Tuesday, October 11, 2011

Steve Jobs's"Amazing" Estate Plan

I have no way of checking this story - only Steve Jobs's family and estate attorneys know the facts for sure - but it seems reasonable to assume that the authors have done some pretty thorough research.

Steve Jobs, of course, died a very wealthy man. Most estimate put the wealth of one of Apple's founders in the neighborhood of $6 billion or so.

However, it appears that his estate tax bill will be essentially nothing.

According to this article which appeared on The Trust Advisor Blog, after Jobs had his first brush with death in 2003 he put the vast majority of his assets in trusts.

Most of Jobs wealth was in the form of three huge stock positions: Disney (he was a 7% owner); Pixar; and, of course, Apple. Since these assets were moved into trusts, so none of them would be part of his estate.

His house would have naturally gone to his wife Laurene (as the surviving spouse) but apparently he put this in trust also.

Jobs was famous for not taking a salary from Apple in recent years, which meant that he probably had little in the way of assets other than his stock holdings.

His estate plan would also explain why Jobs did little in the way of large philanthropic gifts like his fellow billionaires Warren Buffett and Bill Gates. Since most of his assets were in trusts, and he didn't have any salary from Apple, he might simply not have had the money.

Here's an excerpt from the blog:

Given his efforts to keep his personal life private, we won’t ever know exactly how his estate plan allocates his wealth — unless, of course, he wanted the world to know.

We do know that it involved a network of at least two trusts. California records show that he and his wife, Laurene, moved their Palo Alto house and other real estate into two trusts when his liver was failing in early 2009...

Completely under the radar, SEC filings reveal that Jobs was also busy moving the rest of his material wealth — 5.5 million shares of Apple stock and 138 million Disney shares, a memento of his other baby, the animation company Pixar — out of his estate and into a trust.

Since he basically earned nothing from either Apple or Disney since then, it’s possible that he died with no real assets in his name...


Given the elegance of the products he designed, it is not surprising, I suppose, that his estate plan was so clean and effective.

Or, as he might have said, it's "amazing".