Death Tax Grasps for More of William Davidson's Wealth
by Terri Eyden on
By Teresa Ambord
Anyone wealthy enough to own a major sports franchise is probably steeped deep in serious estate planning. William Davidson was no exception. In 2008, the year before he died, his net worth of $5.5 billion landed him a spot on Forbes magazine's richest people in the world, number sixty-two to be exact. He built Guardian Industries, based in Auburn Hills, Michigan, into a one of the premier makers of glass, automotive, and building products in the world. He owned the Detroit Pistons as well as the WNBA Detroit Shock, the NHL Tampa Bay Lightning, and others, and he was in the 2008 Basketball Hall of Fame.
Like most people in his wealth category, he was a strategic planner, with the help of his team of trusted advisers. He employed all the typical methods the very rich use to protect his estate, to pay the taxes due, and to preserve the bulk of his fortune. His heirs include his wife, Karen; Karen's daughter; Davidson's son and daughter from a previous marriage; and six grandchildren.
Then Came the Taxmen
More than four years after his death, you might think this issue was settled. But the IRS doesn't give up easily. When he died, Davidson's estate was estimated at $3 billion. After careful shepherding of his wealth, his estate attorneys say every dime of taxes owed was paid. Yet, the IRS isn't wearing a happy face and wants two-thirds of his estate – at least $1.9 billion. In May, the tax agency filed a 113-page court document explaining why it believes the money is owed.
In mid-June, Davidson's estate attorneys fired back with a petition in United States Tax Court in Washington, DC. They said the IRS filing wrongly claimed $2.8 billion in underpayments in estate taxes, gift taxes, penalties, and more.
Given the amount in question, it seems clear this isn't going to be over anytime soon. Observers of the case say this will be a protracted legal battle, not the kind you usually associate with individual wealth.
"It's huge," said Beth Kaufman, a trusts and estate lawyer at Caplin & Drysdale in Washington. Kaufman isn't involved in the case. "Just the sheer dollar amounts involved here are enormous."
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3 weeks 2 days ago by mucar1990