Entertainment

Jackson's children and mother are blocked from trust funds due to an ongoing tax dispute

The ongoing tax dispute with the IRS has temporarily restricted any financial distributions to Prince, Paris, Bigi, and Katherine Jackson.

Jackson's children and mother are blocked from trust funds due to an ongoing tax dispute.

According to court documents, Prince, Paris, and Bigi Jackson, aged 27, 26, and 22 respectively, are beneficiaries of their late father's trust. 

Katherine Jackson, Michael's mother, is the sole beneficiary of a sub-trust in his will.

The issue arose following an audit of the estate's federal tax return by the IRS. 

The agency claimed that the estate undervalued its assets and owed a staggering $700 million in taxes and penalties. 

Although the estate initially contested these findings and won a trial in tax court in 2021, there is an ongoing motion for reconsideration regarding the valuation of Jackson's music catalog, known as Mijac, which is still pending.

As a result of this unresolved tax dispute, Michael Jackson's children and mother have been temporarily blocked from receiving any financial distributions from the trust.

The court has denied the request to distribute a portion of the estate to the family trust, as the executors argue that the amount that could be safely distributed cannot be determined at this time.

However, the executors have suggested that the estate can provide for Michael's children and mother through the "family allowance" provision.

Remarkably, the exact value of Michael Jackson's estate hasn't been decided for tax reasons yet. 

They are still in the process of determining its worth. Once the value is determined, the estate and the IRS must agree on the deduction value before making a final decision.

Apart from the tax disagreement, there have been conflicts between the youngest child, Bigi, and his grandmother, Katherine.

Blanket Jackson, the son of the late Michael Jackson, is currently engaged in a legal battle with his grandmother, Katherine Jackson, over the funds from his father's estate.

The disagreement revolves around a hidden deal using the estate's funds that Blanket wants to prevent. His main focus is to protect his father's memory and make sure the money is handled responsibly.

The result of this legal dispute will have a big impact on how Michael Jackson's riches are divided.

Reports suggest that the transaction at the center of the conflict entails selling almost half of Michael's music collection for an astounding $600 million. 

However, the exact details of the agreement and the reasons behind Blanket and Katherine's objections have not been revealed in the court records.

One remarkable aspect of this disagreement is that Katherine allegedly utilized some of Michael Jackson's money to pay for her legal expenses.

Regrettably, their combined attempts to contest the transaction did not succeed, as the court sided with the executors of the estate, permitting them to carry out the transaction and utilize the funds belonging to the late superstar. 

Despite this setback, Katherine plans to appeal the decision, while Blanket believes that her appeal will not be fruitful.

Being the youngest son and inheritor of his father's wealth, Blanket is committed to ensuring that Michael's estate is not responsible for Katherine's legal fees.

Born in 2002 through a surrogate, he has generally stayed out of the public eye since his father's death in 2009. 

However, he recently made a rare appearance in Los Angeles, which drew attention due to the ongoing legal conflict.