estate

New Zealand Man Steals Almost $1 Million From His Mother’s Estate

A man named Stephen Jackson has been found to have stolen almost one million New Zealand dollars from his dying mother. The man actually sold his parents’ house whilst his mother was in the process of writing her will – even though that will said that Ivy Jackson wanted to split the property between her three children. However, by the time she died the house had already been sold and it was too late to do anything about it.

Stephen Jackson then took a further $250,000 from his mother’s bank account after she passed away.

Only one of Mr Jackson’s siblings was living at the time of their mother’s death, and the High Court in New Zealand found in favour of that sibling, Raymond Jackson. It was found that Stephen and his wife Linda owed almost $1.1 million, plus interest, to the estate of his dead mother.

But how could this have happened in the first place?

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In January 2014, Ivy Jackson suffered a stroke and was unable to return to her home. Knowing that she was very unwell, she proceeded to write a will which, two days later, was completed. The will stated that she wanted the house to be sold, and for the proceeds from the sale to be shared between her children equally. Everything that was left over would go to Stephen and Linda Jackson.

However, because Stephen had been made power of attorney after his mother’s stroke, he had already made arrangements to sell the house.

Ivy Jackson died one year later after spending 12 months in a nursing home. Stephen said that he had had to sell the house in order to pay for the home (and the payment for it does seem to have come from the proceeds of the house sale). However, Ivy had enough put into savings to pay for these fees without the need to sell the house at that time. And, despite some of the money being used for the care home, almost $600,000 was still unaccounted for when the case went to court.

On top of that, it was discovered that Stephen Jackson used his status as power of attorney to withdraw around $300,000 from a joint account that had been held by his mother and father.

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And, although they were both named as executors in Ivy’s will, neither Stephen nor Linda actually executed it, and instead continued to make withdrawals from a variety of different accounts.

The couple did not attend the hearing and they cannot be contacted, although it is thought that they have since moved to Queensland. The case is therefore ongoing. 

Prince’s Estate Becomes More Complicated

In April 2016 the world lost a musical icon. Prince died unexpectedly in his home in Minnesota. The problems regarding his estate began immediately since Prince (whose full name was Prince Rogers Nelson) had no will. This meant that his estate had to go through the intestacy rules, but Prince’s family is a spread out and complicated one, and so the entire process of portioning out the estate is still not complete.

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The current problem stems from the fact that there are two lawyers who are attempting to represent Prince’s potential heirs, and the judge overseeing the case is refusing to appoint either one of them to the job. This is because there is disagreement between the remaining siblings as to who to use. The two lawyers – both very experienced in their field – effectively interviewed for the job of dealing with Prince’s estate recently, but the six siblings and half siblings of Prince are split over who to use. The judge has declared that if they cannot reach a consensus then he will work on a majority of four to two. But the issue is literally split down the middle.

Minnesota law means that Prince’s estate and assets should pass to his sister, Tyka Nelson, and his five half siblings equally because he had no children and his parents are dead. However, there have been a number of other claims from people who say that they are also half siblings of the singer, and until the claims are all looked at, the judge cannot – and will not – begin splitting the estate between the six who will definitely inherit something. 

Estate Manager Must Pay Back Funds

Jamaica. At that time, there was more than one application for the grant of letters of administration submitted. The first was from someone claiming to be Ms Lyons’ niece, Audrene Kerr-Robinson. She was given the grant in February 2012. However, this was soon determined to be a mistake when it was discovered that Kerr-Robinson had no claim to the estate.

Although she was contacted by the Principal Probate Registry, there was no response.

The other applications, which had been unsuccessful, had been from Jonathan Kerr and George Lyons. They proceeded to challenge Ms Kerr-Robinson’s claims. They were both close relatives, but Kerr-Robinson, an accountant, was not – or so they said. So that they could stop the estate being broken up and distributed to the wrong people, the pair employed an estate administrator to ensure that everything was kept together while their claim was looked into.

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Kerr-Robinson’s grant was revoked due to the initial error, and she was requested to pay £20,000 as well as some of the estate assets to the interim administrator.

In order to refute this claim, Ms Kerr-Robinson hired Blueprint Property Lawyers to appeal on her behalf. This cost almost £87,000 even though the company were not probate lawyers (and therefore should not have been involved in the case) which was taken from the estate.

Eventually, it was determined that that money would have to be returned. Unfortunately, Blueprint Property Lawyers had gone into insolvency, and this meant that Ms Kerr-Robinson was liable for the cost. She should, said the judge, not have used the estate that was in dispute to pay bills relating to it. 

Should everyone think about inheritance tax planning?

