Attorney Thomas B. Burton discusses the will of the Former First Lady of the United States, Ms. Jacqueline Kennedy Onassis, in this latest episode of the Wills of the Rich and Famous.
In this series, we will be using illustrations from the Wills of rich and famous people to illustrate important estate planning lessons. In today's video we examine Ms. Jacqueline Kennedy Onassis's Will and discuss how everything was taken care of.
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Welcome back to Wills of the Rich and Famous, I'm your host Attorney Thomas Burton and today, we once again return to the book 'Wills of the Rich and Famous' by Attorney Herb Nass, Esq. to turn to another important example of estate planning.
In this series, we're using the wills of the rich and famous, familiar figures to a lot of us and the public, to look at how they set up their estate plan, in order for you to use these tips when creating and preparing your own estate plan.
Today, we're looking at the will of Jacqueline Kennedy Onassis, the surviving wife of President John F. Kennedy and I'll read you a bit of excerpts from the book and then we'll discuss the key takeaways.
It says, "The lengthy and sophisticated will of Jacqueline Kennedy Onassis reveals what a sensitive, generous and thoughtful person she was. Jackie's will which was signed less than two months before she died includes numerous detailed bequests such as the following gifts of tangible personal property to people very important to her."
Now as a reminder, Tangible Personal Property is all those items you possess which don't contain a title. So it's things around the house like your artwork, your rugs, your furniture, jewelry and you can imagine and Jacqueline Kennedy Onassis's case, she was well known for her style, so a lot of this items of tangible personal property, did have significant value.
"For example, to my friend Maurice Tempelsman, my Greek alabaster head of a woman, to my friend Rachel Bunny Mellon, in appreciation of her designing the rose garden in the white house, my Indian miniature 'Lovers watching rain clouds, Kangra' about 1780 and my large Indian miniature with giltwood frame, 'Gardens of the palace of raj', a panoramic view of a pink wild garden blooming with orange flowers."
So that's just an example she's giving artwork to friends, "And to my friend, Attorney and Co-Executor Alexander D. Forger, my copy of John F. Kennedy's Inaugural Address signed by Robert Frost."
So, wow! What a bequest to her friend, attorney and executor that Inaugural Address signed by the famous poet Robert Frost.
After these very specific bequests, Jackie provide that the balance of her tangible personal property including "My collection of letters, papers and documents, my personal effects, my furniture, furnishings, rugs, pictures, books, silver plate, linen, china glassware, objects of art, wearing apparel, jewelry, automobiles and their accessories and all of their household goods owned by me were to pass in equal shares to her children Carolyn and John."
The author says, "It is noteworthy that Jackie's will also contain the legal mechanism whereby the children could renounce and disclaim their respective interests in the tangible personal property within nine months of their mother's death", so here's an important illustration of a disclaimer provision in a will meaning someone is left a gift, an inheritance but they could choose to disclaim it, saying, "I am not going to accept the gift" and this is established under federal tax law and under state law but in her will, Jackie provided what would happen if the children issued a disclaimer.
"It would have then passed as follows - such items which relate to the life and work of my late husband, John F. Kennedy to John Fitzgerald Kennedy library incorporated Boston, Massachusetts."
So she left them if her children didn't accept, if they disclaimed, they were to go to the John F. Kennedy Library.
"The balance of said tangible personal property shall be sold and the net proceeds shall be added to my residuary estate".
Now the author tells us, "In fact, Carolyn and John chose not to renounce the vast bulk of the tangible personal property bequeathed to them and it was that property which sold at a memorable auction at Sotheby's, that grossed close to 35 million dollars for Carolyn and John and she died in 1994.
So if you can imagine, 35 million dollars in 1994 would be worth an even greater amount of money today. "Unfortunately", the author says, "John and Carolyn's well-known uncle Sam wanted his piece of the Kennedy Onassis pie and there were substantial United States and New York Estate taxes paid by Jackie's estate. It was those taxes and substantial administration expenses which ultimately depleted the residuary estate, so that the charitable lead trust contemplated under the will and praised as a brilliant estate planning technique in the press, after Jackie's death was never funded".
