IRS goes after Michael Jackson estate for $702 million

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NBC News – The Internal Revenue Service says that the Michael Jackson estate owes $702 million in federal taxes, plus penalties, according to charges the agency brought in U.S. Tax Court, reports Reuters.

IRS representatives say the estate has undervalued the late pop star’s assets by hundreds of millions of dollars, amounts they say were not disclosed in a court challenge the estate filed in July, as a response to a bill from the IRS.

Essentially, the estate is saying Jackson’s legacy is worth considerably less than the tax agency believes it is.

Jackson died on June 25, 2009, which is the date of the estate’s tax return, and left his estate to his mother Katherine, his three children and various charities. The filing the estate submitted indicated that his estate was valued at $7 million, for tax purposes. But in May the IRS said that was deficient by $505.1 million, plus penalties of $196.9 million. Tax Court documents indicating the amounts were released Tuesday, said Reuters.

Other disparities included Jackson’s likeness and image. The estate said that taxable value was $2,105 — while the IRS says it’s more like $434 million. The estate’s stake in Jackson’s recording assets was valued at $469 million by the IRS, but was not even included in the 2009 estate filing.

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