What’s Next for Robin Williams’ Family and Estate?
The initial shock of Robin Williams’ tragic death, from an apparent suicide, is giving way to reflections of his legacy and memory. Another question many people are asking is what happens next for his family. He was survived by his third wife, Susan Schneider, to whom he was married for three years, and three adult children from his prior two marriages, whose ages range from 25 to 31. There is a realistic fear that Williams’ death may have left them in financial distress.
In an interview with Parade Magazine last year, Williams lamented how he had to change his lifestyle because of how much he lost in his two divorces (reportedly, $30 million). He said he returned to TV because of “bills to pay.” Williams also admitted to listing his Napa Valley estate for sale because he could no longer afford it.
Public records about Williams’ real estate show that they have significant value. His Napa Valley mansion, which rests on 653 acres and is named Villa Sorriso (translated to the Villa of Smiles), has been on the market since April for $29.9 million. Williams also left behind a 6,500-square-foot waterfront home in Tiburon, California, valued at roughly $6 million. The two properties are subject to mortgages, according to public records, that totaled $7.25 million as of 2011. This means that Williams left behind real estate with equity of around $25 million, depending on what Villa Sorriso can command in a sale.
How much more than that did Williams leave behind for his heirs? While he was reportedly worth around $130 million two years ago, that figure seems well off since Williams later said that he was close to bankruptcy. Recent estimates have pegged his net worth at $50 million, which may also be high based on his reported financial struggles.
Any estimate of his net worth before he passed away would only be part of the financial picture. Lifetime estimates would not factor in the death benefit from life insurance, which could be substantial — especially considering that high wage earners are often required to take out insurance policies to protect their families as part of divorce settlements.
The good news for his family is that Williams appears to have some solid estate planning documents, including at least two different trusts. Both of his valuable pieces of real estate are held in the name of the “Domus Dulcis Domus Holding Trust.” This is a latin phrase meaning “home sweet home.” He set up this Trust to own his real estate, tabbing Hollywood producer and entertainment promoter Stephen Tenenbaum and New York accountant Joel Faden as the trustees.
Additionally, TMZ reported that someone had leaked a copy of a different trust, which Robin Williams created in 2009. This was in the midst of Williams’ divorce from his second wife, Marsha Garces. The trust reportedly names Williams’ three children as beneficiaries, splitting their trust funds into three equal distributions for each of them, set to pay out when they reach ages 21, 25, and 30. Because this trust reportedly transfers the money to them whether Williams was alive or passed, this was likely established as part of his divorce rather than purely for estate planning. It is not known how much money was in this trust.
Regardless of the motivation behind this trust, it (and his real estate holding trust) show that Williams took advantage of sophisticated estate planning to protect his loved ones. Many celebrities, like Philip Seymour Hoffman, feared using any type of trust. Williams had at least two trusts, and it appears that the Domus Dulcis Domus Holding Trust was done, at least in part, to minimize estate taxes. Real estate holding trusts, when made irrevocably and established and used the right way, can often carve valuable real estate outside of someone’s taxable estate. With the $25 million or so in equity, this could add up to a substantial savings for Williams’ family.
Even if this trust was not set up with estate taxes in mind, if nothing else it worked to safeguard privacy for Williams and his family. When used properly and not leaked to the media or revealed due to litigation, trusts allow celebrities and non-celebrities alike to avoid probate court and keep their affairs private.
While the real estate, the children’s trust funds, and any life insurance will not technically be part of Robin Williams’ estate, his ongoing royalties, earnings from new deals over his image and likeness, and future releases of his comedy material would be managed through his estate, unless he had previously assigned those rights to another trust or a corporate entity. These should add up to significant value.
According to numbers compiled by ABC News, his movies grossed over $6 billion throughout his career, more than half of which came with Williams as the leading man. He was paid $165,000 per episode for his one season of The Crazy Ones — a big improvement over the $75,000 payday he earned for voicing the Genie in Aladdin (despite the film’s $500 million earnings).
There can be no dispute that Robin Williams was a comic genius, as his Oscar, two Emmys, and four Golden Globe awards attest. The early indications are that he displayed some genius with his estate planning as well. While nothing can make the horrific loss of Robin Williams better for his family, at least he appears to have taken the proper steps with his legal planning to avoid the pain from becoming worse.
It’s a lesson that others can learn from. While few people will need the sophisticated type of estate planning that Williams used, a revocable living trust can help anyone who wants to help their loved ones avoid the pain, cost, stress, and publicity of probate court. Because of his foresight, Robin Williams’ family can focus on grieving and not have to worry about unnecessary complications with his estate.
(Culled from www.forbes.com)