The Michael Jackson Estate is under scrutiny of the U.S. Internal Revenue Service (IRS) for possible tax fraud. The late king of Pop's executors are accused of undervaluing assets after the legendary singer's death in 2009, according to several reports.
The tax agency accuses the Estate of misleading them about Jackson's net worth, his interest in certain trusts and value of recordings.The IRS has urged the estate to cough up about $505 million in taxes and $107 million in penalties after raising the rate from 20 percent to 40 percent, reports the Los Angeles Times.
Here is a list of the major incongruities IRS found in the Estate:
|
Items |
MJ's Estate Evaluations |
IRS Evaluations |
|
Net Worth |
$7 Million |
$1.125 Billion |
|
Likeness (merchandize etc.) |
$2105 |
$434 Million |
|
Interest in Trust (A)* |
0 |
$469 Million |
|
Interest in Trust (B)+ |
$2.2 Million |
$60.6 Million |
|
Jackson 5 Master Recordings |
$11.2 Million |
$45.5 Million |
*Trust (A) - An unnamed trust that owns songs of Michael Jackson and the Beatles; +Trust (B) - Another unnamed trust owned by MJ.
While the IRS has slapped a huge fine on the MJ estate, representatives say that they have always complied with tax laws and have evaded nothing.
"Estate of Michael Jackson disputes the IRS position in its entirety," a representative of the Estate told TMZ.
"The Estate used independent, nationally-recognized and highly-qualified expert appraisers in determining the value of the Estate's assets. By contrast, the IRS consultant's values are not based on standard appraisal methodology, but rather are speculative and erroneous assumptions unsupported by the facts or law. The Estate has paid over $100 Million dollars in taxes and is in full compliance with the tax laws," the rep added.
According to Billboard's estimates, MJ's asset value after death has gone up considerably.
This is not the first time MJ's estate is getting into legal trouble. In October 2013, music producer Quincy Jones sued the estate over royalty payment issues.
Jackson passed away due to a cardiac arrest,overdosing on a drug, propofol. He breathed his last at his Holmby Hills home in L.A, California.
Jackson's primary home was the Neverland ranch, which by the time of his death, he had little stake in. Jackson's debt had driven him to sell stakes of his elaborate ranch. Singer Lady Gaga had expressed interest in purchasing the property and restoring it to its previous charm and glory.
