough to keep all parties informed of any actions and changes. A lack of open communication may automatically cause mistrust and lead to legal litigation. This can delay the disbursement of assets to your beneficiaries and cost money that could be spent better.
Discuss your wishes with your children and beneficiaries. This may help them understand that you want to keep things fair. Plus you will know what they are thinking. You may not know that not all children want an equal share of the vacation home, but they would rather sell the property and have the money. However, you must understand that the final decision is ultimately yours, even with collaborative planning. You may not be able to please every beneficiary, but it will at least remove the question of why you made certain decisions. When your beneficiaries understand ahead of time what to expect, this may reduce confusion and litigation.
Estate litigation is typically handled by a probate litigation attorney, who focuses on resolving disputes that arise during the estate administration process, such as will contests or challenges to the executor’s actions, through litigation in court; probate attorney routinely handles the routine administrative aspects of an estate without necessarily going to court.
Careful planning and open communication are often needed when establishing your estate plan. Your loved ones will be facing emotional loss and do not want to become ensnared in a legal battle that may last for several years. However, working with an experienced trust attorney can help you build an estate plan that works best for you and your loved ones.
The attorney will also ensure that you build a legally binding plan, leaving little room for litigation. For instance, you must be very clear and concise in your will or trust. You cannot be vague or leave anything open to interpretation; otherwise, there will surely be a misunderstanding among your beneficiaries. You cannot state, ‘I wish to leave my car to my nephew.’ What if you have several cars or several nephews? Even though you may have discussed with your nephew, Nate, that he is to get the Kia Soul, a battle will ensue if you do not specifically state all information in the will or trust.
Do you have questions about setting up a probate, estate litigation or setting up a trust in Illinois? Contact us today at the Estate & Probate Legal Group at 630-864-5835. Our experienced attorneys understand applicable laws and can advise you on the best options to protect you and your loved ones.
Areas we serve: Cook, DuPage, Kane, Lake, Kendall and Will counties.
