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Pacino promptly pays tax lien

By Kay Bell · Bankrate.com
Tuesday, August 20, 2013
Posted: 3 pm ET

Al Pacino is famous for playing movie criminals such as Michael Corleone in "The Godfather" series and Tony Montana in "Scarface." But in real life, the Oscar winner is quick to get back in the good graces of tax enforcers.

After being slapped this spring with a $31,706.04 tax lien by the state of California, reportedly for unpaid Golden State taxes from 2009 and 2011, Pacino promptly paid off the tax debt.

California officially released the lien July 31, according to the celebrity website TMZ.

The state tax issue was not Pacino's first run-in with tax collectors.

In 2011, the Internal Revenue Service filed a lien against Pacino for $188,283.50 in connection with unpaid taxes in 2008 and 2009. In this case, the tax issues were related to a Ponzi scheme in which several Hollywood stars were caught.

Tax lien entanglements

Even if you have good reasons for not paying a tax bill, the bottom line is that the nonpayment is likely to lead to a lien.

The result is more than just embarrassment from having your tax situation revealed in public records.

The lien will show up on your credit report, making it at best difficult and at worst impossible for you to get a loan for a car or house.

Many employers also check credit reports when making hiring decisions.

And your property is tied up until the tax agency releases its claim.

Avoiding tax liens

The best way to avoid this embarrassing and costly situation is to pay the tax you owe on time.

It that's not possible, contact the tax office. This lets the agency know you're not avoiding the bill and in many cases, the tax collector will work with you. IRS options include installment payment plans and offers in compromise that allow you to settle your tax bill for less than is due.

Also remember, the IRS does make mistakes. If it files a lien by mistake, you need to file an administrative claim with the IRS to have the lien removed.

Regardless of whether the lien was in error or you neglected to pay your tax bill, once the debt is paid off and the IRS releases the lien, get a copy of that official action. Then send it to all the credit bureaus so your files can be updated and you can say "goodbye" to that unwelcome little tax friend.

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You also can follow me on Twitter @taxtweet.

Veteran contributing editor Kay Bell is the author of the book "The Truth About Paying Fewer Taxes" and a co-author of the e-book "Future Millionaires' Guidebook."

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35 Comments
Tim
September 08, 2013 at 10:57 am

M is often used in accounting to mean 1000, as in the Roman numeral M. MM is used to represent million. Given the prevalence of computer terms (where M represents million), I think it is unwise to use the accounting variant because I have seen it cause confusion on multiple occasions.

Kimberly
September 07, 2013 at 10:35 pm

Who cares we all owe, owe, owe - off to work we go.........

Charles
September 07, 2013 at 2:17 am

I have seen this over and over again as reasonably intelligent people of wealth fall for get rich schemes, tax deferals that aren't or idiots that convince them that taxes aren't obligatory or legal. Don't be too hard on him, at least he paid.

We had a good friend loose her business of thirty years by listening to some crook that filed her taxes and several other business owners and found them huge tax breaks that didn't exist. He disappeared the the IRS siezed their property and closed down their businesses.

The moral of the story; Find a certified accountant and pay what you owe. Period.

Paul
September 07, 2013 at 12:25 am

Wonder which school he graduated from, it would be sad if he even has a college degree. These types of errors will become more common as our education system falls further and further behind in the world. Once upon a time our country was a dream to live in and now it's starting to become pitiful.

Big Louie
September 06, 2013 at 8:27 pm

News rags are constantly lying on headlines to hook readers. There was one yesterday on CNN that said "Arron Hernandez photographed with slain men," leading the reader ot believe that he was caught in a photograph slaying men. But when you read it, it said that he was in a survaliance photo at a nightclub at the same time that those men were there... along with hundreds of other people. And then they shut the comments off so no one could complain. Whoever did that ought to be slapped upside the head or fired.

Josh J
September 06, 2013 at 6:41 pm

Come on the link said 30 MILLION... 30 grand is nothing to a celebrity CNN... Come On Man!

hle
September 06, 2013 at 11:56 am

Jeff, you are right! They probably did that on purpose just to get people to click on the link. The advertisers on this page don't care about the error, as long as they have hits and traffics.

W/ Ad-driven industry, we can all but wonder if the kind of news we got are any good, unbias, accurate, complete. Cuz those kind of things ARE NOT GOOD for ads. Everything must be "shocking," "perverted," "divisiveness," "controversial..."

jeff wright
September 06, 2013 at 9:12 am

it's $30 thousand ($31,706.04), not $30 million stated in the CNN link... that's 3 extra 0s!!!... not 1 or 2, but 3!!! so now CNN is hiring reporters that can't even recognize the difference between thousand and million...

Robert DePasquale
August 29, 2013 at 10:51 am

The IRS is the worst agency ever created, they are ruthless and have no sympathy whatsoever

They add an incredible amount if interest and or penalties, so if you cannot pay the original amount owed. How can you pay off any additional amount.

Rich D
August 21, 2013 at 4:24 pm

In addition to sending you a notice of the lein, the IRS also sends copies to all the local banks in your area, suspecting you may have accounts with one or more of them with money in them. The Levy/Lein via the IRS, gives your bank the right to freeze funds and send whatever is in your acct, to the IRS. So as your checks begin to bounce, sure you can call and yell at the bank and complain, but they won't help you.
A tax lein/aka: a levy can be used to debit your checking and savings accounts. (they will leave you with a few dollars however,) note: States issue Leins and Levy's also.