Tax & Accounting News

Funny Comedian Chris Tucker gets hit with a not-so funny $14 million dollar lien

by
Jason Feist
on
10/23/2014
Funny Comedian Chris Tucker gets hit with a not-so funny $14 million dollar lien

We all know funny man Chris Tucker from movies like "Friday" and "Rush Hour," but the hilarious actor/comedian was recently hit with a $14 million tax lien. Reports say he ran up additional back taxes for seven years. This does not come as a surprise, as celebrities typically have multiple handlers associated with their finances.

Tax liens can only be filed after several prior notices. Once you are notified, if you fail to pay the debt within a 10-day period, the IRS can then formally file a lien if it chooses. The IRS initially sends out a Notice of Federal Tax Lien, followed several days later by a Notice and Demand for Payment. Tax liens are serious matters and are not meant to be taken lightly. IRS liens can damage your credit and typically last 10 years. Federal tax liens most commonly impact real estate. Paying off a lien involves paying off the tax, interest and penalties or posting a bond to guarantee payment.

Can you beat a tax lien? Rarely. Usually the IRS does not make mistakes. If the IRS thinks you owe money and you haven't paid, expect a lien to be filed. Dionne Warwick was slapped with a $2.2 million federal tax lien in 2009. The IRS later revoked it secondary to a mistake, but not without a $1 million penalty.

What is the different between a lien and a levy (seizure)? A tax levy involves taking your property. This can include your wages, bank accounts and even retirement accounts. Seizures won't end there! The IRS can seize your house, car or business equipment. It does not need to provide any initial notice or file a lien to follow with a levy.

Although Tucker settled with a lower bill, IRS liens are extremely powerful tools for the IRS to have up its sleeves. You must be aware of the differences between a federal tax lien and a levy and if to the point the IRS files a lien against you, you will pay. It is important to have your taxes and finances looked at by a professional, and if you are given a notice of lien or levy, you should communicate with the IRS promptly.

share this post
Search for matches...
Jason Feist

Jason Feist

Jason Feist hails from Ohio and graduated with honors from the University of Cincinnati where he holds a bachelor's degree in accounting. He has a combined 15 years of financial and accounting experience and for the last 7 years he has been the Managing Partner of Empowered Insights - a pioneer in the accounting industry. The mission of Empowered Insights is to be one of the leading firms enriching peoples lives and growing businesses. They specialize in tax preparation, business accounting and consulting.

Empowered Insights
8 reviews

Ohio

Recommended Professionals

In the face of economic uncertainty, TaxBuzz is the industry's most up-to-date tax information.

Join 60,000 who get our weekly newsletter. No spam.

We know tax and accounting issues are complicated.

Do you have additional questions on this topic for this author?

Related Posts

Latest Posts