King & Wood, P.A.

What Does an Executor Do?

“This expert guide presents 11 proven methods to handle estate settlement properly with support from professional advice and tested practices.”

Being named as an executor is an honor and a large undertaking. An article from msn offers a guideline: “Executor’s Checklist: 11 Essential Steps to Smoothly Settle an Estate.”

Obtain death certificates. Secure multiple original death certificates from the funeral home. You’ll need them to start insurance claims, close Social Security and many other future transactions.

Find the will and other estate planning documents. An estate planning attorney can help you file the will with the probate court. This is necessary for the executor appointment to be approved and the will to be validated. Once these two events occur, you can begin to settle the estate. If there is no will, an estate planning attorney should be contacted to guide the process through the courts.

Notify beneficiaries. You’ll also need to notify family members to avoid misunderstandings, even if they are not mentioned in the will. The attorney will tell you if you need to publish a legal notice in a local newspaper or other outlet. Social Security, Medicare and any other government agencies must be notified. Being transparent and thorough will prevent legal problems from occurring later on.

Secure and inventory assets. If the decedent hasn’t done so, create an inventory of all assets, including real estate, investment accounts, cars, boats and personal belongings. A thorough inventory would minimize the chances of lost assets and conflicts with heirs.

Establish an estate bank account. You’ll need to apply for an EIN number first, then you’ll be able to open an estate bank account to consolidate the deceased’s accounts. The executor uses the funds in the estate account to pay bills, debts, taxes and any estate-related expenses. A clear record will help in reporting to beneficiaries.

Manage ongoing expenses and settle debts. Utilities, mortgage payments and insurance premiums still need to be paid. By keeping them up to date, you maintain the estate's value and prevent disruptions to essential services. If there is no money in the estate, the executor may need to sell assets to pay bills. Document everything to protect yourself from any future conflicts.

File tax returns. The executor is responsible for the decedent’s final income tax return and any estate tax returns. If the decedent lived in a state with an inheritance tax, the inheritance tax is the responsibility of the heirs, not the executor. Consult with a local estate planning attorney to be sure that the required tax payments are being made.

Have assets evaluated by a professional. An expert should value businesses, jewelry, art, collectibles and real estate. You should not do the real estate valuation, even if you are a realtor. A certified appraiser should value high-ticket items. Your estate planning attorney will have a network of experts to offer.

Pay estate taxes. If the estate is higher than the federal estate tax exemption limit, the estate will need to pay taxes within the applicable time limit. If you fail to meet the deadline, the penalties are strict and could result in substantial fines. While the current federal estate tax exemption is at an all-time high of $13.99 million per person, this may change in the future.

Distribute assets. Assets should not be distributed to heirs until all debts and other costs have been paid. Make sure to get receipts or signed agreements from beneficiaries to have proof of compliance.

Close the estate. Don’t overlook this final step. The court must be presented with a final financial summary of all financial dealings, including asset prices and debt repayment. Once the approval has been obtained, estate bank accounts can be closed and you can hang up your executor hat.

As you can see from these 11 steps, being an executor is a large responsibility. If it’s too much, speak with an estate planning attorney who can take on all or some tasks or provide guidance.

Reference: MSN (April 14, 2025) “Executor’s Checklist: 11 Essential Steps to Smoothly Settle an Estate”

Don’t Overlook Estate Planning While Building a Business

“With these pressures, personal estate planning often takes a backseat. This can lead to missed opportunities for minimizing tax exposure and cementing a founder's legacy.”

According to a recent article from Reuters, “Estate planning for founders: a roadmap for success, " estate planning should be at the foundation of an entrepreneur's overall plan for the future.” The pressures of building a business can cause estate planning to be overlooked, leading to significant issues for family members and the business itself.

Core planning, business continuity and wealth transfer strategies are key components to be addressed.

