IRS: Sumner Redstone Owes $1.1 Million Over Unpaid 1972 Tax
The billionaire mogul neglected to file a return on a taxable gifts to his children.
Sumner Redstone has been battling the IRS over $1.1 million he allegedly owes because of a 41-year-old tax liability, Bloomberg reported Wednesday.
An attorney for Redstone didn’t respond to a request for comment Thursday.
The IRS says that the billionaire chairman of CBS and Viacom failed to report giving a gift of stock in National Amusements -- majority owned by Redstone -- to son Brent and daughter Shari in 1972.
Redstone, who turns 90 on May 27 and is worth an estimated $4.9 billion, says the stock wasn’t a taxable gift but “an ordinary business transaction” that was the result of an intra-family lawsuit.
The Bloomberg article cites multiple tax experts who note how unusual the IRS is behaving in the matter. “I can’t remember ever hearing of anybody going back 41 years to raise an issue. It’s really unprecedented in my experience,” says one. “They have to have a reason for being so riled up,” says another.
The “bitter family dispute” that is at the heart of the IRS claim, according to a petition, involved Redstone’s late brother Edward’s threat to sell shares of National Amusements outside the family. A settlement resulted in the brothers directing the shares to their children.
Redstone’s petition makes the point that the IRS has never before claimed that the stock was a taxable gift, “despite many opportunities during 41 years.”