WHAT DO PRINCE, MICHAEL JACKSON, AND WHITNEY HOUSTON HAVE IN COMMON? AND HOW IS ROBIN WILLIAMS DIFFERENT?
The obvious thing that Prince, the Gloved One, and Whitney Houston have in common is that they were all pop music megastars who died young. As a result of that commonality, they also left behind a huge tax problem for their successors, thanks to the IRS’ claim that the future value of a performing artist’s publicity rights is an asset that is taxable under the federal estate tax.
Valuing those future publicity rights is probably not an exact science. I wrote about the issue when it was raised following Prince’s passing. To get a better idea of what I mean, all you have to do is look at the difference between what the IRS claims Michael Jackson’s persona is worth, $434,000,000, and what his estate said it is worth, $2,105.
And how is Robin Williams different? He wasn’t a musician, but his persona is undoubtedly every bit as much a taxable asset as the others' in the eyes of the IRS. Yet that value apparently won’t result in a tax liability for his estate. Why? Because he left his publicity rights to charity.