Tax Watchdog

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Posted by Robert Snell (The Detroit News) on Fri, Nov 20, 2009 at 10:50 AM

Cartoon king clobbered by tax bill

Won't be long before those retro animated classics "Rudolph the Red-Nosed Reindeer" and "Santa Claus is Comin' to Town" start airing on TV. Turns out the executive whose company owns the shows owes more than $875,000 in delinquent state taxes, according to public records.

Eric Ellenbogen is co-CEO of Classic Media, which acquires, owns and manages a vast library of children's and family entertainment shows and characters, including Lassie, Mr. Magoo, "Fractured Fairy Tales," and our personal faves, "Shazam!" and "Fat Albert."

Ellenbogen, 52, is the former president and CEO of Marvel Entertainment, who helped secure a film deal for the "Spider-Man" franchise. He recently listed his restored penthouse condo in New York City for $10 million.

What's owed:

  • The state of New York filed an $875,488 tax warrant against Ellenbogen on Aug. 13 with the New York County Clerk.

His side:

In an e-mail, Ellenbogen did not explain what led to the tax debt.

"I'm not sure I'm worthy of the attention, but recognize this is a matter of public record," he wrote. "The liability is in dispute and is with my accountants."

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Posted by Robert Snell (The Detroit News) on Thu, Nov 19, 2009 at 6:17 AM

Martha Reeves sings payday blues

Soon-to-be-booted Detroit Councilwoman Martha Reeves has "Nowhere to Run" from voters, who bounced her from office, or the IRS, which filed a new $15,413 tax lien against the Motown legend, records show. Add that to the more than $200,000 Reeves, 68, already owes in delinquent taxes.

Reeves' last meeting as a councilwoman could be Friday unless the panel decides to return from a planned recess until January. To commemorate the occasion, here's a recap of the singer's duets with the tax man:

What's owed:

  • The IRS filed a $15,413 lien against her on Aug. 17 with the Wayne County Register of Deeds.
  • The IRS filed a $9,470 lien against Reeves on June 8 with the Oakland County Register of Deeds. According to this lien, she owes income taxes from 2006.
  • The state of Michigan filed a $7,392 lien March 28, 2008, for unpaid single-business taxes.
  • The IRS filed a $193,167 lien Dec. 26, 2006, for unpaid income taxes from 1997 through 2003.

Her side:

Reeves did not return a call seeking comment. Previously, she blamed the tax debt on a drop in revenue from dwindling record sales, infrequent concert performances and a former accountant.

She also has said the government takes most of her approximately $80,000 City Council salary -- leaving her with $331 every other week.

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Posted by Robert Snell (The Detroit News) on Wed, Nov 18, 2009 at 1:38 PM

Big debt makes Big Boi tax outcast

Antwan "Big Boi" Patton, rapper/songwriter/record producer/pit bull breeder/actor and one half of the platinum-selling duo Outkast, owes more than $55,000 in delinquent state taxes, records show.

The 34-year-old Georgia native and philanthropist also has a solo career and is due in town next month at MotorCity Casino to celebrate the release of his debut CD.

Outkast has a thorny connection locally. In April 2005, about six months before civil rights icon Rosa Parks died, lawyers reached a confidential settlement with companies that sold the 1998 album by OutKast, which included the unauthorized song "Rosa Parks."

What's owed:
The state of Georgia filed a $55,727 lien against Patton and his wife on June 1 in Fulton County Superior Court.

His side:
Patton could not be reached for comment and a message was left with his charitable foundation.

Bonus clip:
Check out Big Boi's crib, which comes complete with shark tank, stripper pole and obligatory "Scarface" posters.

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Posted by Robert Snell (The Detroit News) on Tue, Nov 17, 2009 at 10:54 AM

Tommy Armour trapped in deep bunker

The U.S. Department of Justice has asked a federal judge to order the sale of PGA star Tommy Armour III's home because he failed to pay more than $583,100 in federal income taxes, records show.

On Sept. 23, the feds requested permission to sell Armour's house in Irving, Texas, because the golf star "neglected, failed and refused" to pay income taxes and penalties for the years 2002 and 2005-07, according to U.S. District Court records.

The IRS has filed several tax liens against the house (see below) in recent years and the Justice Department asked a judge to enter a judgment for the unpaid amount.

Armour earned $503,306 this season, a third of what he made last year, and ranked 144th on the PGA tour's money list.


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What's owed:

  • The IRS claims Armour owes $140,725 in income taxes and interest from 2002.
  • The IRS claims he owes $10,764 in income taxes from 2005.
  • The IRS claims he owes $106,323 in income taxes from 2006.
  • The IRS claims he owes $325,288 in income taxes from 2007.

