Brooke Astor’s Estate Files 7 Lawsuits in U.S. Tax Court

The estate of Brooke Astor recently filed seven lawsuits in U.S. Tax Court challenging the IRS’s demand of $62 million. The IRS claims that the estate is worth $223 million and has a total federal tax bill of $97 million. Executors of the estate claim that the estate is only worth $93 million and has a tax bill of only $31 million. Part of the discrepancy in the two valuations is due to charitable bequests (around $96 million) the estate claimed as deductions but which the IRS determined were ineligible to reduce the estate’s taxes.

The IRS also claims that Astor gave away $20 million in gifts during her lifetime and that this amount should have been included in the estate. The estate does not dispute the fact that federal gift-tax returns were not filed for the $20 million in gifts, so the IRS’s $62 million demand includes $2 million in penalties.

Of the seven lawsuits filed by Astor’s estate, six deal with gift and tax issues pertaining to years when Astor did not file returns.

See William P. Barrett, Brooke Astor Estate Now Faces $62 Million Attack by IRS, Forbes, Dec. 7, 2011.

Special thanks to Janet Novack (Washington Bureau Chief, Forbes Media) and Jim Hillhouse (WealthCounsel) for bringing this article to my attention.