When “Fast & Furious” actor Paul Walker died in November, he left behind an estate with an estimated value of $25 million. The 40-year-old unmarried movie actor created an estate plan in 2001 — a will and trust shifting assets to his now-15-year-old daughter.
Young California adults are likely to have very different priorities, lifestyles and goals than people at age 40. Outdated estate planning documents don’t reflect changes in relationships, finances or feelings. Legal and family problems can occur unless a plan is revisited regularly and adjusted to mirror a current status.
Paul Walker was 28 when he drew up a will, at the same time the first movie of the “Fast & Furious” franchise was released. Walker’s wealth likely grew substantially as the years went by, but the will wasn’t amended. The actor designated his mother as the guardian of his daughter, but it’s uncertain whether the teen’s mother has or will retain current custody.
The minor daughter was the only beneficiary of Walker’s revocable trust. The actor gave his mother control over assets on the girl’s behalf. Since trusts are not public records, it’s unclear whether the teen will come into her full inheritance upon reaching adulthood or, as many trusts stipulate, receive staggered proceeds from the estate over a long period.
Legal observers noted that Walker’s trust was not fully funded. In other words, some assets owned by the actor were not transferred into the trust’s name and may be subject to estate taxes. Assets placed in trusts become the property of the trust and, consequently, are not taxed as part of an individual’s estate.
A pour-over will such as Walker had allows estate assets outside a trust at the time of a person’s death to be shifted to the trust. This type of will has the same effect on the estate as if the assets were already included in the trust.
Source: Forbes, “Five Estate Planning Lessons From The Paul Walker Estate” Danielle and Andy Mayoras, Feb. 10, 2014