His side:

Armour's lawyer Joyce W. Lindauer could not be reached for comment. But in a court filing, Armour denied that he "neglected, failed and refused to pay the income taxes and penalty assessments."

When the Tax Watchdog first wrote about Armour's tax troubles last year, he blamed the debt on a mix of bad management, inconsistent earnings and his lifestyle.

"If you get used to living a certain lifestyle and you have a couple of bad years, suddenly things start building up," he said. "It's a hole that was dug. I made some bad decisions and had some bad management for a moment."

He also said the IRS misplaced a payment and claimed an agent altered payment arrangements.

"This year, fortunately, I made some money and I took care of this guy but he still thinks I should move out of my house into an apartment, sell my cars and drive a Pinto," Armour said.

Armour also said PGA winnings don't go as far as the public thinks.

"There's a lot of traveling and people you pay -- from trainers and people on your team -- to make this all happen," he said. "I'm not rich by any means, but I'm not going to miss a meal tonight."

Bonus clip:

Take a tour of Armour's house -- and his vast shoe collection.

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Posted by Robert Snell (The Detroit News) on Mon, Nov 16, 2009 at 10:41 AM

Music producer insists debt paid

The IRS and state of Georgia claim Grammy Award-winning producer Jermaine Dupri, the beat master who has worked with artists Mariah Carey, Usher, Jay-Z and a stable of other stars, owes more than $3.2 million in delinquent taxes, records show. But his lawyer insists the debt has been paid.

The 37-year-old Georgia native, whose full name is Jermaine Dupri Mauldin, has been in an off-again on-again relationship with Janet Jackson.

What's owed:

  • The state of Georgia filed a $135,749 lien against him Nov. 17, 2008, in Fulton County Superior Court.
  • The IRS filed a $3,095,004 lien against him Sept. 4, 2008, in the Westchester County (N.Y.) Clerk's office.

The liens amount to a little more than the $3.16 million Dupri paid for this Atlanta pad in 2005.


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His side:

Dupri lawyer James Kane did not explain what led to the tax liens being filed but insisted the debt has been paid.

"I can assist you in telling you that all of the taxes have been paid and my law firm has been, and is, in the process of getting the liens removed in normal course," Kane wrote in an e-mail. "As to any other information, you can certainly understand under the attorney-client privilege that I am not able make any further comment."

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Posted by Robert Snell (The Detroit News) on Thu, Nov 12, 2009 at 1:13 PM

Infamous Hollywood legend slapped with lien

Cop-slapping, Hungarian bombshell Zsa Zsa Gabor owes more than $118,000 in delinquent federal taxes, records show.

It is the latest financial woe facing the 90-something actress, famous for being famous much like her great-niece Paris Hilton. Earlier this year, her lawyer claimed that Gabor lost as much as $10 million in the Bernie Madoff Ponzi scheme.

What's owed:

  • The IRS filed an $118,321 lien against Gabor on Oct. 5 in the Los Angeles County Recorder of Deeds office.

The address listed on the lien is this Los Angeles mansion.


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Her side:

Gabor's lawyer and publicist did not return calls seeking comment.

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Posted by Robert Snell (The Detroit News) on Thu, Nov 12, 2009 at 6:33 AM

'Upper Hand' ad man says resolution near

The IRS claims Farmington Hills ad man Bruce Duffey, the creative guru behind those state-sponsored Upper Hand commercials touting Michigan as a great place to live, work and pay taxes, owes more than $1 million in delinquent taxes. Duffey, however, disputes the lien.

Duffey is partner and chief creative officer of Farmington Hills-based DP+Company. The 63-year-old Milford resident has worked with some of the country's largest and most successful firms, including Anheuser-Busch, State Farm, Betty Crocker, Volkswagen, Audi and Pontiac, according to his company's Web site.

Since 2006, his firm has produced the award-winning "Upper Hand" business marketing campaign, which involves TV, radio, print and Web commercials featuring actor Jeff Daniels.

What's owed:

  • The IRS filed a $1,075,779 lien against Duffey on Oct. 13 in the Oakland County Register of Deeds office.

His side:

Duffey said he has spent almost one year working with an attorney to handle the tax issue and filed a formal appeal of the lien. A resolution is near, he added.

"All requests and returns have been completed and filed," Duffey wrote in an e-mail. "We vigorously dispute the amount. We look forward to their resolution in a matter of a few weeks. Everything has been addressed."

Bonus clip:

Here's a sample of his firm's "Upper Hand" handiwork.

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Posted by Robert Snell (The Detroit News) on Wed, Nov 11, 2009 at 9:57 AM

Tax man brings the noise against Flavor Flav

What time is it? Time to pay your taxes, Flavor Flav. The state of California is accusing rapper turned reality show sell-out Flavor Flav of owing more than $183,000 in delinquent taxes, records show.