Core planning clarifies estate planning. Who will control the assets, who will benefit from them and how will taxes be paid? Included in core planning is creating a will and trusts and appointing fiduciaries for the estate. Within this area, there are three further elements:

• Planning for taxes. If a startup value appreciates rapidly, there needs to be a plan to mitigate transfer taxes to maximize the wealth passed to the next generation.
• Asset protection. Inheritances need to be protected by implementing asset protection strategies. This may include using trusts, company structures (like LLPs) and other means of protecting assets from claims by creditors or ex-spouses.
• Planning for Incapacity. With properly created documents, including Financial Power of Attorney, Healthcare Proxy, HIPAA Release and Living Wills, the business owner’s personal and financial affairs are handled smoothly by individuals of their choosing.

Business continuity requires a strategic plan for incapacity and the eventual fate of the business, whether it’s to be passed down to the next generation, sold, or dissolved.

• Liquidity planning. If the founder’s retirement is to be funded by the sale or transfer of the business, how will the business continue to operate? Cash flow mechanisms could include insurance policies, investment accounts, or other liquid assets.
• Buy-Sell Agreements. These are often created to take effect following a triggering event, like death or incapacity. The agreements should be designed to avoid any disputes and ensure the stable continuation of the business.
• Funding with Life Insurance: Life insurance is often used as part of buy-sell agreements to ensure that the business can continue and the family receives fair compensation for their portion of the business.

Wealth transfer strategies. The goal is to maximize the owner’s legacy by minimizing taxes and transferring wealth to beneficiaries most efficiently.

• Estate “freezing” techniques include the use of Grantor Retained Annuity Trusts (GRATs), Spousal Lifetime Access Trusts (SLATs) and dynasty trusts, used to minimize estate taxes by transferring future appreciation of assets to beneficiaries.
• Qualified Small Business Stock Planning. If founders have Qualified Small Business Stock (QSBS), they can achieve significant income tax benefits with careful estate planning.
• Charitable Giving. Philanthropy is a means of reducing estate taxes, while supporting causes that have meaning for the founder. Creating charitable trusts or foundations allows business owners to impact their communities, significantly enhancing the founder’s legacy.

Regardless of the size of the business, it’s important to create a plan to address issues to protect the business's long-term growth, maximize the wealth of the founder and their family and create a legacy for the future. Talk with an estate planning attorney about creating a plan today.

Reference: Reuters (April 17, 2025) “Estate planning for founders: a roadmap for success”

Zappos Founder’s Will Is Discovered: What Now?

“Tony Hsieh left a will that was just discovered—4½ years after his death, according to a new court filing that could upend the tech mogul’s probate case and legal battles over his estate.”

This new development in the Hsieh estate saga presents two estate planning lessons: make sure your executor and loved ones know where your estate planning documents are located and have a successor executor in case your co-executor cannot act on your behalf.

An article from the Las Vegas Review-Journal, “Shocking twist: Tony Hsieh left a will after all, new filing says,” explains what we know so far.

Tony Hsieh founded Zappos, building the online shoe and clothing website into a unique and highly successful business. In 2009, Hsieh sold Zappos to Amazon for $1.2 billion, remaining as CEO until 2020.

After Hsieh died, his father acted to take over the administration of his estate. Many court filings stated that no will existed. However, lawyers who aren’t connected to the Hsieh family filed court papers with a will and an explanation of how it was found recently.

The new court papers included a will dated March 13, 2015, signed by Hsieh and several witnesses. The document had been given to Pir Muhammad, who subsequently developed Alzheimer’s disease and passed away. The will was found among Muhammad’s personal belongings.

The will says that only Muhammad had a copy of the original will. Hsieh was worried about someone tampering with his will and made a video as an additional layer of precaution. Hsieh’s letter also said no beneficiaries had been told about his plans, so that they wouldn’t know anything until after his passing. He said he wanted them to “experience the ‘WOW’ factor.”

The ‘WOW’ factor was a core value at Zappos, described as creating a memorable, delightful customer experience. While it was great for his customers, it wasn’t so great for his estate plan.