Inheritance tax planning sounds like something that only the rich and famous need to really think about, but is it actually something that everyone should consider? Although it may seem as though it’s only something that affects other people, inheritance tax can actually affect anyone and everyone, so ensuring that your estate won’t fall foul of the laws is an important part of creating your inheritance plan.

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Inheritance can affect more people than you might think because once you add up your estate – savings, belongings, life insurance proceeds, your pension, and your property, it could well be over the threshold for having to pay inheritance tax. When property involved this is even more likely since house prices are rising.

There is an inheritance tax allowance of £325,000 on any estate. If the estate is worth more than that then tax will be owed on the ‘extra’ amount, and it is payable at 40 percent. However, if you have a spouse or a business interest (or both) then it is possible to carry out inheritance tax planning through your will. It could be that inheritance tax won’t be due at all since there is a spousal exemption from the tax, and also business tax relief.

If you are single, living with a partner but unmarried, or you have no business then your will may not be able to help you reduce inheritance tax. But there are other things you can do. For example, everyone has an annual inheritance tax exemption of £3,000 which can be used to give gifts. If you give more than £3,000 the rule is that you must ‘outlive’ the gift by a further seven years (otherwise it could still be subject to inheritance tax).    

The best thing to do is to contact an expert who will be able to talk you through your options and reduce your liability for inheritance tax as much as possible. 

Can You Overpay Your Inheritance Tax?

Inheritance tax can, at first, be an inexact science. Although it may seem as though it is something that can be calculated exactly, there are various factors that mean it is sometimes overpaid. Equally, your inheritance tax payment can be underpaid too. Why is this?

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When someone dies the estate will often have to pay inheritance tax (IHT), assuming the estate is worth enough for the government to charge IHT on it. The executor will need to fill in a tax return and pay the money calculated to HMRC. Only after this will they be able to obtain probate and distribute the assets.

The difference in the figures comes when an asset – for example a property – is sold for more or less than the valuation. With properties this is very common, and they do often sell for less than the asking price. However, the tax returns and the payment will already have been made at this point, and therefore the overpayment will need to be recovered. Equally, if the property (or other asset) sold for more, an additional payment will have to be made.

If an overpayment has been made then you will need to contact the Capital Taxes Office (CTO) which is part of HMRC. Unfortunately the process of recovering money like this can take many months, even in the most straight forward of cases. This can cause a major impact on the distribution of the rest of the estate, as everyone has to wait until the money is returned. 

A 9,200% Increase In Probate Fees?

Are there really plans to bring in a ‘stealth tax’ that means probate fees could rise by up to 9,200%? It seems so. And this could bring additional hardship down on those who are already grieving and having to deal with the estate of their deceased loved one.

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At the moment, probate fees are £215. This is a flat fee that is due on any estate worth more than £5,000. However, the new rates that are potentially being introduced could mean that the lowest probate tax that will be paid is £300, and this is on estates worth between £50,000 and £300,000. The rate is to be set at £20,000 for estates in the region of £2 million or more.

And although it may seem as though it is only the ‘rich’ who will have to pay such high costs, with rising property prices more and more people are being pushed into the higher bands. It is suggested that the government could raise over £250 million every year from these new tax rates, and the Department of Justice’s justification behind it is an increase in the administration behind probate since estates are often larger – and growing – and take more time to process. But is that £250 million going to go towards paying staff?

Despite the increase, it is estimated that 30,000 beneficiaries will not have to pay anything as they estates they inherit will be between £5,000 and £50,000. Under the current system they would have been liable for £215.

The new plans mean that there will be a 40% rise for estates between £50,000 and £300,000 (currently £215 this will rise to £300). For estates between £300,000 and £500,000 it is a 365% rise (£215 to £1,000). Estates between £500,000 and £1 million will see a 1,760% rise (£215 to £4,000). Estates between £1 million and £1.6 million will pay a 3,621% rise (£215 to £8,000). Between £1.6 million and £2 million it is a 5,481% rise (£215 to £12,000). And for anything over £2 million it is a 9,202% rise (£215 to £20,000). 

How Long Will It Take To Deal With Prince’s Estate?

Superstar singer songwriter, Prince, died in April in what we now know was an accidental overdose of pain medication. The problem – amongst many – was that no will was found to deal with his $300 million estate.

Now at least five half siblings as well as his full family have laid claim to the estate, and more still have suggested that Prince told them they would be left something in his will. But since there was no will, difficulties have occurred.

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The judge in Minnesota who is presiding over this case has said that he is in no hurry to have it settled. Judge Kevin Eide, Carver County district judge, wants to ensure that he has all the facts and all the information before he has to make a final decision. There is a lot of money and many claimants to sift through first. And that’s not to mention the coterie of attorneys and lawyers who are working on behalf of Prince’s estate – there are at least two dozen of them.

