MINNEAPOLIS (AP) – The ongoing controversy over the money left behind by Prince when he died without a will is heating up again after IRS calculations showed that executors of the rock star’s estate underestimated him by 50%, or about $ 80 million.
The IRS determined that Prince’s estate is worth $ 163.2 million, overshadowing the $ 82.3 million valuation presented by Comerica Bank & Trust, the estate administrator. The discrepancy mainly involves Prince’s publishing and recording interests, according to court documents.
Documents show that the IRS believes Prince’s estate owes another $ 32.4 million in federal taxes, almost double the tax bill based on Comerica’s assessment, the Star Tribune reported.
The IRS also ordered a $ 6.4 million “precision-related penalty” on Prince’s estate, citing a “substantial” undervaluation of assets, the documents show.
Prince’s death from fentanyl overdose on April 21, 2016, created one of the largest and most complicated probate lawsuits in Minnesota history. Estimates of your net worth vary widely, from $ 100 million to $ 300 million.
With Prince’s inventory process dragging on, his six heir brothers are increasingly unhappy, especially since the estate has distributed tens of millions of dollars to lawyers and consultants.
Comerica and her lawyers at Fredrikson & Byron in Minneapolis say their real estate appraisals are sound. Comerica sued the IRS this summer at the United States Tax Court in Washington, DC, saying the agency’s calculations are full of errors.
“What we have here is a classic battle of experts – estate experts and those from the IRS,” said Dennis Patrick, a estate planning attorney at DeWitt LLP in Minneapolis who is not involved in the case. Valuing a large property, added Patrick, “is much more of an art than a science.”
Comerica, a Dallas-based financial services giant, asked the tax court to hold a trial in St. Paul. A trial can dramatically lengthen the Prince’s property settlement and generate more legal fees at the expense of the prince’s heirs, said Patrick.