When it comes to federal and state income taxes, there’s no such thing as a free lunch. Each time you rake in the dough, the authorities want their cut.
Tax fraud is not to be taken lightly. And if you don’t pay, there’s a chance you can be slapped with an exorbitant bill for delinquent taxes and possibly earn yourself a trip to jail. Learn about about the seriousness of tax fraud here, and take warning from some celebs that didn’t get the memo:
This movie star was known for his stunning performances on the big screen. Too bad he didn’t play by the rules when he was off camera. Snipes managed to conceal a handsome amount of income, which resulted in a tab of $17 million payable to the IRS. The legal system showed no mercy, even after he attempted to begin making payments, and Snipes earned himself a trip to the slammer in December 2010 for an extended stay of three years.
Martha Stewart has long been hailed as the queen of “everything arts and crafts.” But in 2004, she earned the title of “tax evader” after she was convicted of insider trading. Not only did she earn a trip to prison, Stewart was also presented with a bill for back taxes and penalties from the state of New York in the amount of $220,000. Fortunately, it didn’t take long for her to bounce back, thanks to a comeback campaign that was launched in 2005 and helped her company return to the black a year later.
As a musical genius and raking in millions doesn’t exempt you from paying the IRS its piece of the pie. Marc Anthony failed to file returns between 2000 and 2004 and was subsequently hit with a $2.5 million tax bill, based on earnings of $15.5 million. Hefty, to say the least, but he was lucky enough to avoid the jail cell because of the intent principle; Anthony claimed he was falsely notified by his accountant all returns had been filed and everything was under control.
Throughout his baseball career, Strawberry was riddled with issues both on and off the field; tax evasion was one of them. In 1995, he finally struck out when indicted for tax evasion, stemming from unreported income on memorabilia and appearances. End result: a $430,000 tax bill from the IRS.
The Academy Award winner learned the hard way about completely trusting others to handle business and financial affairs. Mismanagement of investments and poor accounting resulted in a tax lien of $14 million from unpaid income and property taxes. Busy or not, it simply doesn’t pay to turn a blind eye.
Survivor-superstar Richard Hatch escaped the harsh conditions of extended island living, but he couldn’t dodge the IRS. Under the impression that CBS would pay the tab, Hatch went about his merry way and was slapped with a prison sentence of 3 years. Not only did Hatch fail to pay taxes on the prize money, but he also pocketed $28,000 in proceeds from a rental property and earnings from a Boston radio show.
So, what can you learn from all of this? The government will catch you! Pay your taxes, just like the rest of us, and live happy knowing the IRS will leave you alone.