Aretha Franklin may have been the “Queen of Soul”, but nothing could help her family financially when she died on August 16, 2018. Despite having 112 singles on Billboard music charts, Ms. Franklin failed to have a will and trust created prior to her death. Without that will and trust, her estate was considered intestate.
Since Ms. Franklin resided in Michigan, the laws of that state dictated the legal process after her death. Michigan’s intestacy laws are quite clear of how the assets of a person’s estate are distributed when there is no will in place. While it was assumed in the beginning that her four children would split her estate equally, it was up to the probate court to make the determination of the amount.
The probate court would need to determine how much her liquid and tangible assets were worth. The court also needed to take into account the copyrights for her original compositions, as well as the portions she received for any songs written by other artists. And of course, future earnings would play a role too.
It took more than two and a half years before the probate courts finally had Ms. Franklin’s estate figured out. During that time, the Internal Revenue Service showed the court that Ms. Franklin owed approximately 7.8 million dollars in unpaid taxes. There is some dispute over the amount owed to the IRS. But the court has managed to find a way to pay off that debt in installments while allowing the sons to receive money from the estate at the same time.
The estate had already been paying down the IRS unpaid tax balance. As of December of 2020, the current balance due to the IRS was approximately 4.75 million dollars.
A new deal has been reached that will have 45% of quarterly revenue being paid towards the IRS balance. 40% of the quarterly revenue would be directed to an escrow account, which is designed to pay for any future taxes on new income.
The remaining 15% of the quarterly revenue is to be used to manage the estate. Each one of Ms. Franklin’s sons received an immediate payment of $50,000 earlier this year. And if the current plan is accepted by the courts, each one of her sons will receive a quarterly cash payout in the future.
As you can see, the probate court can be quite a lengthy process. And in the end, the people hurting the most are the people you loved the most. Ms. Franklin’s sons did not have access to any of her money, or other assets, because they were tied up in the legal process of probate.
I don’t want your family to suffer through anything like this in the future, which is why I encourage everyone to have a will in place prior to their death. If you haven’t even started thinking about a will, I want you to know it is not too late. Simply contact me today and we can get the process of creating a will started.