UPDATE: Court Rules Against Katherine/ MJ Estate Prevails

[CherubimII]

Michael Jackson's Kids and Mom Get No Distributions from Trust Until Estate and IRS Settle Dispute,​

Lawsuit Reveals​

By Daniela Avila
Updated on May 31, 2024 01:30AM EDT
https://people.com/michael-jackson-...til-estate-irs-settle-dispute-lawsuit-8656207
By Daniela Avila

Updated on May 31, 2024 01:30AM EDT

Michael Jackson. PHOTO:
CARLO ALLEGRI/GETTY

Michael Jackson's beneficiaries, including his mom Katherine and three kids Paris, Prince and Bigi, will not receive financial distributions from his trust until an ongoing dispute between his estate and the IRS is resolved.

In a May 28 filing obtained by PEOPLE regarding the King of Pop's ongoing estate case, the executors under his will decided that so long as the legal disputes continue, his beneficiaries will not receive distributions.

The ongoing legal dispute began when the IRS audited the estate's federal estate tax return and "issued a note of deficiency" claiming that the estate "undervalued its assets" and owed "an additional $700 million in taxes and penalties," the filing states.

In 2021, the estate disputed those assessments and won in 2021 after a trial in tax court. Since then, however, the estate filed a motion for reconsideration regarding the court's value of Mijac (his music catalog owned by Sony music) that remains pending.

Prince, Paris and Bigi Jackson.
ALAN CHAPMAN/DAVE BENETT/GETTY
Katherine Jackson Responds to Grandson Bigi's Objection to the Jackson Estate Paying Her Legal Fees amid Ongoing Battle


Therefore, the value of the estate for tax purposes has not been determined. Once it is, the IRS and the estate need to agree to the value of deduction before a final judgement can be entered.

While that process is underway, attorneys requested that a portion of the estate "remain subject to administration" while the remaining legal issues are resolved to distribute to the Michael Jackson family trust.

John Branca and John McClain, the executors under the will of the pop star, rejected the request because they cannot "possibly determine what amount could be safely distributed at this time," per the filing.

In addition, the trust "requires that 20 percent of the estate 'as valued for federal estate tax purposes' be distributed to charity before the remaining assets of the estate can be distributed to sub-trusts." A resolution of the dispute is "necessary" to determine the charitable contribution.

Until then, the executors suggest that the estate provide for the kids and his mother through "the family allowance."

The new filing comes two months after Katherine responded to her grandson Bigi's objection to her using funds from Michael's estate to pay her legal fees in an ongoing dispute with the executors over the singer's catalog sale to Sony.

Katherine and Michael Jackson.
JUSTIN SULLIVAN/GETTY
Inside the Fight over Michael Jackson's $2 Billion Estate — and His Mom's Battle with Her Grandson Bigi


In the filing, Katherine alleged that the executors are being too frugal with how the estate money is being awarded to its beneficiaries and argued that they can afford to cover the costs she's requesting.

The filing stated, "... 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."

The filing also made an argument against 20 percent of the estate being donated to charities: "...Nothing in the Trust requires those payments to be made before any preliminary distribution to other beneficiaries."

Katherine herself is not a beneficiary of the estate like the singer's children, but is instead a sole beneficiary of a sub trust in Michael's will.

https://www.dailymail.co.uk/tvshowb...Jacksons-kids-mother-blocked-trust-money.html

https://www.theroot.com/michael-jacksons-family-cant-get-his-money-15-years-aft-1851511666

https://www.rollingstone.com/music/music-news/michael-jackson-heirs-estate-irs-dispute-1235030682/

https://pagesix.com/2024/05/30/ente...trust-money-until-estate-settles-irs-dispute/

https://www.etonline.com/michael-ja...-money-from-trust-until-estate-and-irs-settle

https://www.theroot.com/michael-jacksons-family-cant-get-his-money-15-years-aft-1851511666

 

[Annita]

@admins @Hiker @Beano Wild can merge it in this thread

Estate wins IRS case

https://www.wsj.com/articles/michael-jackson-estate-to-face-smaller-tax-bill-after-court-ruling-11620070959?redirect=amp#click=https://t.co/Iiy8nWhd1f

www.mjjcommunity.com

 

[CherubimII]

Corrected: Michael Jackson's Kids and Mom's Trusts 'Cannot Be Funded' Until Estate and IRS Settle Dispute​

https://www.msn.com/en-us/music/cel...-dispute-filing/ar-BB1nlT59?ocid=BingNewsSerp
Story by Daniela Avila, Danielle Bacher

Meanwhile, "the Estate provides Michael's mother and children with very substantial amounts of money to support them," the late singer's estate said in a statement
[EDITOR'S NOTE: This story has been corrected and updated with comment from the Jackson estate's executors.]

