IRS: Administrator Undervalued Paisley Park By Nearly 50%

MINNEAPOLIS (AP) — The ongoing controversy over the cash left behind by Prince when he died with out a will is heating up once more after Internal Revenue Service calculations confirmed that executors of the rock star’s property undervalued it by 50%, or about $80 million. The IRS decided that Prince’s property is price $163.2 million, overshadowing the $82.3 million valuation submitted by Comerica Bank & Trust, the property’s administrator.

The discrepancy primarily entails Prince’s music publishing and recording pursuits, based on court docket paperwork. Documents present the IRS believes that Prince’s property owes one other $32.4 million in federal taxes, roughly doubling the tax invoice based mostly on Comerica’s valuation, the Star Tribune reported.

The IRS additionally has ordered a $6.4 million “accuracy-related penalty” on Prince’s property, citing a “substantial” undervaluation of property, paperwork present.

Prince’s dying of a fentanyl overdose on April 21, 2016, created one of many largest and most intricate probate court docket proceedings in Minnesota historical past. Estimates of his internet price have diversified broadly, from $100 million to $300 million.

With Prince’s probate case dragging on, his six sibling heirs have grown more and more sad, significantly because the property has doled out tens of thousands and thousands of {dollars} to attorneys and consultants.

Comerica and its attorneys at Fredrikson & Byron in Minneapolis preserve their property valuations are strong. Comerica sued the IRS this summer time in U.S. Tax Court in Washington, D.C., saying the company’s calculations are riddled with errors.

“What we have here is a classic battle of the experts – the estate’s experts and the IRS’ experts,” mentioned Dennis Patrick, an property planning lawyer at DeWitt LLP in Minneapolis who will not be concerned within the case. Valuing a big property, Patrick added, “is way more of an art than a science.”

Comerica, a Dallas-based monetary providers large, has requested the tax court docket to carry a trial in St. Paul. A trial may dramatically lengthen the settlement of Prince’s property and generate extra authorized charges on the expense of Prince’s heirs, Patrick mentioned.

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