The newly discovered document named an attorney as co-executor with Muhammad and said that if either Muhammad or Armstrong failed to act, another attorney was the contingent executor. Muhammad had signed the will. However, the other two co-executors had not.

Many claims have been made against the estate by people who say they were doing business with Hsieh. Sadly, in his final years, court papers state his behavior was increasingly erratic. There were allegations of people taking advantage of him as his health deteriorated.

According to the family’s legal counsel, the family sought to locate a will. However, they were unsuccessful.

While Hsieh’s precaution was understandable, given the vast wealth, unfortunately, his decision not to tell anyone about the will’s existence has led his family to an equally large amount of legal trouble and stress.

The lessons apply at any level of wealth. Have an estate plan created with an estate planning attorney, share document details with more than one person and plan for the unexpected to protect your loved ones and your legacy.

Reference: Last Vegas Review-Journal (April 18, 2025) “Shocking twist: Tony Hsieh left a will after all, new filing says”

Three Top Excuses Heard by Estate Planning Attorneys

“We all know we’re going to die one day. There are things we should put in order before that time comes.”

Recognition of your mortality and taking the time to plan for tying up the business of your life are two very different things. Estate planning attorneys hear reasons for delay all the time. However, the explanations aren’t going to help your family when they have to administer an unprepared estate while grieving. A recent article from MarketWatch, “The top 3 excuses people make to put off estate planning--and why they’re all wrong,” offers food for thought.

I don’t own enough to need an estate plan. Even if you die in debt, you need an estate plan to prevent loved ones from having costly problems like probate, taxes and other issues. If you’re in a nursing home and all you own is a bank account with a named beneficiary, you may not need a will. However, you definitely need medical directives, including:

• Healthcare Power of Attorney (or Healthcare Proxy), someone you name who can make medical decisions.
• HIPAA Release so a person of your choosing can access health insurance information and medical records.
• Designated representative for Medicare, Medicaid and Social Security
• Living Will to express wishes for end-of-life care. Do you want to be kept on life support if you aren’t expected to regain consciousness? What about artificial feeding? These are tough issues to address. However, without expressing your wishes, your family won’t know what you want.

Procrastination has worked before, so why change now? Many people are waiting to see if changes will come to federal estate tax exemptions, which are set to happen at the end of 2025 unless Congress acts. No one knows what will happen. However, if your estate is hovering near the $7 million mark and you wait until the last minute to make changes, your estate could become taxable. Creating and executing an estate plan takes time, so that procrastinating could cost your heirs 40% of your estate.

I don’t know where to start. This is what experienced estate planning attorneys are for. Just as you wouldn’t be advised to perform surgery on yourself, you need the services of a skilled and trained estate planning attorney to create an estate plan to achieve your goals.

Start by gathering any documents you might already have, including investment and pension accounts, life insurance policies, titles and deeds and anything you think might be relevant. Next, make an appointment with an estate planning attorney who can explain the process, offer strategic tools to minimize taxes, transfer wealth and prepare an estate plan to protect you and those you love.

If you need more of an incentive consider this: putting a loved one through the process of a scavenger hunt to identify documents, spend their own money to retain counsel to go to court to obtain a guardianship if you are incapacitated and need their help, or be powerless as a lifetime of work evaporates in estate taxes, will teach a valuable lesson of what not to do. If you’d prefer to be remembered with love and affection and not resentment, it’s time to stop procrastinating.

Reference: MarketWatch (April 17, 2025) “The top 3 excuses people make to put off estate planning--and why they’re all wrong”

Why You Need an Estate Planning Attorney

“Handling legal documents without expert guidance can lead to costly mistakes, overlooked details and unintended consequences.”

It seems like some estate planning documents should be easy for a regular person to create. However, as the Greek philosopher Socrates said, “You don’t know what you don’t know.” This is especially true when it comes to estate planning, says a recent article, “9 Legal Documents You Should Never DIY—Here’s When to Call a Lawyer” from msn. If you create documents and they aren’t legally sound and enforceable, your home-made solution could cause a mess for you while living and your heirs after you’ve passed.

