Celebrity, Death, and Taxes: Michael Jackson's Estate

8 Pages Posted: 19 Oct 2009 Last revised: 30 Mar 2011

Bridget J. Crawford

Pace University School of Law

Joshua C. Tate

Southern Methodist University - Dedman School of Law

Mitchell Gans

Hofstra University - School of Law

Jonathan G. Blattmachr

Milbank, Tweed, Hadley & McCloy LLP

Date Written: October 19, 2009

Abstract

The untimely death of Michael Jackson this past June presents an opportunity to reassess certain thorny estate tax issues that may arise when a celebrity dies owning valuable intellectual property. Elsewhere we have debated hypothetical, tax-motivated changes to state laws relating to postmortem publicity rights. This article focuses on existing legislation, like California’s, that makes publicity rights both devisable and descendible. Federal transfer taxes are levied on intangible property as well as tangible assets, and therefore apply to intellectual property, including a celebrity’s right of publicity and copyrights retained by an artist in his or her creations. Using Michael Jackson’s estate as an example, and focusing primarily on publicity rights, we examine two questions that any estate planner representing a celebrity client ought to consider. First, how should a personal representative value intellectual property for estate tax purposes? Second, what strategies are available to lessen the estate tax burden associated with certain intellectual property rights?

Keywords: estate tax, intellectual property, publicity rights, estate planning, valuation, celebrity, celebrities, Michael Jackson

JEL Classification: K34, K39

Suggested Citation

Crawford, Bridget J. and Tate, Joshua C. and Gans, Mitchell and Blattmachr, Jonathan G., Celebrity, Death, and Taxes: Michael Jackson's Estate (October 19, 2009). Tax Notes, Vol. 125, No. 3, 2009; SMU Dedman School of Law Legal Studies Research Paper No. 48; Hofstra Univ. Legal Studies Research Paper No. 10-04. Available at SSRN: https://ssrn.com/abstract=1488428

Bridget J. Crawford (Contact Author)

Pace University School of Law ( email )

78 North Broadway
White Plains, NY 10603
United States

Joshua C. Tate

Southern Methodist University - Dedman School of Law ( email )

P.O. Box 750116
Dallas, TX 75275
United States
(214) 768-2791 (Phone)

Mitchell M. Gans

Hofstra University - School of Law ( email )

121 Hofstra University
Hempstead, NY 11549
United States
(516) 463-5876 (Phone)

Jonathan G. Blattmachr

Milbank, Tweed, Hadley & McCloy LLP ( email )

1 Chase Manhattan Plaza
New York, NY 10005
United States
212-530-5066 (Phone)

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