A Look at Phillip Seymour Hoffman’s Estate Planning
Celebrities are generally in the limelight, and consequently, we can often learn valuable lessons from their errors. As far as learning from mistakes, estate planning is no different than many other areas of life.
According to the Forbes, Phillip Seymour Hoffman’s estate is worth $35 million. Even so, the most current version of Hoffman’s will, dated 2004 and filed in the Manhattan Surrogate Court, valued his estate in excess of $500,000 — a notable discrepancy in values. His will stated his desire for his son Cooper Hoffman to be raised in and live in or near Manhattan, with other chosen locations as Chicago or San Francisco. If his long-time partner Mimi O’Donnell, who is the mother of his three children, could not live in any of these cities, then he strongly desired that his son visit these cities at least twice a year.
Important to consider is also the fact that because Seymour and Mimi never married, Mimi does not qualify for the marital exemption under Internal Revenue Service Code (I.R.C.) § 2056(a), where property passes tax-free to a surviving spouse. This means that about 40 percent of the remaining Hoffman estate after accounting for Hoffman’s $5,340,000 exemption goes to the IRS as estate tax. New York estate taxes are also a consideration because the couple was not married. Mimi loses an estimated $12 million from the estate to taxation as a non-spouse.
The two major mistakes in Hoffman’s estate planning were neglecting to:
- Marry his partner
- Keep his estate plan current to cover any changes since 2004, including the birth of two other children, born in 2006 and 2008
Although contemplating a time when you’re unable to be with your family and friends is something no one wants to do, estate planning is important for preserving assets. Meeting with your attorney to review your Florida estate planning, discuss tax ramifications and implement necessary legal changes can protect your loved ones’ future.