Healthcare Proxy. Having a healthcare proxy document prepared allows someone you trust to make medical decisions for you if you cannot. A standardized form is just that—standard—and may not reflect your personal wishes. This document is also important for parents of young children, so a person you trust can make decisions for your children if you cannot.

Power of Attorney. The POA is used to appoint a person of your choosing to handle your financial and legal affairs if you become incapacitated. The agent’s powers end upon your death. An estate planning attorney will draft one reflecting your wishes and following your state’s laws.

Living Will. This document expresses your personal medical preferences if you can’t communicate. If your medical situation is dire and you are not likely to become conscious, it provides clear guidance for long-term care. Without this document, your loved ones will be left guessing what you would have wanted.

Revocable Living Trust. Assets placed into trusts don’t go through probate, remain private and pass directly to heirs as per the instructions in the trust. An estate planning attorney will tailor the trust to your situation during life and after death.

Beneficiary Designations. When you open an investment account or purchase life insurance, you can name a beneficiary. This is the person who inherits the account or receives proceeds on your death. Many estate planning mistakes occur because people don’t update their beneficiary designations. Note that the beneficiary designation overrides any will or trust, so be sure they are correct.

Business Succession Plan. If you own a business, this blueprint will be used to direct how the business should continue when you retire or after you die. It will address issues of leadership, family ownership and your vision for the business to continue in the future. It takes several years to create a business succession plan, and your estate planning attorney will work with family members, key employees, financial officers and CPAs to ensure a smooth transition.

Last Will and Testament. This document directs how you want your property to be distributed upon your death. Without a will, known as intestacy, your estate is distributed according to the laws of your state, usually by bloodlines or kinship.

Prenuptial or Postnuptial Agreements. While these documents are used in case of a divorce, they are sometimes used to support estate planning disagreements to clarify intentions. If you come to a marriage already owning assets, or if there is a big disparity in wealth, it makes sense to have an agreement in place.

Guardian Designation. If you have minor children, your last will and testament includes a guardian named to raise your children if both parents die or become incapacitated. An attorney is needed to be sure this is properly documented. Without a will naming a guardian, a court will decide who will raise your children.

Working with an experienced estate planning attorney protects your family, finances and future. Estate planning attorneys know what you don’t—covering all bases and preventing legal complications for you and those you love.

Reference: msn (March 17, 2025) “9 Legal Documents You Should Never DIY—Here’s When to Call a Lawyer”

Estate Planning Lessons from Celebrities

“While it can be easy to assume that celebrities would have airtight estate plans, time and time again Hollywood stars have made costly decisions that could have been easily avoided.”

Putting off making estate plans is common. However, it is also not wise. You won't know about the legal battles, tax bills, financial chaos and family stress. However, your family will. Learning from the mistakes made by famous people provides good lessons, says a recent article from CNBC, “3 end-of-life money mistakes celebrities have made—and how you can avoid them.”

Aaron Carter was very young when he died without a will, leaving behind an 11-month-old son and a fiancée. In California, the court designates the child as the sole heir when an unmarried person dies without a will. However, Carter’s son was a minor, and minors may not legally inherit assets. In this case, the court appointed a fiduciary to manage the estate.

A better way: have an estate plan created, even if it’s just a basic will. Parents of minor children should have a will to name a guardian, unless they want the court to appoint a guardian. An estate plan could also be used to care for a loved one if you aren’t married.

Another problem is created when there’s money but no estate plan. Few people want an 18-year-old child to inherit large amounts of money with no guardrails in place. A trust is an excellent way of setting terms and conditions on an inheritance, whether the parent is living or has died.

Kobe Bryant is an example of what happens when you don’t update an estate plan. When he died, he did have an estate plan. However, it hadn’t been updated to reflect the birth of his child, Capri. As a result, she wasn’t legally a beneficiary of his estate. His widow had to go to court to petition to have the daughter added to the trust.

