Prince Jackson, Paris Jackson and Bigi Jackson Alan Chapman/Dave Benett/Getty Images
Michael Jackson’s beneficiaries will not receive funds from his trust until a legal dispute is settled between his estate and the IRS, according to a court filing obtained by People.
The dispute began when the IRS audited the estate’s federal estate tax return and claimed that the estate “undervalued its assets” and owed an additional $700 million in taxes and penalties. The estate disputed the IRS’ claim and won in court in 2021. However, the estate also filed a motion for reconsideration of the court’s value of Jackson’s music catalog. That case is still pending.
Until that case is decided, the value of Jackson’s estate cannot be determined and the IRS and estate cannot agree on the value of deduction in the federal estate tax return.
Jackson’s three kids, Prince, 27, Paris, 25, and Bigi, 22, are listed as beneficiaries to the late King of Pop’s trust, while his mother, Katherine, 94, is the sole beneficiary of a subtrust. Jackson’s trust calls for 20% of his estate ‘as valued for federal estate tax purposes’ to be given to charity and the remaining assets distributed to subtrusts. As the legal battle continues, the estate is providing for Jackson’s kids and mother through “the family allowance.”
Michael Jackson’s long-awaited biopic is coming to theaters faster than you can say “Beat It.” The upcoming film, Michael, has made headlines since casting Jaafar Jackson, the real-life nephew of the late musician and son of Jermaine Jackson, as Michael. Director Antoine Fuqua announced the exciting casting decision via Instagram in January 2023, along with […]
Through all of this, Katherine and Bigi remain at odds over Katherine’s effort to use funds from the estate to cover the legal fees she incurred in a separate ongoing dispute over Jackson’s music catalog and its sale to Sony.
Bigi Jackson and Katherine Jackson Getty Images (2)
Katherine is arguing that the executors of the estate are not awarding enough to its beneficiaries and that they can afford to cover her legal costs.
“It seems clear to [Katherine] that the Executors are holding all of the assets in the Estate in order to keep control over them, and to avoid the more liberal distribution requirements of the Trust,” her court filing reads, according to People.
The filing also disputes the executors’ belief that 20% of the estate must be donated to charity before additional assets are distributed — one of the factors holding up distributions to Katherine and her grandchildren in the first place.
Michael Jackson left more than an extensive musical legacy and his former estate of Neverland Ranch behind when he died at the age of the 50 on June 25, 2009 — the “Billie Jean” singer also had three children. Michael’s first child, Michael Joseph Jackson Jr., was born to the musician and nurse Debbie Rowe, […]
“Nothing in the Trust requires those payments to be made before any preliminary distribution to other beneficiaries,” it reads.
Regardless, Bigi is requesting the court deny the request.
“It is readily apparent that a reversal on appeal would be an extreme longshot,” Bigi’s lawyers wrote on his behalf. “Given those odds, Bigi decided not to waste his resources to participate in an appeal. Nonetheless, Katherine has decided to appeal this court’s ruling. That decision is not for the benefit of the heirs.”
