Aretha Franklin’s Estate Pays Off $7.8 Million In IRS Debt
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When Aretha Franklin died in August 2018, she did so without having a will in place for posthumous affairs. As a result, her heirs endured an onset of legal troubles including Franklin’s outstanding income taxes, and its associated penalties interest of $7.8 million.
Though the debt—gained between 2010 and 2017—didn’t put a massive dent in the estate’s estimated $80 million value, it has been paid in full, reports the Detroit Free Press. The debt was reportedly paid off on June 17 via a cashier’s check issued by Reginald Turner, attorney and personal representative for the estate. When asked to confirm on Monday (July 11), the IRS couldn’t, due to federal privacy laws.
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In April 2021, the estate and IRS made a deal to accelerate the payoff schedule which resulted in limited quarterly payments for Franklin’s sons, Clarence, Edward, Teddy, and Kecalf. The deal stated that an immediate $800,000 payment was required as only incoming revenue would be used to pay down the balance. 45% of quarterly income would go towards the existing balance while 40% would be “directed to an escrow account to handle future taxes on the newly generated income.” The remaining 15% would be used for managing the estate.
The estate did argue the incoming revenue should be equally distributed among the men, thus causing any tax obligations to be handled individually. The request has yet to be greenlit.
The outlet also reported that in addition to the looming tax issue, her heirs have been having quite the battle to sort the matters of her estate since her death—some of which were managed combatively.
This doesn’t help much considering multiple wills have been discovered since Franklin’s death. Three were found in the Queen of Soul’s home in 2019, all of which were handwritten and the fourth was an unsigned, typed document prepared by a Troy, Mich. law firm in 2017.
Each contains conflicting instructions on how to handle the estate and divide her assets among her heirs. The initial trial to sort the matter was scheduled for 2020 but has since been postponed due to the ongoing pandemic.
