Hugh Hefner Has Restrictions for His Heirs

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Hugh Hefner Has Restrictions for His Heirs

Before Playboy Magazine founder Hugh Hefner died in September 2017, he carefully planned his estate to ensure his wishes would be honored after his death, to avoid probate court, and to maximize the tax efficiency of asset transfers. In addition to identifying the beneficiaries of his estate, Hefner’s trust agreement reportedly also included stipulations designed to ensure his wife and children do not abuse alcohol or drugs.

Hugh Hefner has restrictions for his heirs

According to Entertainment Tonight, Hefner’s trustee has the right to suspend mandatory distributions, withdrawal rights and rights to participate in trust decisions of any beneficiary who “routinely or frequently” uses or consumes legal or illegal drugs or alcohol to the point where the beneficiary is physically or psychologically dependent on the substance. The trustee can ask the beneficiaries to take drug tests when abuse is suspected. If substance abuse occurs, and if the trustee reasonably believes that the beneficiary cannot care for himself or herself or manage their own financial affairs as a result, the beneficiary will not be eligible to receive distributions.

Fortunately for trust beneficiaries who lose their rights because of substance abuse issues, the trust also provides a mechanism for restoring those rights. Under Hefner’s trust, a beneficiary who loses trust distributions can have them restored after 12 months of clean and sober living, if the trustee reasonably believes the beneficiary will be able to manage his or her affairs again.

One aspect that many people find appealing about the use of trusts for estate planning is that they can provide the ability to control from beyond the grave. The restrictions included in Hefner’s trust illustrate this power well. In certain situations, well-intentioned restrictions could potentially be problematic; it’s impossible to think about every possible scenario that could occur and plan for it; restricting distributions may have unintended consequences. If you are considering including restrictions for your trust beneficiaries, discuss your wishes with your trust lawyer who can help you evaluate benefits and drawbacks.

From estate planning to trust administration, we help you from start to finish. We work with families at all stages of their lives to help protect their futures. Our services are customized to your specific goals and will alleviate your unique concerns. Contact us today to learn more!