Had the trust been updated, his widow would not have had to go through this process in the public eye.

Your estate plan needs to be updated when new family members are welcomed. The same is true for any big life event, like marriage, divorce, death, or a major financial change. Estate planning documents need to reflect the changes in your life.

James Gandolfini offers a harsh lesson in how estate planning is needed to prevent an estate from being decimated by taxes. Gandolfini had taken the time to create a will. However, no tax planning was done for his estate. His $70 million estate paid an estimated $30 million in federal and state estate taxes before making distributions to friends and relatives.

An experienced estate planning attorney will be able to review your situation and determine which strategies will work best to protect your estate and your family. Everyone needs to have an estate plan, no matter the size of your estate or how many people recognize you when you walk down the street.

Reference: CNBC (April 20, 2025) “3 end-of-life money mistakes celebrities have made—and how you can avoid them”

Is Power of Attorney for Health Care Needed If You’re Healthy?

 

“No one expects a sudden medical crisis. However, being prepared can save your family from unnecessary legal battles and emotional distress.”

Like most people, a 61-year-old man never thought he would have a health crisis. Neither did his family. However, he was struck with a sudden heart attack, followed by complications leading to a brain injury and he became incapacitated. The family was faced with a terrible situation in addition to their father’s health crisis.

The couple had never done any estate planning, nor did they have a Power of Attorney for Health Care. The spouse assumed she would have the legal right to make medical choices for her husband.   However, without a POAHC, she had no standing. A recent article from the Wisconsin Newspaper Association, “Wisconsin Spouses can’t make medical decisions without this document,” should serve as a wake-up call for families across the country, since this is not a one-state issue.

There is no automatic right to make healthcare decisions for an incapacitated partner. Unless both spouses are joint owners, one can’t access bank accounts. Without having the right estate planning documents in place, a spouse won’t be able to make decisions, pay bills, or transfer money between accounts to ensure the household runs smoothly.

Medical decisions for the man fell into legal limbo and got tangled up in red tape. Instead of focusing on his recovery, they embarked on a legal process that could have easily been avoided with one document.

First, the family had to petition the court for legal authority over his medical care, known as guardianship. This was an expensive, time-consuming and emotionally exhausting process, all going on while they were adjusting to this dramatic change in his health.

Making matters worse, he was not a compliant patient in his altered state. He wandered frequently, and one night, he got out of the hospital on a bitterly cold night. To make matters worse, the hospital couldn’t discharge him to a rehabilitation facility until the court awarded the family guardianship. The family was bombarded with questions about the status of his case, which was scheduled weeks away.

At the same time, there were further problems with the hospital without a designated health care agent. First, the hospital administrators insisted that the patient be discharged to a long-term care facility. They then said the insurance company had stopped paying, so he had to go home. When the family sought help from the county, the hospital threatened to tell the courthouse that the family was neglecting him and threatened the guardianship process.

The hospital reneged on its promise to help provide at-home nursing care when the guardianship process was finally completed. The family was left on their own to find appropriate care.

This nightmare could have been avoided if the couple had an estate plan, including naming a healthcare agent with a Power of Attorney for Healthcare. When he became incapacitated, his wife or adult child could have had the legal authority to make health care decisions on his behalf without the delays, added expense and frustration of court proceedings.

Everyone should have a Power of Attorney for Healthcare, sometimes known as a Healthcare Proxy, to name another person to step in and make decisions for them in case of incapacity. We never know what will happen, even to our healthiest family members. Anyone over age 18 needs to have a POAHC. Talk with your estate planning attorney and take care of this before it’s needed.

Reference: Wisconsin Newspaper Association (April 7, 2025) “Wisconsin Spouses can’t make medical decisions without this document”

What Estate Planning Documents are Needed for a Smooth Transition?

“As the baby boomer generation ages, they will pass savings and assets on to their children, grandchildren and charitable organizations.”

