Michael Jackson Was A Half-Billion Dollars In Debt When He Died: New Court Docs Reveal Financial Struggles

Michael Jackson, the King of Pop, was drowning in debt when he died in 2009. He was over $500 million in debt before his sudden death in 2009 as revealed by the new court documents. Although the King of Pop’s financial troubles had been reported before but the full extent of his financial woes is only now becoming clear. The pop star was on the brink of bankruptcy when he passed away suddenly at age 50. His death came just as he was preparing for a big comeback tour. This Is It, was the tour that was meant to help Jackson earn money to pay off his debts. Sadly, he never got the chance.

The court filing revealed some super shocking details. One of which was that Jackson owed money to more than 65 creditors when he died. He was also involved in lawsuits in several states and countries. His biggest single debt was $40 million owed to AEG, the company promoting his planned London concerts. It seems Jackson's lavish spending habits were to blame for such dire financial straits. He bought expensive jewelry, art, and furniture, traveled a lot, and gave money to charity but his income couldn't keep up with his spending.

Jackson's debt had been growing for years. By 1998, he owed $140 million, and over the next decade, his debt increased by about $170 million more. High interest rates on his loans made the problem even worse. The pop star used his valuable assets as collateral for loans and this included his stake in a song catalog featuring Beatles hits. Even this wasn't enough to keep his finances afloat though. Despite his money troubles, Jackson was determined to make a comeback. Randy Phillips, former CEO of AEG Live, said Jackson was ready to "clean up his finances. He was ready to stop living like a vagabond and settle down and earn money again." The planned tour was part of this effort.

After Jackson's death, his estate faced huge challenges. The executors had to deal with the mountain of debt and numerous legal issues. They claim to have settled most of the creditors' claims and lawsuits. They also say they've enhanced Jackson's "image and legacy" for his beneficiaries. These beneficiaries include Jackson's three children: Paris, Prince, and Bigi. His mother, Katherine, is also a beneficiary. However, they haven't been receiving money from the estate due to an ongoing tax dispute with the Internal Revenue Service, as per The Guardian.

Remarkably, despite starting over $500 million in debt, Jackson's estate is now worth an estimated $2 billion. This turnaround owes it all to the estate's executors and their legal team as they renegotiated loans, restructured deals, and made some seriously smart business moves. One great example is when they got a piece of EMI Music Publishing, which owns copyrights to loads of famous songs. Then in 2018, they flipped that stake to Sony for a cool $300 million. This deal alone gave them around 5,000% return on their initial investment, as per People.