Nationwide — Aretha Franklin, the Queen of Soul, is a legend that will never be forgotten. But with all due R-E-S-P-E-C-T, the IRS is probably singing with joy because she reportedly left no will when she died. Apparently, she did nothing to shelter her assets from the Taxman. “The IRS will eat 40 percent of Aretha’s estate with the death tax,” says celebrity tax advisor Jayson Thornton of Thornton Tax Firm.
But the Estate taxes could have been limited. Thornton says Franklin could have set up an estate plan with trusts to benefit any relatives and charities she chose, while leaving very little if anything to be taxed. “When Black celebrities die, their money normally goes to 4 places; family, friends, charity, and the Taxman,” said Thornton.
Not settling up a trust that would have given Franklin’s beneficiaries set amounts; they now have to fight over the Taxman’s leftovers.
For 2018, the estate tax exemption is $5.6 million per individual. That means an individual can leave $5.6 million to heirs and pay no federal estate taxes. A married couple will be able to shield $11.2 million from federal estate taxes. Aretha Franklin died with a reported estate net worth of $80 million, which could end up paying almost $27 million in Federal Estate Taxes.
About Thornton Tax Firm, LLC
Thornton Tax is a St. Louis, MO based African American accounting firm that specializes in tax law for clients in the Sports and Entertainment industry in tax compliance cases, tax preparation and IRS tax debt settlements. For more information, visit www.ThorntonOffice.com.
About Jayson Thornton
Jayson M. Thornton is a tax advisor and enrolled to practice by the United States Department of Treasury. He is also a certified public accountant (CPA) candidate for the State of Missouri. Thornton earned his associate degree in Accounting from St. Louis Community College, and bachelor’s degree in 2006 from Missouri Valley College as an honors graduate.