Jacqueline Kennedy Onassis' estate was worth far less than was widely estimated at the time of her death, and her two children will get most of her assets, leaving very little for charity, according to the state attorney general's office.
The former first lady's executors valued her estate at $43.7 million, court documents show, though the fantastic prices some of her property brought at auction have prompted an IRS audit to determine whether its true value was closer to $73 million.In any case, the amount falls well short of the estimates of $100 million or more in many news reports after her death in 1994. So far, less than $500,000 of the estate has gone to a nonprofit organization, the John F. Kennedy Library near Boston.
Onassis' will left her two children valuable properties, ranging from a Martha's Vineyard retreat to stocks. But it also gave them the option of letting some or all of these properties pass to a charitable trust, which would have made annual donations to charities for 24 years and then dissolved, passing the money on to Onassis' grandchildren.
The device of the charitable trust was essentially a way for Onassis' children, Caroline Kennedy Schlossberg and John F. Kennedy Jr., to allow some of her assets to pass to her grandchildren without paying estate taxes. But there was no requirement in the will that any money go to the trust, and the children have apparently determined that it makes more financial sense for them to pay the estate taxes and invest the balance.
The trust would have been called the C&J Foundation, after the first initials of the children.
Onassis' executors have told the state that after distributing the property that the children decided to keep, making specific bequests and paying administrative expenses, the estate has $18 million but owes $23 million in estate taxes.
"Given the administrative expenses and the taxes and the consequences of the choices of the children, there will not be a residuary to create the C&J Foundation," said Jennifer Farina, a spokesman for Attorney General Dennis Vacco.
The $5 million shortfall - which the children are liable for - almost certainly means that "there will not be a C&J Foundation," said Sean Delaney, chief of the attorney general's charities bureau.
Alexander Forger, one of the executors, confirmed that Onassis' charitable lead annuity trust does not exist, though he would not rule out the possibility that it might still be created.
Many publications and outside analysts had assumed that Onassis' real estate and personal property would go to her children and that the remainder of her estate would go to the charitable trust. Based on estimates that the estate would be worth $100 million or more, there was widespread speculation that charities would receive as much as $192 million and that the grandchildren would inherit perhaps $98 million in 2018, when the trust was to have dissolved.
Many of the properties that the Kennedy children decided to keep were auctioned last April by Sotheby's for $34.5 million. Earlier, those items were valued at less than $6 million, according to an informal accounting document made available to the New York Times.
Forger said that the IRS is auditing the Onassis estate, and the principal issues are whether the auctioned items will be taxed as part of the estate or as the children's property. If the auction proceeds are taxed as part of the estate, the federal tax would be 55 percent, but if they are treated as capital gains, the tax would be 28 percent.