The trusts of Michael Jackson's mom Katherine and three kids Paris, Prince and Bigi cannot be funded until an ongoing dispute between his estate and the IRS is resolved, the estate's executors say in a new legal filing.

In a May 28 filing obtained by PEOPLE regarding the King of Pop's ongoing estate case, the executors under his will state that so long as the legal disputes continue, the trusts of his beneficiaries cannot be funded. However, the distributions do not affect the money they are allocated.

All three children are beneficiaries of the estate and receive a substantial amount of money. Katherine is a life beneficiary of a portion of the trust, and a source close to the estate says that she has received more than $55 million since the singer's death. "Virtually no request of Mrs. Jackson for her care or maintenance has been declined," the estate contends in recent filings, obtained by PEOPLE.

In a statement to PEOPLE, the "Thriller" singer's estate said that his family members still receive payments through an allowance.

"In annual reports provided to the probate court, which are publicly available, anyone can see that the Estate provides Michael’s mother and children with very substantial amounts of money to support them," the statement reads. "The Estate has a very cooperative relationship with Michael’s children and whenever they need anything, the Estate works with them to ensure that they are very well taken care of, just as Michael would have wanted."

The ongoing legal dispute began when the IRS audited the estate's federal estate tax return and "issued a note of deficiency" claiming that the estate "undervalued its assets" and owed "an additional $700 million in taxes and penalties," the filing states.

In 2021, the estate disputed those assessments and won in 2021 after a trial in tax court. Since then, however, the estate filed a motion for reconsideration regarding the court's value of Mijac (his music catalog owned by Sony music) that remains pending.

Therefore, the value of the estate for tax purposes has not been determined. Once it is, the IRS and the estate need to agree to the value of deduction before a final judgment can be entered.

While that process is underway, the California Franchise Tax Board requested that a portion of the estate "remain subject to administration" while the remaining legal issues are resolved to distribute to the Michael Jackson family trust.

John Branca and John McClain, the executors under the will of the pop star, rejected the request because they cannot "possibly determine what amount could be safely distributed at this time," per the filing.

In addition, the trust "requires that 20 percent of the estate 'as valued for federal estate tax purposes' be distributed to charity before the remaining assets of the estate can be distributed to sub-trusts," the executors say in their filing, adding that, "a resolution of the dispute is "necessary" to determine the charitable contribution.

Until then, the executors state that the estate continues to provide for the kids and his mother through "the family allowance."

The new filing comes two months after Katherine responded to her grandson Bigi's objection to her using funds from Michael's estate to pay her legal fees in a separate ongoing dispute with the executors over the singer's catalog sale to Sony.

In the filing, Katherine alleged that the executors are being too frugal with how the estate money is being awarded to its beneficiaries and argued that they can afford to cover the costs she's requesting.

The filing stated, "... 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."

The filing also made an argument against 20 percent of the estate being donated to charities: "...Nothing in the Trust requires those payments to be made before any preliminary distribution to other beneficiaries."

Katherine herself is not a beneficiary of the estate like the singer's children, but is instead a sole beneficiary of a sub trust in Michael's will.

 

[CherubimII]

Michael Jackson requested that his money be distributed among his three children: Prince, Paris, and Bigi and in addition, any charities of their choosing. He only provided maintenance money for his mother. So far Katherine Jackson has received 55 million dollars from the Michael Jackson Estate, which means, at this time, she has probably received more money than his children or any charities.

 

[joanna48]

Michael Jackson requested that his money be distributed among his three children: Prince, Paris, and Bigi and in addition, any charities of their choosing. He only provided maintenance money for his mother. So far Katherine Jackson has received 55 million dollars from the Michael Jackson Estate, which means, at this time, she has probably received more money than his children or any chariti

 

[joanna48]

I have long hoped that Michael's children would buy back Neverland Ranch. Maybe they have not had the funds due to this ongoing dispute. I still hope that they will purchase Neverland when the dispute is settled .

 

[CherubimII]

Michael Jackson Estate Wins Tentative Ruling to End $600 Million Catalog War with Katherine Jackson​

Nancy Dillon
Wed, July 17, 2024 at 3:33 PM CDT·
https://www.yahoo.com/news/michael-jackson-estate-wins-tentative-203312797.htm

An appellate panel in Los Angeles says Katherine Jackson should remember the time she first objected to the $600 million sale of her son’s catalog to Sony more than a year ago. Because she failed to argue then that the asset sale allegedly violated the terms of Michael Jackson’s will, she can’t do it now on appeal, the three-judge panel says.

In a new tentative opinion expected to be adopted over the next 90 days, the appellate panel sided with Michael Jackson’s estate executors and said Katherine Jackson “forfeited” the core claim of her appeal by not raising it in the lower court that first rubber-stamped the deal. The tentative ruling from California’s Second Appellate District went on to say that even if Katherine had raised that issue in the probate court, it wouldn’t have mattered. Looking at the merits of her appeal, the judges said they agree with the prior judge’s ruling that the executors had the full power and authority to negotiate the sale.

