When 51-year-old actor James Gandolfini died suddenly in Italy in June, a nation mourned. Best known for his role as the ruthless mobster on “The Sopranos,” in real life, he was quite the opposite.
But despite leaving a detailed will, second looks at how he divided his estate has some people here in Texas, as well as others across the nation, cringing. That’s because, as some experts have pointed out, Gandolfini’s will does not take advantage of current estate tax laws. In the end, the deceased actor may pay out more to the IRS than his beneficiaries–something he may not have intended when he first drafted the will.
Gandolfini’s major mistake was that he only left 20 percent of his estate to his wife. Federal law currently allows unlimited tax-free transfers to spouses; but because Gandolfini left a majority of his estate to his infant daughter and a son from a previous marriage, almost 80 percent of the assets covered by the will may be subject to both state and federal tax laws. As our readers can imagine, this may not have been foreseen by the actor prior to his death.
While most of our Texas readers will want to make their wills as tax efficient as possible before they pass on, this may not have been Gandolfini’s thoughts. He may have wanted to ensure that his children were properly taken care of by their inheritance. But as we’ve mentioned to our readers on several occasions, this can be done through trusts as well, which will not only provide financial security for beneficiaries but avoid estate taxes as well.
Just this story alone is a great example of why speaking with an attorney is a good idea when preparing your end-of-life documents. While mistakes can be made by even the most well-informed of people, having the right help at your side can sometimes mitigate these mistakes so that they don’t get passed on to your beneficiaries in the end.
Source: CNBC News, “Gandolfini’s will a case study on what not to do,” Kelley Holland, July 26, 2013