So she had set up this charitable lead trust but all these expenses ate away at the estate, it was never funded, so one thing I would point out here is New York State is a very expensive state to die in and she resided there at death. So they imposed their own state estate tax in addition to the federal estate tax. So one thing Jacqueline could have done is perhaps move to Florida where there's no estate tax and if she had died there, she could have avoided state estate tax on the estate, leaving more money to fund that charitable lead trust.
The other thing is it says the administration consumed a lot of expenses and I noticed she used the will here versus a trust which I'm not aware of the probate court fees in New York but given the tax system is likely the probate court fees are also significant and the attorney fees for this all to go through the court process, she could have avoided some of that through the use of a private trust.
Regarding her copyright interests in her personal papers, letters or other writings by me, Jackie bequeathed those equally to her two children, however her will also provided, "I request but do not direct my children to respect my wish for privacy with respect to such papers, letters and writings and consistent with that wish to take whatever action is warranted to prevent the display, publication or distribution in whole or in part of these papers, letters and writings", and the author states, Jackie's well-known predilection for privacy even extended after her death and there's no surprise that our surviving children endeavored to respect her wishes. So that's a key phrase you could borrow there, "I request but do not direct", so if you want to make a very strong request but not make it mandatory, that's one way to communicate it in writing to your heirs.
As a result of her marriage to Greek shipping magnet Aristotle Onassis, Jacqueline K. Onassis as she refers to herself in her will, died a very wealthy woman. Her will indicates her wealth by the number of generous cash bequests which she makes to various friends, relatives and employees. There is a $5,00,00 ten year, 10% annuity trust established for each child of her sister Lee B. Radziwill. So she put a half a million into a trust for each of her sister's children. Ever the politician's wife, Jackie states in her will, "I have made no provision in this will for my sister Lee B. Radziwill for whom I have great affection because I have already done so during my lifetime. I do wish however to remember her children".
The will also includes the following cash bequests to the following persons on the condition that they survive her. So again, here's a clause you can consider in your estate plan, the condition that someone survives you. Now it's up to you how you word a bequest in your will but in general, if you only want it to go to the person if they survive you, you would say that in the paragraph and you would say "if they do not survive me this gift shall lapse", meaning it doesn't go to their heirs.
So for example she left $2,50,000 to Nancy Tuckerman, a $1,25,000 to Martas Scuban and a $1,00,000 to niece, Alexandra Rutherford and more. There was also a bequest of $2,50,000 to each child of mine who survives me which brings the grand total of the cash bequest to over 1 million dollars. So just remember, even if you leave your estate to your children like she did, the ultimate distribution, you can also leave them a cash gift off the top, if you know you have significant cash. That cash bequest can be made and sometimes that could be distributed even before, quicker than the rest of the estate which may require selling assets to distribute but in any event, it can ensure the heir gets that cash amount off the top before other things are distributed. That's generally when I'm drafting a will or trust, we make the cash bequest first and then the ultimate what we call 'Residuary Distribution' is included at the end.
So the author says, "Jackie's investments included valuable real estate and a magnificent cooperative apartment located at 1045th avenue New York, New York, that cooperative apartment was subsequently sold for close to 10 million dollars and all of her real property in the towns of Gay Head and Chillmark, Marthas Vineyard, Jackie devised and bequeathed to her two children in equal shares. So she left all the real estate to the kids in equal shares and again, real estate would be something that you could ideally leave in a trust versus the will, she could have kept it private, outside of her will and avoided probate court on the value of that 10 million dollars plus of real estate by passing it through a private revocable living trust instead of using the will.
He says, "Tragically it was only several nautical miles away from her property in Martha's vineyard that Jackie's son john died in a tragic plane crash in 1999, five years after she died."
"She also left her farm in Newport Rhode Island known as Hammersmith Farm which she inherited from her mother to her half brother Hugh D. Auchincloss Jr. or if he had not survived her, to his children in equal shares".
