Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
IRS Goes After Michael Jackson's Estate for $702 Million Tax Bill
Author: Scarinci Hollenbeck, LLC
Date: September 20, 2013
Key Contacts
Back
The estate of the late pop icon Michael Jackson is embroiled in a bitter battle with the IRS over a tax bill, interest, and penalties that involve a range of his assets. The agency issued an official Notice of Deficiency to the estate in May.
The $702 million tax bill revolves around Jackson’s Neverland Ranch, his image and likeness, and several recording properties. Although the estate is challenging the tax agency’s assertion, it has yet to reveal any specific amounts for which it may be liable, Reuters reports. Jackson’s attorneys did pay estate taxes when the pop star passed, the value of the estate is in question, which may be lead to a lengthy dispute in the U.S. Tax Court. This is largely because some of the assets in question – such as Jackson’s image and likeness – may be challenging to quantify.
This has been evidenced by the year-long struggle between attorney’s for the estate and the IRS to reach a resolution.
“The government believes estates of celebrities likely have a significant audit potential,” a representative of Jackson’s estate told Reuters. “The estate believes the estate tax return properly reflected the interests of Mr. Jackson as of the date of his death.”
Forbes noted that federal estate tax return for Jackson’s estate reported a taxable estate of approximately $9 million. However, many tax analysts estimate the total worth of the estate to be around $400 million, leaving a large gap in what was paid and what still may be owed, especially once interest and penalties are assessed. Under existing tax law, the penalties for Jackson’s estate could be as high as 40 percent of the difference between the taxes paid and those allegedly owed for some of the assets in question.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Author: Jesse M. Dimitro
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
Author: Jesse M. Dimitro
Fred D. Zemel Appointed Chair of Strategic Planning at Scarinci & Hollenbeck, LLC
Business Transactional Attorney Zemel to Spearhead Strategic Initiatives for Continued Growth and Innovation Little Falls, NJ – February 21, 2025 – Scarinci & Hollenbeck, LLC is pleased to announce that Partner Fred D. Zemel has been named Chair of the firm’s Strategic Planning Committee. In this role, Mr. Zemel will lead the committee in identifying, […]
Author: Scarinci Hollenbeck, LLC
Novation Agreement Process: Step-by-Step Guide for Businesses
Big changes sometimes occur during the life cycle of a contract. Cancelling a contract outright can be bad for your reputation and your bottom line. Businesses need to know how to best address a change in circumstances, while also protecting their legal rights. One option is to transfer the “benefits and the burdens” of a […]
Author: Dan Brecher
What Is a Trade Secret? Key Elements and Legal Protections Explained
What is a trade secret and why you you protect them? Technology has made trade secret theft even easier and more prevalent. In fact, businesses lose billions of dollars every year due to trade secret theft committed by employees, competitors, and even foreign governments. But what is a trade secret? And how do you protect […]
Author: Ronald S. Bienstock
What Is Title Insurance? Safeguarding Against Title Defects
If you are considering the purchase of a property, you may wonder — what is title insurance, do I need it, and why do I need it? Even seasoned property owners may question if the added expense and extra paperwork is really necessary, especially considering that people and entities insured by title insurance make fewer […]
Author: Patrick T. Conlon
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
IRS Goes After Michael Jackson's Estate for $702 Million Tax Bill
Author: Scarinci Hollenbeck, LLC
The estate of the late pop icon Michael Jackson is embroiled in a bitter battle with the IRS over a tax bill, interest, and penalties that involve a range of his assets. The agency issued an official Notice of Deficiency to the estate in May.
The $702 million tax bill revolves around Jackson’s Neverland Ranch, his image and likeness, and several recording properties. Although the estate is challenging the tax agency’s assertion, it has yet to reveal any specific amounts for which it may be liable, Reuters reports. Jackson’s attorneys did pay estate taxes when the pop star passed, the value of the estate is in question, which may be lead to a lengthy dispute in the U.S. Tax Court. This is largely because some of the assets in question – such as Jackson’s image and likeness – may be challenging to quantify.
This has been evidenced by the year-long struggle between attorney’s for the estate and the IRS to reach a resolution.
“The government believes estates of celebrities likely have a significant audit potential,” a representative of Jackson’s estate told Reuters. “The estate believes the estate tax return properly reflected the interests of Mr. Jackson as of the date of his death.”
Forbes noted that federal estate tax return for Jackson’s estate reported a taxable estate of approximately $9 million. However, many tax analysts estimate the total worth of the estate to be around $400 million, leaving a large gap in what was paid and what still may be owed, especially once interest and penalties are assessed. Under existing tax law, the penalties for Jackson’s estate could be as high as 40 percent of the difference between the taxes paid and those allegedly owed for some of the assets in question.