Michael Jackson - Michael Jackson estate owes $702 million?

Michael Jackson's estate is being pursued for $702 million in taxes.

The Internal Revenue Service (IRS) accused the late 'Thriller' hitmaker's executors of significantly undervaluing assets following the singer's death in 2009, and has launched a legal battle in a bid to secure $505 million and an additional $197 million in penalties.

In U.S. Tax Court documents in Washington, obtained by the Los Angeles Times newspaper, the agency claims the estate inaccurately placed the star's net worth at slightly more than $7 million when Michael died after an overdose of a surgical-grade anesthetic, and argue he was actually worth $1.125 billion.

The IRS said that the estate's original tax return was so inaccurate that it qualified for a gross valuation misstatement penalty, which would allow the government to double the usual 20 per cent penalty for underpayment.

Most of the dispute centres on the value of Jackson's image and likeness, which the estate placed at just $2,105 and the IRS believes should have been $434.26 million.

The agency also valued the star's interest in a trust that includes the rights to some of his biggest hits and most of the Beatles catalogue, including 'Yesterday,' 'Sgt. Pepper's Lonely Hearts Club Band' and 'Get Back,' at $469 million but the estate gave it zero value.

The IRS also believes Jackson's interest in another trust was worth $60.6 million, not $2.2 million, as the estate claimed.

If the court rules in the IRS' favour, the estate could be forced to sell some of its assets or strike a deal to pay back the money over 15 years.


Contactmusic

Tags: Michael Jackson - Beatles - Katherine Jackson


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Comments

Marco Balletta's picture

Marco Balletta

This is the MJ Estate's executor talking about the value of MJ' share of Sony/ATV,claimed to IRS $0.00 http://t.co/Jr4DtgX038

5 months 1 week ago
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Marco Balletta's picture

Marco Balletta

#MJFam The day Michael Jackson Estate will be found liable for tax EVASION , THE EXECUTORS will pay IRS off by selling their OWN personal assets , because EXECUTORS ARE LIABLE and NOT Beneficiaries !!! Beneficiaries will request Executor ‘s removal for threatening and damaging their asset !! "If it is found liable for the taxes, the Jackson estate could pay them off by selling assets or asking the IRS if it could pay over 15 years, Katzenstein said. http://touch.latimes.com/#section/-1/article/p2p-79217313/

5 months 1 week ago
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Marco Balletta's picture

Marco Balletta

#MJFam THIS is MJ’s likeability at the time of his death , which was NOT worth 2 thousands Pepsi Soda cans , but MJ ‘s likeability was the one of an Artist that SOLD OUT 50 Shows IN HOURS !! http://www.billboard.com/articles/news/269209/michael-jacksons-50-shows-sell-out-in-hours http://www.theguardian.com/music/2009/mar/13/michael-jackson-o2-arena-residency-sells-out http://www.today.com/id/29676050/ns/today-today_entertainment/t/michael-jacksons-london-concerts-sell-out/#.UkbpiD8QM1I http://www.cnn.com/2009/SHOWBIZ/Music/03/13/michael.jackson.concerts.tickets/ http://www.people.com/people/article/0„20265752,00.html http://www.telegraph.co.uk/news/celebritynews/4973415/Tickets-for-Michael-Jacksons-London-02-Arena-dates-sold-out.html http://www.mtv.com/news/articles/1606985/michael-jackson-sells-out-50-london-concerts.jhtml Though this IRS VS Estate case could be about Valuation, because the law is about Estate taxation based on market value, hence the question in the case would be value of MJ’s likeness and image….. , to me, this is just looking at half of the problem, because the Estate got tax breaks using MJ’s liabilities too and they paid also less taxes under-evaluating MJ’s possessions(ie. catalogs). I believe IRS should add more questions in the case. How about IRS doing a Federal Investigation to look into a possibility of a forced bankruptcy that brought in the end MJ into liabilities and MJ Estate into tax cuts. The forced bankruptcy may have had involved also under-evaluation of MJ’s assets ,along the years , until today,that brought also to pay less taxes to IRS. IRS should look into this : http://www.contactmusic.com/news/jackson-discovers-conspiracy-against-him_1004647 … I bet MJ reported the case to the authorities at that time …. For IRS, if liability are higher , they (IRS) get less $$ from the estate because the estate pay less taxes. If the valuation of MJ’s properties are lower, the estate pay less taxes to IRS . It is in the interest of the IRS get to know , the real value of MJ’s properties and the real amount of MJ’s liabilities …. Will they do it ? Is their job to do it ? I am not sure , but if I were the government and I wished more $ from estates , I would look into the real value of Estate’s assets and the origin and real values of debts. If many artists were pushed to be broke , and their estates (same lawyers , business men and entities that were around them while alive) were behind that for getting tax cuts , while stealing for years money from artists , that would worth for IRS investigate because it would mean more $ for them (IRS)…. stupid IRS if they do not investigate and stupid me , USA tax payer , to not push IRS to do such, because Artist’s Estates are making me paying the taxes that they do NOT pay…. (I said “me paying”, because ppl that pay taxes, end up paying more taxes to cover the $ that governments do not get from fraudulent tax payers) True that IRS would get more $ , and true that beneficiaries would pay more $ to IRS, but that also means that their loved one (artist) was ripped off for years , pushed to be broke and into debts and loans , earning nothing from their art because estates , lawyers , “business men” and banks were and are still living off their art …. And now they are living off their beneficiaries …. A higher valuation of assets , means also higher revenues for the artist .. Where the higher revenues have gone ? Where the tax cuts have gone? Not in MJ’s pocket for sure …In some bank and lawyer and “business men” ‘s pocket … For sure… ps: let’s NOT forget that Executors ARE LIABLE for their wrongdoings while running the Estate and beneficiaries can make Executors accountable and responsible to pay IRS for the damage created to the Estate, and demand removal of the executors…… Beat it, #MichaelJacksonEstate ! You Want It, You Earn It , With Dignity http://www.youtube.com/watch?v=pkXFDUs6FiY&feature=youtu.be

5 months 1 week ago
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rosemary moly gomes's picture

rosemary moly gomes

What are estate doing? Shut them off open up.

5 months 2 weeks ago
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