No matter how rich and famous you are, you still have to pay taxes or pay the penalties, or possibly need tax debt relief. We’ll take a look at 12 famous people – six this week and six next – who thought that they could get away with cheating the system.
- Walter Anderson, Telecommunications Tycoon
In 1998, Anderson claimed an income of just under $68,000 and paid $495 in taxes, when he actually earned more than $126 million that year. He hid his money in offshore accounts, shell companies and drop boxes in Europe. On Sept. 8, 2006, he entered a guilty plea for failing to file income taxes for 1998 and 1999 and for defrauding the District of Columbia. The plea deal included his admittance to hiding $365 million from the government. He was sentenced to prison and released on Dec. 28, 2012. The U.S. Tax Court later determined that he owed the IRS more than $247 million in interest and penalties. Walter Anderson certainly could have used proper tax debt relief assistance.
- Dennis Kozlowski, Disgraced CEO
The former chairman of Tyco International, Dennis Kozlowski bought 12 paintings for $14.7 million but failed to pay taxes on them. He was indicted in 2002 but eventually settled the case for $21.2 million reaching a tax debt relief settlement. However, he was convicted, along with the company’s former chief financial officer, of bilking Tyco of more than $600 million. He served a prison sentence that dated from Sept. 19, 2005, to Jan. 17, 2014.
- Wesley Snipes
A member of a group who believes that federal taxes are unconstitutional, Snipes owes $17 million in taxes, interest, and penalties. He was convicted of three misdemeanor counts of failure to file taxes, and subsequently sentenced to three years in jail at McKean Federal Correctional Institution in Pennsylvania. He failed to file returns between 1999 and 2001 or report more than $14 million in earnings. His attorney should have worked harder to work a deal with the IRS via some sort of tax debt relief program, versus fighting the system.
- Willie Nelson
Willie Nelson’s tax problems date back to 1984, after an audit looked at returns as far back as 1972. The IRS claimed that he owed more than $6 million in taxes along with an additional $10 million in penalties and interest. The country singer’s accountant had claimed tax shelters that the IRS did not accept, therefore he wasn’t entitled to any tax debt relief at the time. After his assets were seized and sold, friends purchased his possessions, returning them. He eventually reached a tax debt relief settlement with the IRS.
- Al Capone, Mob Boss
The federal government could not catch Capone in wrong doing, so instead targeted him for evading income taxes. Frank Wilson investigated him for three years after agents infiltrated the mob. Capone pled guilty in 1931 to tax evasion, and he was directed to pay $215,000 plus interest, or over $3 million in today’s money. I don’t think the IRS would have granted any tax debt relief even if the mob boss had asked for it.
- Lauryn Hill
Multiple Grammy award winner Lauryn Hill failed to file taxes between 2005 and 2007, resulting in $1.5 million in delinquent taxes in addition to interest and penalties. She was charged with three counts of failure to file taxes and eventually sentenced to three months in prison, although she could have faced as long as three years. Versus attempting to reach a tax debt relief settlement, Lauryn Hill chose jail time. Bad advice and planning in our humble opinion.
Instead of attempting to avoid paying taxes, work with a qualified professional tax firm to see if you qualify for tax debt relief with the IRS. For help today, contact our firm at 720-398-6088.