No matter the size of the wealth you hope to pass on to the next generation, planning for wealth transfer should be done as soon as possible. It’s good to start talking and educating children about money, as early as their teenage years, says a recent article from yahoo! finance, “Multi-Generational Wealth Transfer: The Financial Records You Need for a Smooth Transition.” Conversations about financial responsibility, the children’s goals and family values can profoundly impact the family dynamic and the children’s fiscal knowledge.

You’ll also want to be sure you have all the estate planning and financial records needed for a smooth wealth transfer and access to the necessary data. Here’s what this includes:

Last Will and Testament. This document outlines how you want probate assets to be distributed after your passing. You’ll need to have an inventory of all assets and a clear picture of your finances. It’s good to review your finances and estate plan on a regular basis.

Trust Documents. While the will is a set of instructions, a trust is a legal entity used to hold assets. Those assets in trusts aren’t subject to probate, offer privacy and allow for the assets to be used in case of incapacity during your lifetime.

Healthcare Directives and Power-of-Attorney. Estate planning isn’t just about asset distribution. Everyone should have a healthcare directive and a power of attorney. If you are seriously injured in an accident, healthcare directives will be needed to allow others to be involved in your care. A power of attorney empowers a person of your choosing to make decisions on your behalf. If you don’t have these documents, your family will have to go to court and petition to obtain conservatorship or guardianship to be involved with your care and finances.

Retirement Account Statements and Tax Returns. Access to these documents will help your executor or agent figure out your financial status. Tax returns contain a wealth of information, including income, account information and potential tax liabilities.

Real Estate Deeds, Mortgages, and Titles to Cars, Boats, etc. Titles documenting ownership, deeds, vehicle registrations and mortgage and loan information will all be needed to settle your estate.

Digital Assets. Educate yourself about the importance of sharing access to digital assets, so you can prepare properly if you are incapacitated or when you die. While some platforms can assign a legacy contact, others may only be accessible by sharing the username and password information. If the asset uses third-party authentication, your executor will also need your phone or access to email to manage your accounts. Passwords and PINS should be stored with both a hard copy and online with a secure password manager.

An estate planning attorney in your community will know how to best prepare for transferring wealth, from preparing the necessary documents to exploring different strategies and guiding the process.

Reference: yahoo! finance (March 31, 2025) “Multi-Generational Wealth Transfer: The Financial Records You Need for a Smooth Transition”

Should You Worry about Your Estate Taxes?

“The biggest difference between the inheritance and estate tax is who pays.”

You'll need a will if you own property, investments, or personal possessions and wish to pass them on to loved ones. While you’re creating an estate plan, you should also consider estate and inheritance taxes and how they may impact your legacy. According to a recent article from Go Banking, “Inheritance Tax 2025: Rates, Exemptions and How to Avoid It,” your estate may owe a tax to the state government even if it doesn’t rise to the current $13.9 million federal estate exemption now in effect.

There are still states requiring heirs to pay an inheritance tax. Those living in Pennsylvania, New Jersey, Nebraska, Maryland, or Kentucky would do their heirs a kindness by planning for inheritance taxes, so loved ones aren’t surprised.

If you’re leaving an inheritance, there are a number of ways to minimize or even avoid estate and inheritance taxes. Your estate planning attorney will be able to help you determine which methods work best for your situation. Here are some options:

Gifting. In 2025, everyone can give away as much as $19,000 to as many people as they want without paying gift taxes. Married couples can double this amount, making gifts to as many people as they wish.

 You may give larger gifts to reduce the size of your taxable estate. However, they will be counted against your federal estate tax exemption. Many states don’t tax gifts made during your lifetime, especially those with inheritance taxes.

Trusts. Trusts are used to remove assets from your taxable estate, with different types of trusts used to accomplish different goals. An Irrevocable Trust will take assets out of your estate. However. you’ll need to give up control over the trust. Qualified Personal Residence Trusts (QPRTs) are used to transfer your home to beneficiaries at a lowered tax value. Bypass Trusts help married couples reduce exemptions for both spouses.

