Top 8 Famous Tax Evasion Cases in IRS History

Everyone has to pay taxes. Whether you’re a famous person in politics, music industry or you’re a favorite celebrity, a business tycoon, and a professional sports player; you can’t escape your due taxes. Omitting zeroes, not filing tax returns or you merely neglect your duty, as an American citizen will lead you to a dark secluded area known as prison. In this article, you will learn the top 8 famous tax evasion cases in IRS History, and we hope it will serve as a reminder to pay your due taxes on time!

The Chicago Gangster

The infamous Chicago gangster, Al Capone, was connected to extortion, stealing, and murder and was known as a mob boss who ran the Chicago suburb of Cicero as his private kingdom. He lived like a king and was never charged with his dirty works. He only paid taxes for a measly legit yearly income and was questioned by the federal government about it.

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Gangster Alphonse ‘Al’ Capone poses for a mugshot on his arrival at the Federal Penitentiary at Alcatraz on August 22, 1934 in San Francisco, California. (Photo by Donaldson Collection/Michael Ochs Archives/Getty Images)

Later on, he was indicted for five counts of tax evasion in 1931 and received 11 years imprisonment, which he served at the notorious Alcatraz and the US Penitentiary in Atlanta. He was charged with $7,692 for court costs and fined $50,000. He also paid $215,000 with interest due on back taxes. Capone did not finish his term of imprisonment and was released at the age of 40 due to brain syphilis.

The National Treasure Star

In 2009, considered as one of Hollywood’s highest-paid actors and known for his movies National Treasure, Face Off, City of Angels and Ghost Rider, Nicolas Cage was charged by the US Internal Revenue Service of $6.2 million back taxes fee. It was said that he made $40 million in 2009 alone, but according to the IRS for years, he incorrectly deducted personal expenses and failed to pay his taxes.

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American actor Nicolas Cage attends the press conference for actors on the red carpet of the opening ceremony during the 21st Shanghai International Film Festival on June 16, 2018 in Shanghai, China. (Photo by VCG/VCG via Getty Images)

He was then faced with back-to-back charges from the IRS and on his defense; he sued his manager for negligence and fraud. Cage’s manager filed a counter-complaint to the lawsuit and stated that he warned Cage that he was living beyond his means. Nevertheless, the tax trouble cost Cage a castle, houses, and even Action comics. These days, Cage is still paying his remaining debts.

The Queen of Mean

Leona Helmsley is a self-made businessperson and real estate, tycoon. She was infamously known as the “Queen of Mean,” and was popular for a quote in her tax trial, where she uttered, “We don’t pay taxes. Only little people pay taxes.” Her tax evasion story started in 1983 when her contractors sued her for non-payment of the Dunnellen Hall remodeling bill.

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Leona Helmsley during Leona Helmsley Leaving the New York Federal Court House – July 20, 1989 at New York Federal Court House in New York City, New York, United States. (Photo by Ron Galella, Ltd./WireImage)

During the court proceedings of her lawsuit, it was revealed that most of the contractors’ work was illegally billed to Helmsley’s hotels as business expenses, and because of this, a federal criminal investigation was started. Leona Helmsley was then convicted of one count of conspiracy to defraud the United States, three counts of tax evasions, sixteen counts of assisting in the filing of false partnership and corporate tax returns, ten counts of mail fraud and three counts of filing false personal tax returns. She served 18 months in federal prison, two months on house arrest and one month in a halfway house. Helmsley died on 2007 and left her Maltese dog of $12 million trust fund, which was hailed, 3rd in Fortune magazine’s “101 Dumbest Moments in Business” of 2007.

The IRS Tapes: Who’ll Buy My Memories Case

Willie Nelson is one of the most renowned artists in country music, and he was known for music such as Stardust, Shotgun Willie, Red Headed Stranger and “We are the World with Dionne Warwick. While famous for his music, Nelson made headlines when the IRS seized most of his assets and was dinged $16.7 million bills for back taxes from his album the Red-Headed Stranger.

