On April 2, superstar Lionel Richie performed a song from his smash new album, Tuskegee, to wild applause on The Ellen DeGeneres Show. That same day, the Internal Revenue Service slapped a $1.1 million lien on the singer for income taxes allegedly unpaid in 2010.
Today is the deadline for Americans to file their federal income taxes. Celebrities and entertainers are no different, except -- unlike most taxpayers -- they often have huge incomes that vary wildly from year to year. This is a recipe for tax trouble that can follow even the most successful performers.
Richie is one of the top-selling recording artists of all time and has no history of financial problems. With more than 25 gold and platinum records behind him and a new album near the top of the charts in North America and Europe, Richie is unlikely to have trouble paying a $1.1 million tax bill. "I was recently made aware of the situation by my new team, and it is being handled immediately," he said in a statement.
Many other entertainers -- the famous or once-famous -- are not so lucky. They may lose their mansions, fancy cars and expensive lifestyles unless they are rescued by a hit that makes them rich again.
USA TODAY examined public records and found more than 50 people prominent in the entertainment industry who owe at least $50,000 in back taxes to the federal government, according to IRS tax liens. Many also are behind on state income taxes, according to legal filings.
The tax-challenged include some tabloid favorites: Lindsay Lohan owes $230,904, IRS filings show. Others are respected performers, athletes and award-winning screenwriters or directors several years removed from their last big success.
Actress Sally Kellerman, who was nominated for an Oscar for her role as "Hot Lips" in the 1970 movie M*A*S*H, owes $769,861 in back taxes to the federal government, plus $201,311 to the state of California, according to federal and state liens.
Musicians appear especially prone to tax problems. Singer Roberta Flack, who had era-defining hits in the early 1970s, has $156,824 in federal tax liens.
USA TODAY tried to contact all people mentioned in the story through agents, publicists, accountants, lawyers and via some written letters. Several agreed to comment on the tax liens. Others declined or may not have received the request.
A window to their lives
Federal tax liens provide a rare but imperfect glimpse into the private finances of the rich and famous. The IRS files liens in county courthouses when it believes taxpayers are dodging their obligations, usually from several years earlier and after warning letters have failed to get the money.
The IRS does not discuss or publicize the liens, nor does it provide a database or list of the filings. As a result, tax debts of well-known performers -- or investment bankers, doctors and plumbers -- can hide in plain sight at a county courthouse. USA TODAY used the Nexis database service to search tax liens in affluent ZIP codes.
What is a federal tax lien? The IRS says it is "the government's legal claim against your property when you neglect or fail to pay a tax debt. The lien protects the government's interest in all your property, including real estate, personal property and financial assets."
In other words, the government thinks you're a deadbeat and is warning that it may seize your house, car, bank accounts, gold records and Oscar statues if you don't pay. In practice, the government prefers cash and avoids taking houses and other property except as a last resort. Country legend Willie Nelson lost nearly everything to the IRS at auction in 1991. (He hid his guitar.)
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