Judge Eide has suggested that he might have to pass the parentage question – ie, who is actually related to Prince, and who is only saying that they are – to a higher court as DNA testing will most likely be used to determine who is who. This of course will make the process take even longer. 

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How To Value An Estate

Before an estate can be executed correctly, it needs to be valued. And it is one of the executor’s jobs to do the valuing. It is especially important to get this right if the will of the deceased person dictates that a certain percentage of the estate must go to someone – it would not be possible to work out how much money that is exactly without knowing how much the estate is actually worth.

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It is important to know the value of an estate for inheritance tax purposes as well.

It is an incredibly important part of being an executor, and because of this it can feel rather overwhelming. There is no need to worry, however – as long as the valuation is carried out in a clear and concise way, following the logical structure of things, it will work out in the end.

Included within the valuation are money, assets, property, and general possessions. Money includes all the money in every account that the deceased has, as well any cash that is actually in their home or even wallet or purse. It includes stocks and shares, pensions, and life insurance policies too. Assets include businesses, and it can be useful to engage a solicitor to deal with this. Property includes all buildings and land. Possessions are things such as fittings and fixtures, clothing, vehicles, jewellery and more.  

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Gifts that the deceased gave away but kept an interest in – knows as ‘gifts with reservation of benefit’ – also need to be included within the estate’s value. This could be a house that they gifted to someone but remained living in, for example. There are some gifts that are excluded, however. These include gifts to spouses or civil partners, gifts that were made more than seven years before the death, wedding gifts, and maintenance payments.

It can be a minefield of confusion when it comes to carrying out this valuation – so why not contact the experts who can help you out? 

Can Frozen Sperm Inherit Your Estate?

It sounds crazy, doesn’t it? It sounds like a story from a soap opera or melodrama. But actually, could a child conceived using your frozen sperm actually go on to inherit your estate? Well yes – they could. This is the 21st century version of an illegitimate child turning up to inherit a Victorian estate. Only in the modern day version, the child would probably have been conceived after your death. It all sounds rather confusing, complicated and not a little macabre, but it is entirely possible.

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After all, isn’t that what frozen sperm is all about? Isn’t it saving a little of yourself (literally, in this case) for after you’ve gone, so that you can – in some small way – continue to live?

But since that is the case, it could be in some people’s interests to ensure that they consider this issue when they make their wills. It may sound strange to consider children who don’t currently exist, and possibly never will, but it is the best way to cover every eventuality. Because anything can happen when you die but leave behind not only an estate but genetic material too. And this could add an heir, even after you have gone.  

Already a New York court has ruled that a posthumously conceived child is a descendent nonetheless, and can therefore receive an income from a family trust. It is slightly different in Florida and California, however. In those USA states the child must be born within 36 months of the father’s death in order to have any claim to any inheritance right.

But the best advice for those who have left sperm – or eggs – in frozen form for future use is to make a will that states specifically how and when those pieces of genetic material should be disposed of and, if any children are conceived using them, if they should have any of the inheritance at all.  

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Another Celebrity Without A Will – Prince Dies Intestate

Celebrities may have a completely different life to the ‘normal people’ who look up to them – they may have more money, go to more parties, win more awards… but when it comes to writing a will, they are just as forgetful as the rest of us. And yet, due to the huge fortunes that many of these well known people amass, they are in just as much need of writing a will as anyone else. Otherwise what will happen to the money, the property, the cars and jets and businesses?

It’s a lesson that Prince should have thought about. However, the 57 year old singer’s unexpected death on 21st April 2016 has revealed that the icon never actually made a will, despite his assets being worth hundreds of millions of dollars. The final figure is yet to be established as there are so many different revenue streams to tie up.

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Due to the fact that Prince had no will, his estate has been found to be intestate. There are specific rules that need to be followed to work out who would inherit and how much, and because Prince was not married, had no surviving children, and his parents were both deceased, the bulk of the estate will most likely fall to his six siblings equally. However, since there was no will probate will take much longer and cost much more than it otherwise would have done.

Not only that, but there is no executor for the estate, and therefore Prince’s bank has been named as the ‘special administrator’ in order to try to straighten things out.

One of Prince's assets is his home and recording studio, Paisley Park.

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And there is one more potential issue. A woman named Darcell Gresham Johnson has stepped forward to claim that she is another of Prince’s siblings. She says that she and the singer-songwriter had the same mother, and she is petitioning to receive a portion of Prince’s estate.

This declaration will add another layer of confusion to a messy estate and asset list, and will also add more time to the case as steps are taken to prove Johnson’s story. 

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