Katherine’s lawyer was set to give an oral argument for the appeal effort Wednesday, but waived the appearance after the tentative was issued. The tentative, obtained by Rolling Stone, ended with the warning that “this court will not entertain further briefing or grant a continuance.” (The lawyer did not respond to a request for comment.)

“Katherine did not contend [in the lower court] that the sale violated the terms of Michael’s will or were inconsistent with the Probate Code. Indeed, as the executors note, Katherine agreed in the probate court that the will gives the executors the power to sell, exchange, or otherwise dispose of the estate’s real or personal property,” the judges wrote. They pointed out that Katherine instead challenged the proposed transaction on the grounds that “the assets to be sold were valuable and would appreciate over time, the estate did not need the cash generated by the sale, the sale violated Michael’s wishes as communicated to various members of his family, and the executors took no steps to confirm that the sale price was at or above fair market value.”

But either way, the judges wrote, “We tentatively conclude that Katherine’s challenge fails on the merits because the probate court’s order does not violate the terms of Michael’s will.” They said that while Katherine argued under appeal that Michael’s will required the executors to “sell off as little of the estate as possible after paying legitimate estate debts,” the language of the will “does not suggest this limitation.” They said a “common-sense interpretation” of the will gives the executors authority to sell, invest or otherwise manage estate property until probate closes and the estate “as it exists then.” Once probate closes, the assets are to be distributed to the trust benefitting Michael’s three children, named as his full heirs, and Katherine, named as a lifetime beneficiary only.

The eye-watering $600 million catalog sale was first reported by Billboard and later confirmed by Rolling Stone. According to an appellate brief previously filed by the executors, the asset sale was negotiated to take advantage of an asset market that was “by far” the “hottest it had ever been.” The deal, which closed amid Katherine’s appeal, lets the estate maintain “effective control over Michael’s music” while diversifying its range of assets, the filing reads.

In her appellate filings leading up to the tentative ruling, Katherine and her lawyers called the deal “wholly improper.” They said she was seeking appellate relief so she could sue the estate for breach of fiduciary duty. (The lower court’s approval of the deal otherwise gives the executors immunity from lawsuits over its propriety.)

In a heavily redacted filing obtained by Rolling Stone, estate lawyer Jonathan P. Steinsapir called the deal a “remarkable” one that gives the estate “the best of both worlds” in terms of tax benefits and earnings. He said that under the deal, the estate retains the right to control “critical decisions” related to Michael’s name, image and likeness and exercise day-to-day control over his trademarks. “Over the past 14 years, the executors have exercised their powers with extraordinary care and extraordinary diligence with extraordinary results. As the probate court recognized in its [underlying decision], ‘What started out as nothing but debt and substantial ongoing obligations has been turned into a $2 billion estate,'” he wrote.

None of Michael’s three adult kids – Prince, Paris and Bigi Jackson – filed written objections to the estate petition for court approval of the transaction. Lawyers for Prince and Paris said at a March 2023 hearing that they did not object. A lawyer for Bigi reserved the youngest sibling’s right to object, court filings state. In March of this year, Bigi’s lawyer David Coleman wrote to the court this his client considered the asset sale of “paramount significance,” both financially and personally, but that he did not support Katherine’s appeal.

“Bigi objected to the proposed transaction. He believed that the executors should prove the necessity of the proposed transaction to the court,” the lawyer wrote. But once the court heard from Katherine and Bigi and still decided to approve the transaction, Bigi was persuaded that the deal couldn’t be stopped, he said. “The chances of a reversal on appeal were quite slim, and Bigi did not wish to incur further expense in pursuing an appeal,” the lawyer wrote.

Michael Jackson was 50 years old when he died of an accidental overdose of the surgery strength anesthetic propofol at his rented mansion in Los Angeles on June 25, 2009. His estate has been in probate ever since. A major roadblock to funding his heirs’ trust is a tax dispute with the IRS involving over $700 million in alleged unpaid taxes and penalties. According to estate filings, the final liability paid by the estate will be a “tiny fraction” of that amount thanks to legal maneuvering. The valuation of one remaining, unidentified asset is holding up final resolution of the tax issue, the estate has said, and in the meantime, the IRS continues to have a lien on estate assets.

Meanwhile, Michael Jackson’s companies are again defendants in revived lawsuits from two of his molestation accusers, Wade Robson and James Safechuck. The men claim the companies are liable for their alleged abuse as children.

 

[SmoothCriminal1995]

I don't know all the ins and outs, but on the face of it, this feels really disheartening. Selling his catalogue feels morally questionable in my mind