Taxes Blog

Finance Blogs » Taxes » Snipes jailed on tax conviction

Snipes jailed on tax conviction

By Kay Bell · Bankrate.com
Friday, December 10, 2010
Posted: 11 am ET

Amid all the tax-cut plan brouhaha this week, another key tax story slipped by relatively unnoticed.

Wesley Snipes reported to federal prison on Dec. 9 to begin serving his three-year sentence for not filing tax returns.

The actor, best known for his roles as the title character "Blade" in the vampire hunter movie trilogy, has been fighting jail time almost as long as he's scheduled to be incarcerated.

Snipes was convicted in 2008 of three misdemeanor counts of willful failure to file income taxes, getting a year for each charge to be served consecutively. During the trial, federal investigators presented evidence that Snipes owed $2.7 million in taxes from 1999 to 2001.

While Snipes apparently had enough money left over to pay his attorneys and cover the costs of all his ultimately unsuccessful (so far) appeals, most of us would have just headed straight to jail.

So the Snipes case offers three good lessons on how to avoid ending up in the same tax predicament.

First, file your taxes. The penalties for not filing are actually steeper than for not paying.

Of course, as Snipes' case indicates, the Internal Revenue Service does want its money, too. So pay your taxes. The IRS has stepped up enforcement in recent years -- and not just when it comes to celebrities.

Second, pay what you owe.

During his legal battle, Snipes has continually maintained that he paid Uncle Sam what he believed he owed. Guess what? The federal government's numbers usually are the ones that hold up.

If you do dispute your tax bill, contact the IRS and discuss it and possible tax payment options.

Finally, get good advice.

Snipes tried to shift some of the unpaid tax blame to his financial and tax advisers. As he found out, that usually won't work either.

When you sign a tax return, regardless of who filled it out, you're responsible for what's on it.

And if, like Snipes, you don't file a tax return, you can't simply get away with that oversight by saying that's what your tax professional told you to do.

That's why it's so important to hire a reputable tax pro. You've got lots of choices. Pick the one that best fits your tax needs.

And be sure to thoroughly check out that tax pro. If you get bad tax advice, you, as Snipes discovered, will be the one paying the price.

In addition to tax information on Bankrate, get more news, money-saving tips and expert advice by signing up for a free Bankrate newsletter.

«
»
Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
3 Comments
Joe
January 13, 2011 at 6:01 pm

Should we use "Billy Bong Thornton or Wesley Pipes?"

Amy
December 11, 2010 at 4:06 pm

The land of the free is expensive......