Late singer, Michael Jackson, dubbed the King of Pop is still fighting and winning battles many years after his passing.
A U.S. Tax Court Judge, Mark Holmes, has ruled in favour of the Jackson Estate vs the government in an image and likeness tax battle.
The late singer’s estate won the case over the Internal Revenue Service (IRS) on various key issues in a closely monitored court case.
The Tax Court Judge found Michael Jackson’s image and likeness to be worth $4 million as at when he died back in 2009 aged 50 and not the $161 million the government had claimed.
According to Michael Jackson’s representative, a lot of damage was done to his image in his final years before his passing and at some point, he only made $24 in image rights and likeness-related revenue.
This was due to the late singer struggling to repair the damage done to his image amid allegations of child molestation.
Judge Holmes noted that the vital constraint was to be able to separate what the value was at the time of the late king of pop passing from what the futuristic value would be because of the estate’s management of those assets.
Due to the fact that the future is an unknown constraint, the estate’s experts made a comparison between Jackson’s posthumous prospects and that of other departed celebrities.
The prospects of Princess Diana, Elvis Presley, Marilyn Monroe, James Dean, Bettie Page, and Jackie Robinson were those employed in making the comparison.
The IRS also leveraged on “Unforeseeable Opportunities” in their defense in a bid to salvage a comeback on brand merchandise as well as themed attractions but Jackson’s representatives were able to counter using Presley as a template once again as well as other departed celebs.
Also, Judge Holmes found the government’s hypotheticals to hold no water and termed it “unreliable and unpersuasive” as costs for managing the likeness rights seem to have been ignored due to the hit Jackson’s reputation had taken.
At the end of the day, Judge Holmes ruled that Jackson’s likeness was worth an approximated $4.15 million at the time of his demise.
He also went further to rule that his interest in New Horizon Trust II (which included the Sony/ATV stake) had no accountable value due to the fact that the liabilities exceeded its assets by about $89 million at the time Jackson passed, and his interest in New Horizon Trust III (which included Mijac) was valued not more than $107 million.
Micheal Jackson’s estate was represented by a team of California tax lawyers who put out a statement after the case saying the ruling by the tax court was an unambiguous victory for Jackson’s children who without the victory would have been saddled with an oppressive tax liability of more than $700 million.
The income and assets from the estate go into a trust which the main beneficiary is Mr. Jackson’s mother, Katherine. The assets also go to Mr. Jackson’s three children as well as to charity.
MJ lives on
Victory even in death. Rest on King of Pop.
That’s great