Although her will does not refer to the name Kennedy, in her own name, opting for the initial K instead there are numerous references to her late husband who died over 30 years before she did. For example, her will state, "Under the will of my late husband John Fitzgerald Kennedy, a marital deduction trust was created for my benefit over which I was accorded a general power of appointment. I, hereby exercise such power of appointment, direct that upon my death, all property subject to such power, shall be transferred, conveyed and paid to my descendants who survived me, Per stirpes."
So the Kennedy family itself was very well off and John Fitzgerald Kennedy had several trusts, some of which were set up by his father and he set up this trust for his wife called the marital deduction trust and the Kennedy's are well known to have made use of trust to avoid and minimize estate taxes upon death. So what Jackie had was what's called a general power of appointment to direct the assets in this trust after her death and she exercised that in her will and left whatever was left, to her two children in equal shares.
So now we get to this charitable lead trust, after all of the foregoing bequests, Jackie's will contemplated a charitable lead trust, composed of her residuary estate and the residuary estate is everything that's left over after these specific bequests we discussed. The charity which was intended to receive the income from that lead trust for 24 years was to be the C&J Foundation named after her two children with the remainder passing to her descendants living at that time. If none of Jackie's descendants were living, the remainder would pass one half to the living descendants of Jackie's cousin Michel Bouvier and one half to the living descendants of her sister Lee B. Radziwell.
So the trustees which was her two children and friend Templeman were directed to pay the income to qualified charitable organizations with Jackie expressing her wish that in selecting the particular charities, the independent trustees give preferential consideration to such eligible organizations, the purposes endeavors of which the independent trustees feel are committed to making a significant difference in the cultural or social betterment of mankind or the relief of human suffering.
She also authorized her close friend Nancy L. Tuckerman to assist them in the administration of the foundation but as the author states, unfortunately the best laid charitable plans went astray in this case as there was no residuary estate remaining after taxes and expenses to fund that charitable trust.
So remember, Jackie left that money, the personal property to her children and they sold it for 35 million and divided it amongst them and then the real estate was left directly to the children which is also a significant amount. So the residuary clause was to fund this, residuary estate and there was ultimately nothing left after expenses in administration.
So one last lesson from Jackie's will we can learn here is choosing your executor, the person in charge of administering your estate after you're gone, what we call the personal representative in Wisconsin. Jackie's choice of executors is noteworthy despite the fact that each of her children John and Caroline were attorneys and quite close to their mother, she did not name either one as an executor of her will. Instead, she named her Attorney Alexander D. Forger and boyfriend Maurice Tempelsman as executors. Perhaps she felt that her children would be too grief-stricken to properly fulfill the numerous, numerous obligations of an executor of the will.
So this is an important reminder that just because you're leaving someone something as an heir in the will, does not mean you have to name that person as the executor or the person in charge of the estate. You can name an independent third party like Jackie did with her attorney and friend or you could name someone like a trust company, where they have people on staff to administer estates for a fee, after you're gone.
He concludes by saying the first widow who fascinated the world left the will which also continues to fascinate. She signed that will in her apartment on fifth avenue less than two months before she died from cancer at age 64.
Although she survived her two husbands, one asked to wonder whether she could have survived the untimely death of her 38 year old son. John died with his wife and sister-in-law while piloting his own plane in a tragic nosedive into the ocean short of his mother's former property on the island of Martha's vineyard off the coast of Massachusetts where the Kennedy family had already made so many big splashes. The will was dated march 22nd 1994 and signed at 1040 fifth avenue New York, New York and that my friends, is the will of Jacqueline Kennedy Onassis.
As you went through this episode with me today, you see there's several very interesting examples from her will that you can think about and implement where appropriate in your own estate plan, along with the advice and counsel of your estate planning attorney.
So thank you for tuning in to this episode of Wills of the Rich and Famous. if this episode has been helpful to you, please consider giving it a LIKE, so that others can see and benefit from this information as well.
Thanks for tuning in and we'll see you next time.
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