Estate tax is charged on what a person’s property was worth on the day they died. The estate’s return valued Jackson’s image and likeness at $2,105, his half of Sony/ATV at zero because of the debts against it, and the trust holding his Mijac catalog at about $2.2 million. The IRS valued the same three assets at about $161 million, $206 million and $114 million, and claimed nearly $200 million in penalties. [1][2]
Judge Mark Holmes valued the image and likeness at about $4.15 million, the Sony/ATV stake at zero and the Mijac interest at about $107 million. He found the IRS’s only valuation expert unreliable and said he had been untruthful on the stand about his past work. He rejected all the penalties, finding the estate had relied on reputable appraisers in good faith. [1][2][3]
The opinion is useful well beyond tax. It is the most careful public summary of Jackson’s finances, and it explains why his name was worth so little in 2009: the allegations had badly damaged it. The court was explicit that it made no judgment about whether the allegations were true, only about their effect on value. [4]
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