The family of the late actor James Gandolfini is about to be whacked by the IRS. Mr. Gandolfini had an estate of approximately $70 million, and it appears that the majority of it will be distributed via a simple will that lacks the necessary tax planning provisions that would have delayed the payment of estate tax upon his death. This lack of proper planning cost his family about $30 million; see http://www.dailyfinance.com/2013/07/08/james-gandolfini-will-estate-tax.
To make matters worse, the family may be forced to sell assets to pay the tax. Perhaps Mr. Gandolfini was aware that this was going to happen. After all, it appears that he at least formed an irrevocable life insurance trust to pass $7 million to his son tax free. So, why didn’t he do anything more? Estate Planning is one of those things that people put off because they don’t think that they are going to die, at least not any time soon. Mr. Gandolfini was only 51 when he passed away and, like most, assumed that he had plenty of years left to take care of the rest of his estate plan….later. I suspect that he simply ran out of time. His mistake was a costly one.