A previous post mentioned that this is the year for billionaires to die without their estate being responsible for any estate taxes. One of this country’s billionaires is Donald Bren of the Irvine Company in California. Estate taxes were far from his mind when this week in Orange county, a jury decided the interesting case of whether he owed his biological children by a mistress approximately $130 million in back child support. The causes of action brought by the mistress and the two children, now 22 and 18, were based on fraud and breach of contract on the premise that Bren had not given enough emotional and financial support to the children. At one point Bren was giving each child $18,000 a month. The children claimed that he was required to pay them support according to his “circumstances and station in life,” arguing that he should be required to pay them $400,000 per month applied retroactively.
Bren, now 78, has an estimated net worth of $12 billion dollars and is married with a 7 year old child. The jury decided in favor of Bren and ruled that the children were not entitled to additional support. So now Bren’s billions are intact and he can plan for how best to leave his billions without paying billions in estate taxes. Next year unless the Legislature acts before the end of the year, the federal estate tax exemption is set to return to a level of $1 million. Millions of Californians will then have estate tax issues just like Donald Bren. There are ways to minimize estate taxes including irrevocable life insurance trusts, gifting, and other advanced estate planning techniques.
If you have questions or want to consult with an experienced estate planning attorney about your estate and how to minimize estate taxes, call us at Scott C. Soady, A Professional Corporation for a free consultation. Also go to our family law website where you can read articles about child support and other family law issues. Consultation for family law are also available.