Trusts are complicated and need the experience of an estate planning attorney to make sure thay they are the right trust for your situation.

Charitable Giving. Donations to 501(c)(3) charities are exempt from both inheritance and estate taxes. There are several ways to make donations, including making donations through your will, giving while you’re alive, creating a charitable trust, or using Donor Advised Funds (DAFs).

Charitable Remainder Trusts provide an income stream to heirs for a certain period, and then the remainder goes to the charity. You might also consider a Charitable Lead Trust, where income goes to the charity for a set amount of time, then the remaining asset goes to the charity.

Meet with an experienced estate planning attorney in your area to learn your estate tax responsibilities and how to plan for them for yourself and your heirs.

Reference: Go Banking ( April 14, 2025) “Inheritance Tax 2025: Rates, Exemptions and How to Avoid It”

Fashion Designer Takes Uniquely Named Approach to Her Will

“In a recent Trading Secrets podcast, fashion designer Rebecca Minkoff revealed that she has a special provision in her trust in case she divorces or dies before her husband, Gavin Bellour.”

Get ready because this is a doozy, or more accurately, a floozy. Minkoff, founder of a global handbag and clothing empire, has a “floozy clause”—a provision in her will stating if she predeceases or divorces her husband, her assets all go into a trust for her children. This is to prevent a second spouse from gaining access to her wealth, reports the article “Fashion Designer Rebecca Minkoff Reveals She Has ‘Floozy Clause’ In Will” from mondaq.

Minkoff says her mother came up with the idea, long before she or her husband had any money. However, Minkoff counted on becoming highly successful. She maintains that she trusts her husband implicitly. She doesn’t trust what someone else might do if she dies. Her goal is to prevent her children from needing to go to court against an unscrupulous person.

While the title of this provision is admittedly unique, it’s very common for individuals to want to have specific directions carried out after their death, from wishes for the administration of their estate or distribution of assets. Some want to restrict who their beneficiaries marry or even dictate the religion of a spouse.

Another somewhat unusual provision is the Special Trustee for Hostile Acts. In one case, it was used by a mother who wanted to bring harmony to her five children’s relationship after she died. She appointed a Special Trustee to limit trust determinations to any child engaging in a hostile act. However, controlling from the grave doesn’t always work. Litigation ensued between the siblings, and the case made its way up to an Appellate Court, which upheld the provision but declined to limit the application despite the request of several of the children. This mother knew her children very well.

A provision attempting to control the religious marriage requirement can be expected to be enforced if it doesn’t impose a total restraint on marriage in general or promote divorce. On the other hand, a provision providing a financial benefit for an illegal act will always be found invalid.

Back to Minkoff’s strategy: it’s got at least one flaw. If funds or assets pass directly to her husband at some point in time and he hasn’t moved on to a “floozy” with someone five years after her death, he can do whatever he wants with those assets. A better solution would be to put the assets in an Irrevocable Trust containing the limitations and restrictions she wants.

Her plan also creates a tax issue. A gift in trust for the surviving spouse passing to the children if the spouse remarries means the trust won’t qualify for the estate tax marital deduction. There is a way around this, however. The trust can be structured so that the surviving spouse receives the net income of the trust during their lifetime.

The plan isn’t a bad one. However, an irrevocable trust might be a better way to achieve the desired end in cases like this.

There is another aspect to consider when planning to control assets after death. Children are happier when their parents are happy. If a second marriage would make a surviving spouse happier, having to live under the constraints of a “floozy clause” could create resentments and tensions within the family.

Talk with your estate planning attorney about creating an estate plan to achieve your goals while you are living and after you have passed. If controlling assets after you have passed is important to you, they’ll be able to come up with a plan. You don’t have to create a new name for it—unless your mother is as clever as Minkoff’s.

Reference: mondaq (April 10, 2025) “Fashion Designer Rebecca Minkoff Reveals She Has ‘Floozy Clause’ In Will”