Prince fans in Georgia may have heard that his sister has stated that her brother left no will. Settling his estate may raise a number of issues including one known as “right to publicity.” This is an issue that also arose with Michael Jackson’s estate. “Right of publicity” refers to the person’s image and name, and the IRS expects a valuation to be placed upon it and to be able to levy taxes on that value.
In Michael Jackson’s case, the valuation is still in dispute. His estate put the value of his right of publicity at $2,105. The IRS puts it at $434 million. One issue is whether the valuation is based on the worth at the time of Jackson’s death or since his death. His estate argues that at the time of his death, scandals had reduced the value of his image. This appears to be the first time the IRS has pursued an estate in this way.
There is also the possibility that a precedent will be set in Prince’s case regarding whether the right of publicity can be passed on to heirs. Further complexities may arise around the ownership of his music catalog.
Anyone who has intellectual property or a recognizable image may be affected by how this case plays out. Some observers have estimated Prince’s estate to be worth around $300 million. In the absence of a will leaving assets to charity, whoever is considered his heir under Minnesota intestacy law will have to bear the burden of a 40 percent federal estate tax on the amount in excess of the federal exemption, which in 2016 stands at $5.45 million.