Prince’s estate & IRS battle over $80M

MINNEAPOLIS — The ongoing controversy over the money left behind by Prince (above) when he died without a will is heating up again after Internal Revenue Service calculations showed that executors of the rock star’s estate undervalued it by 50 percent, or about $80 million.

The IRS determined that Prince’s estate is worth $163.2 million, far more than the $82.3 million valuation submitted by Comerica Bank & Trust, the estate’s administrator. The discrepancy primarily involves Prince’s music publishing and recording interests, according to court documents.

The IRS alleges that Prince’s estate owes another $32.4 million in federal taxes, roughly doubling the tax bill based on Comerica’s valuation, the Star Tribune reported.

The IRS also has ordered a $6.4 million “accuracy-related penalty” on the estate, citing a “substantial” undervaluation of assets.

Prince’s death of a fentanyl overdose on April 21, 2016, created one of the largest and most complicated probate cases in Minnesota history. Estimates of his net worth have varied widely, from $100 million to $300 million.

With the probate case dragging on, Prince’s six sibling heirs have grown increasingly unhappy, particularly as the estate has doled out tens of millions of dollars to lawyers and consultants.

Comerica and its lawyers at Fredrikson & Byron in Minneapolis maintain their estate valuations are solid. Comerica sued the IRS this summer in US Tax Court in Washington, DC, saying the agency’s calculations are riddled with errors.