Michael Jackson's children blocked from late singer's trust over '$700m tax bill'
Michael Jackson’s three children and his mother have been blocked from receiving funds from the late singer’s trust until a hefty tax bill has been settled.
The Beat It hit-make died aged 50 in 2009 with Prince, 27, Paris, 26, and 22-year-old Bigi (previously known as Blanket), named beneficiaries of his trust, while his mother Katherine, 94, is a sole beneficiary of a sub trust in his will.
According to documents obtained by People and filed on May 28 however, none of Jackson’s surviving relatives will receive a penny until a dispute between his estate and the IRS has been resolved.
The dispute began following an IRS audit of the estate's federal tax return. The estate was then “issued a note of deficiency” alleging it “undervalued its assets” and owed “$700 million in taxes and penalties.”
The estate disputed those findings and won a trial in tax court in 2021. However, they have since filed a motion for reconsideration in regards to the court's value of Jackson's music catalog, known as Mijac (owned by Sony music), which is still pending.
Legal representatives for the children and Mrs Jackson previously asked that some funds be distributed to the family trust while the dispute is ongoing but the request was denied.
It was claimed that the "family allowance" could provide for them instead.
The value of the estate has therefore not been finalised for tax purposes and the estate and IRS cannot agree on the value of the deduction until then.
This latest development comes amidst Bigi's own legal battle with his grandmother.
In March, he filed to stop his grandparent from spending his dad's estate funds amid their legal battle.
In documents obtained by TMZ, Bigi tried to block Mrs Jackson from using money from Jackson’s estate to fund an appeal on a previous ruling in the increasingly complex fight.
Up until now, Bigi and Mrs Jackson were believed to have been on the same page as they attempted to stop the executors of Jackson’s estate from making a costly transaction.
While it has not been confirmed what exactly they were opposing, it is believed to be around the sale of Jackson’s music catalogue to Sony for $600m.
