Readers in Nevada may be interested to learn that the heirs of George Lucas, famed director of the Star Wars movies, may have avoided potential tax problems and planning issues over his high value estate recently. This may be because the director recently sold his movie business for more than $4 billion dollars to Disney. The sale was made in stock and cash and is a part of an estate planning move that may have been designed to limit some taxes.
Reports indicate that a part of the reason for the sale of the movie business by Lucas was that none of his heirs appear to have been interested in continuing the business. The sale will free the heirs of the need to divide the business after their father’s death. Instead, the director has said that he intends to use much of his wealth for charitable purposes while he is still alive.
In addition to limiting the chance for future litigation, the sale by Lucas also may have saved his estate many dollars in taxes. This is due to the fact that the rules for capital gains taxes are favorable during 2012, a fact that may change in 2013. Currently, the rate for gains such as those made by Lucas is 15 percent. Next year, those same rates are expected to jump to 20 percent.
Planning for an estate that benefits both an individual and their heirs can be challenging, as many in Nevada know. Using this type of sale, even some with much smaller businesses than that of Mr. Lucas can still benefit in the same way. There are many different estate planning tools that are available for all who seek to plan for the division of their assets after their deaths, and a full review of each may benefit not only the individual but also their potential heirs.
Source: The Wall Street Journal, “George Lucas’s Jedi estate planning,” Quentin Fottrell, Nov. 1, 2012