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SInger-songwriter Willie Nelson performs onstage with Willie Nelson and Family during the 45th Annual Willie Nelson 4th of July Picnic at Austin360 Amphitheater on July 4, 2018 in Austin, Texas. (Photo by Rick Kern/WireImag

It turned out that while Nelson had been on the road, his accountants hadn’t paid his taxes for many years and his situation worsens when Nelson made weak investments in the 1980s. His lawyer negotiated his case, and the charged was down to $6 million back taxes, which Nelson didn’t comply. Nevertheless, Nelson made a double album entitled, “The IRS Tapes: Who’ll Buy My Memories” with profits that went directly to the IRS. The IRS collected $3.6 million from the sales of the album and Nelson’s career skyrocketed and later on, he was able to pay off his debts.

The US Vice President who resigned

Included in our list of Top 8 Famous Tax Evasion Case is a former vice president of United States of America. Spiro T. Agnew, the 39th Vice President of the United States in the Republican administration of President Richard Nixon, was known as the only second vice president to resign in the office in 1973 after being charged with conspiracy, tax fraud, and bribery.

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Baltimore: Spiro Agnew, flanked by Secret Service agents, leaves Federal Court 10/10 after pleading no contest to tax evasion charges and admitting in 1967 he did not pay taxes on taxable income. Agnew announced that he had resigned as vice president to spare the nation a long period of national uncertainty. 10/10/1973

Spiro Agnew was prosecuted by a prominent US attorney, George Beall when the latter opened an investigation in Baltimore City, which Agnew was rumored to be involved. Agnew was then charged with accepting bribes of more than $100,000. Initially, he refused to resign if indicted but later on agreed to resign. He then received three years’ probation and was fined $10,000 for his actions. After his tax scandal and bribery, he became a business consultant and a novel writer. He died of Leukemia on September 17, 1996.

The Jack-Of-All-Trades

O.J. Simpson or Orenthal James Simpson is a famous football player, actor, advertising spokesperson, broadcaster, armed robber, kidnapper and tax evader. He’s like the Jack-Of-All-Trades for doing both good and bad things on his lifetime.

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Photo Credit: Gettyimages

While Simpson was acquitted of his controversial murder case, he was convicted of armed robbery and kidnapping and was sentenced for 33 years with a possibility of parole after nine years. During his imprisonment due to armed robbery, he was charged with multiple liens by the IRS amounting to $1.4 million. Last year he was granted parole and was released on October 1 after nine years of imprisonment. Currently, Simpson is still paying debts to his civil lawsuit against the Goldman family, which amounted to $33.5 million apart from his tax cases.

The Survivor Winner

Americans were watching when Richard Hatch won $1 million from the pioneering reality show “Survivor.” He was the first ever winner of the CBC’s reality TV show and instantly became famous. Hatch received a form of 1099-MISC for his winnings, but he failed to pay the due taxes and later on spent 51 months in the federal prison on 2009.

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SEPTEMBER 03: Actor Richard Hatch talked about his upcoming film, Diminuendo at Dragon Con on September 3, 2016 in Atlanta, Georgia. (Photo by Bill Watters/WireImage)

After his release, he was ordered back to jail on 2011 for not amending to his 2000 and 2001 tax returns. He was sentenced for another nine months in prison. These days, Hatch is producing television shows as his career.

Largest Tax Evasion Case

Our last but certainly not the least is the most significant tax evasion case in United States History, which involves no other than the former telecommunication executive, Walter Anderson. Walter Anderson started making headlines when he attempted to rescue Russia’s Mir Space Station and turned it into a tourist destination, but his positive popularity went down the hill when he was convicted in the most massive case of personal tax evasion in US history.

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Source: nydailynews.com

A grand jury prosecution verified that Anderson led businesses through corporations in Panama and the British Virgin Islands to conceal that it was personal income. During this time, it was reported that he earned a half a billion dollars. Anderson was then charged due to hiding approximately $365 million worth of income after series of investigations. He pleaded guilty in 2006 and was sentenced to nine years in prison and restitution of $200 million. He completed his sentence on 2012. After his release, he didn’t changed much but insisted on his innocence and remained unrepentant. He continued doing entrepreneurial ventures.