6 celebrity estate planning lessons from 2014

We’ve lost some of the most beloved personalities in show business this year, from funnyman Robin Williams to husky-voiced starlet Lauren Bacall. Many celebrities who passed away this year left behind not only critically acclaimed careers, but also complex financial situations in need of rock-solid estate planning. Some had multiple children from multiple marriages to account for; others left family and friends with complicated legal battles. Some were in dire financial situations, or had debilitating diseases that required intricate end-of-life planning. 

Take a look at these six celebrities’ estate plans from 2014 and see who prepared well and who could have planned better to secure their final wishes for their fortunes and loved ones.

1. Philip Seymour Hoffman 

Age at death: 46 

Estimated value of estate: $35 million 

Estate plan lesson: If you’re not married to your life partner, leave the estate to your children in trust; update your will regularly. 

On February 2, Oscar-winning actor Philip Seymour Hoffman, who “The New York Times” called “perhaps the most ambitious and widely admired American actor of his generation,” died of a heroin overdose at the age of 46. 

Hoffman was survived by his longtime partner, Mimi O’Donnell, and their three children. By holding true to his principles about marriage and parenting, and by failing to update his documents, Hoffman subjected his estate to significant and unnecessary tax hits. 

It has been widely reported that Hoffman rejected the advice of his attorney and accountant who on many occasions advised him to create a trust. Hofmann stood firm, saying he didn’t want his three children to be “trust fund kids.” He also never married the mother of his children, O’Donnell, as he didn’t believe in marriage. 

Hoffman’s estate, which he left to O’Donnell, was reportedly worth $35 million. Because the two weren’t married, the entire sum was taxable at a rate up to 40 percent for the assets over the $5.34 million federal estate-tax exemption, as well as up to 16 percent in New York state taxes — a total of up to $15 million in estate taxes. To add insult to injury, when O’Donnell passes away, the assets will be taxed again if the amount still exceeds the estate tax threshold. Double taxation could have been avoided if Hoffman had been legally married to O’Donnell or left the estate to his children in trust. 

Another oversight in Hoffman’s estate plan was that he never updated his will to include his two younger children, who were born after the first will was signed. Since the document mentions their son but does not directly mention their two daughters, O’Donnell might have to include more provisions to make sure all children are treated equally. 

[Sources: CNN; Daily Finance] 

Up next: Mickey Rooney

2. Mickey Rooney 

Age at death: 93 

Estimated value of estate: $18,000 

Estate plan lesson: Estate battles and financial exploitation of seniors aren’t unique to cases involving millions of dollars. 

On April 6, actor Mickey Rooney died of natural causes at the age of 93, after an almost 90-year career in film, television, Broadway, radio and vaudeville. Rooney left behind eight children from multiple marriages, as well as grandchildren, an estranged wife, and two stepsons. 

Although his career spanned over eight decades, Rooney’s estate was valued at only $18,000 when he died. Family members allegedly exploited him financially in the years preceding his death. In 2011, Rooney sued his stepson Christopher Aber and Aber’s wife for financial exploitation. Aber agreed to a $2.8 million settlement but has not had the financial means to pay it. Rooney gave a testimony about his victimization in front the Senate Special Committee on Aging, saying, “I felt trapped, scared, used and frustrated.” Because of this alleged abuse, a judge granted attorney Michael Augustine conservatorship over Rooney and his estate, and issued a restraining order on Christopher Aber. Aber’s mother and Rooney’s wife, Jan Chamberlin Rooney, supported her son in the dispute.

Jan and Mickey Rooney separated shortly thereafter, in 2012, after 34 years of marriage. Jan signed an agreement waiving all claims to her husband’s estate. Two years later, just weeks before his death, Rooney — whom Augustine deemed physically and mentally competent — disinherited all his children from his will, stating that he had no ill feelings towards his children but that they all had established financial situations and did not need the little money remaining in his estate. Rooney named Augustine as the executor of his will, and named his stepson Mark, Christopher Aber’s estranged brother, who had been Rooney’s caretaker and with whom Rooney lived for the last two years of his life, as the sole beneficiary of his estate. 

Just five days after Rooney’s death, Jan disputed the validity of Rooney’s will. Her attorney, Eugene Belous, is cited as saying the will contains “a blatant misstatement” about the agreements she and her late husband made. “There is no provision in either of the two settlement agreements … that terminates or in any way affects her rights as surviving spouse,” Belous said. Jan, along with her son Christopher, demanded that Rooney be buried in a family plot, but after separating from his wife, Rooney had expressed his wishes to be buried alongside other Hollywood stars. The family reached a settlement, allowing Augustine to have Rooney buried in the Hollywood Forever Cemetery.

Rooney’s story highlights that estate battles — as well as the exploitation of seniors — aren’t unique to cases involving millions of dollars. And given that Rooney had been married eight times, had children from different marriages, and had multiple estranged family members, it is fortunate that he kept his will up-to-date in the years before he passed away. 

[Sources: CNN; USA Today; Reuters] 

Up next: Casey Kasem

3. Casey Kasem 

Age at death: 82 

Estimated value of estate: $80 million 

Estate plan lesson: Include advanced medical directives and appoint someone to make medical decisions on your behalf. 

On June 15, famed radio personality Casey Kasem died at the age of 82 from complications of dementia. Kasem was best known for hosting the music countdown “America’s Top 40” and providing the voice of “Shaggy” from the Scooby-Doo franchise. 

Kasem’s official cause of death was sepsis caused by an ulcerated bedsore after being hospitalized for two weeks. In his last days, a family dispute erupted over the continuation of his medical intervention, but Kasem had an advanced medical directive in his end-of-life plan that quieted the confusion. 

In 2013, Kasem was diagnosed with Lewy body dementia, in addition to a Parkinson’s disease diagnosis in 2007. As his health worsened, Kasem’s wife, actress Jean Thompson Kasem, prevented Kasem’s three children from a previous marriage from any contact with her husband. Three months later, Mike, Julie and Kerri Kasem petitioned for conservatorship over their father’s care but were denied. 

In May 2014, Kerri Kasem was granted temporary conservatorship over her father, who was taken out of a Santa Monica, Calif.-nursing home by his wife Jean. Shortly thereafter, Jean told the court that Casey was “no longer in the United States,” leading to an investigation of his whereabouts. He was found bedridden in Washington state, in critical condition and without food, water or medication. Judge Daniel S. Murphy ordered the continued feeding and hydration of Kasem, but Kerri Kasem’s lawyer noted that Casey was removed from artificial sustenance because he had signed an advanced medical directive in 2007, which had appointed Kerri, and not his wife Jean, to make his end-of-life decisions. The document stated that Casey would not want to be kept alive if it “would result in a mere biological existence, devoid of cognitive function, with no reasonable hope for normal functioning.” 

In June 2014, Judge Murphy reversed his decision to continue feeding and hydration. In a public statement, Kerri Kasem said that the court’s decision “upheld our father’s explicit wishes as expressed by him in his health directive.” 

[Sources: CNN; Forbes; Los Angeles Times; Reuters] 

Up next: Robin Williams

4. Robin Williams