Michael Jackson’s family, his children Prince, Paris, and Bigi, along with his mother, Katherine, are cut off from his trust fund until the late Jackson’s estate and IRS settle their dispute.
The New York Post’s Page Six reports that the Jackson children, all of whom are beneficiaries of his trust, and his mother, the sole beneficiary of a sub-trust in his will, owe about $700 million in taxes and penalties for undervaluing assets.
Jackson’s Family Money On Hold
The dispute began after an IRS audit of the estate’s federal tax return. Initially, the estate contested the findings and won a court case related to this matter in 2021. However, the ultimate value of the estate, which includes Jackson’s music catalog, has not yet been determined. This delay is holding up final tax assessments and the distribution of assets from the trust to his beneficiaries, The Daily Mail reported.
While the value of MJ’s music catalog has not been fully determined, in 2016 Sony announced that it had completely acquired Jackson’s 50 percent of Sony/ATV for $750 million.
The Daily Mail reported that Sony acquired half of Michael Jackson’s interests in his music catalog and other assets for $800 million to $900 million, including the following: The King of Pop’s publishing rights, recorded music revenues, the Broadway show “MJ: The Musical,” an upcoming biopic titled “Michael,” and other projects using Jackson’s voice, image, and likeness.
Katherine, 94, was receiving a $1 million annual allowance from the estate. In 2019, Jackson’s estate provided his daughter, Paris, 26, with $723,000 to build a home. The specific amounts given to his other children, Prince, 27, and Bigi Jackson, 22, for that year were not detailed in the provided report. However, it was noted that the estate provides substantial financial support to Michael’s children through allowances, as outlined in the annual reports to the probate court.
In addition to the IRS dispute, there are internal family tensions between Katherine and her grandson Bigi (Blanket).
Katherine has sought to use trust funds to cover her legal fees in a separate dispute over the sale of MJ’s music catalog to Sony.
Bigi opposes Katherine’s move, saying using the trust funds to pay legal fees does not benefit the heirs.
Katherine has been actively opposing this deal, arguing that it does not benefit the heirs and seeking to block it, but a Los Angeles Superior Court judge recently ruled in favor of the estate’s executors, John Branca and John McClain, allowing the deal to proceed.
Katherine has since filed an appeal against this decision.
The trust stipulates that 20 percent of the estate’s value must be allocated to charity before distributions to beneficiaries, another factor delaying payments, US Magazine reported.