Flav, 50, real name William Drayton, is a member of legendary rap group Public Enemy, and lately has starred in several seasons of VH1's reality show "Flavor of Love."

What's owed:

  • The state of California filed an $183,810 lien against Drayton on Sept. 17 in Sacramento County Court.

His side:

Flavor Flav could not be reached for comment. His manager said he forwarded an e-mail message to the rapper.

Bonus clip:

Here's Public Enemy (and Anthrax) before Flav flamed out.

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Posted by Robert Snell (The Detroit News) on Tue, Nov 10, 2009 at 11:04 AM

Tax man won't slide on Black Crowes star's bill

Black Crowes guitarist Rich Robinson needs a "Remedy" for what is ailing him - namely the $1.17 million bill he's facing from the IRS and state tax agencies, records show.

Robinson, 40, along with his brother, lead singer Chris Robinson, formed the Georgia-based band in the 1980s and is a principal songwriter, helping the group sell more than 15 million albums. The band, best known for hits "Hard to Handle" and "She Talks to Angels," once included Cass Corridor's own Eddie Harsch on keyboards.

What's owed:

  • The IRS filed a $139,113 lien against Rich and his ex-wife on June 1 in the Greenwich (Conn.) Town Clerk's office.
  • The IRS filed a $79,122 lien against Rich on March 4 in the Stamford (Conn.) City Clerk's office.
  • The state of New Jersey filed a $6,598 lien against Rich on Jan. 8 in New Jersey State Superior Court.
  • The IRS filed a $391,488 lien against Rich on Dec. 1, 2008, in the Los Angeles County Recorder of Deeds office.
  • The state of California filed an $8,974 lien against Rich on April 23, 2008, in Los Angeles.
  • The state of New York filed a $149,425 tax warrant against Rich on March 26, 2008, in the Albany County Clerk's office.
  • The IRS filed a $400,046 lien against Rich and his ex-wife on March 10, 2005, in the Stamford City Clerk's office.

The address listed on the $79,122 lien is Robinson's former home in Stamford, Conn., which was sold earlier this year at foreclosure auction for $1.2 million. See more photos of his home here.


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Their side:
Robinson has hired tax lawyer Gerard Levins, who is negotiating with taxing authorities to reach a deal and repay the delinquent taxes. An agreement could be reached in less than 30 days.

Robinson already has repaid several hundred thousand dollars in delinquent taxes, Levins said.

"I don't know why the taxes weren't paid on time or whether it was something somebody was supposed to do on his behalf and didn't do it," Levins said.

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Posted by Robert Snell (The Detroit News) on Mon, Nov 9, 2009 at 2:36 PM

IRS/state tax man barking at rap star DMX

Too bad troubled rapper DMX has backed out of a celebrity boxing match, because he could use the money, according to public records. The IRS and state of New York are barking about the $1.5 million he owes in delinquent taxes.

What's owed:

  • The IRS filed a $442,869 lien against DMX and his wife on Jan. 2 in the New York City Register's office.
  • The IRS filed a $663,554 lien against DMX on Sept. 10, 2007, in the Maricopa County (Ariz.) Recorder's office. According to the lien, he owes income taxes from 2002, 2003 and 2005.
  • The state of New York filed an $8,343 tax warrant against the couple on Feb. 15, 2007, in the New York County Clerk's office.
  • The New York State Tax Commission filed a $44,357 tax warrant against the couple on March 6, 2006, in New York.
  • The IRS filed a $370,460 lien against the couple on Sept. 20, 2005, in New York.

Their side:

A DMX publicist could not be reached for comment.

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About this Weblog

Robert Snell of The Detroit News

Who owes taxes in Metro Detroit

Robert Snell is a Detroit News business reporter. He focuses on state and federal tax liens and, based on public records, interviews and Detroit News archives, identifies those who don't pay income, business and property taxes. He can be reached at rsnell@detnews.com or (313) 222-2028.

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Why we focus on unpaid taxes

Every year, about $345 billion in federal taxes are either late or unpaid, according to the IRS, ripping open holes in budgets and shortchanging schools and public safety. That forces taxpayers to cough up more than their fair share, tax experts say. About $2.5 billion went uncollected in Michigan between 2000 and 2006.

Liens are filed when taxpayers ignore government pleas for payment. Tax liens are like tar. They stick to everything - homes, cars and income. According to the IRS, liens give the government a legal claim to a person's or company's property. Liens serve as security or payment for the tax debt and a red flag to creditors.

There are a variety of reasons people don't pay. Some can't afford to and some refuse while others miscalculate or receive bad advice. Unpaid taxes can lead to prison - just ask actor Wesley Snipes.

This blog will focus on state and federal liens and identify those who don't pay income, business and property taxes. We will gather our information from public records, interviews and Detroit News archives.