On July 16, 2013, we published a blog entitled “The Will of James Gandolfini: Bad Tax Planning or Good Listening?” Since that blog, we have continued to monitor the commentary that has been written regarding the estate plan of actor, James Gandolfini. The analysis and criticism has been overwhelming with regard to James Gandolfini’s estate plan. As we previously stated, we do not view this situation as one that is ripe for criticism; that is not our job. Our job is to analyze the case and use it’s teachings as an educational tool.
Everyone nowadays has a computer. Further, with the abundance of social media, everyone is researching and self-educating on numerous topics. One of those topics happens to be estate planning. We receive several calls per week from potential clients who start the conversation with the phrase “I need a Revocable Living Trust.” Do they? More often than not, the individuals inquiring about our services have no idea as to the pros and cons of Trust planning, let alone whether or not they need one.
As we have stated in the past, our number one question to clients and potential clients is “What are your goals?” This is the guiding narrative that will shape what type of estate plan we draft. Some people need Revocable Living Trusts (whether their goal is to avoid probate, asset protection, or numerous tax planning objectives) and some people do not. What the James Gandolfini probate matter teaches us is that there is one more big reason why individuals may want to think about Trust planning: Privacy! Many of you are probably thinking (in your best Tony Soprano voice), “Forget about it!” Well, not so fast my friend!
We make it a point to advise all of our clients that the dispositive provisions of a Revocable Trust are private. Therefore, upon death, there is no public filing that takes place, like a probate matter, that makes the Trust distributions public knowledge. For public figures, celebrities, wealthy individuals, or individuals who simply relish privacy, Trust planning can accomplish this goal. Thus, we agree with commentators who have stated that the issue with the Gandolfini estate matter is not so much what his estate planning goals were, but that they have become so public. The simple creation of a basic Revocable Living Trust and simple pourover Will would have theoretically kept the Gandolfini estate plan out of the public eye. That Revocable Living Trusts could have contained the identical dispositive provisions as his Will did and such dispositions would have been private. Therefore, Mr. Gandolfini’s estate planning goals would have been accomplished and they would be kept private so as to avoid the current backlash that continues in the public eye. Please remember, though, after a Revocable Living Trust is drafted and signed, the next step is almost equally important, i.e. transferring your assets to your Revocable Living Trust. If you create a Revocable Lilving Trust, but maintain ownership of your assets in your own name, then it is no longer private, and your goals may not be attained. This is a two step process: Drafting and signing the Revocble Livng Trust and transferring the assets.
Every client has different goals. In light of the current drama taking place in the public eye over Mr. Gandolfini’s estate plan, individuals and planners alike must consider that privacy is just as important as stereotypical Trust planning objectives such as tax savings, asset protection and special needs. If you don’t want your estate plan to get whacked after death, consider keeping it private in the confines of a Trust.
- Adam Abramowitz, Esq.