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NEWS > ENTERTAINMENT > CELEBRITIES FINALLY REALIZE THEY DON’T NEED TO PAY TAXES
CELEBRITIES FINALLY REALIZE THEY DON’T NEED TO PAY TAXES
October 18 2009
Hollywood, CA – For as long as they have existed people have hated paying taxes. From the first recorded instance of taxation, approximately 3000 B.C.E. in Egypt, people have been complaining about paying them. Though taxes pay for many of the 
amenities we take for granted the idea of the state imposing a levy on the people continues to bristle many on all sides of the economic and social spectrum despite the general acknowledgment that we will never be able to fully escape the fee.
Of course, celebrities aren’t the same as regular people and now many are finding that with their popularity come certain other advantages. Celebrities ranging from Stephen Baldwin to Method Man to, most recently, Nicolas Cage have all found ways out of paying taxes. With the list of tax free celebrities growing larger every day many in the Hollywood community are considering a switch, realizing for the first time the benefits of not paying taxes, and finally taking full advantage of the privilege of being a celebrity.
“It’s a funny thing but despite high-paid and high powered people behind them most 
celebrities don’t realize that they don’t have to pay taxes. Exempting celebrities from the taxation systems has been a part of the legislation pretty much from the beginning but so few people take advantage of it. I don’t know if it’s that they are getting bad advice or if the people doing their books are just jealous but for some reason we see very few claims to avoid taxation,” said Kevin Kearns of the IRS. “Basically there is a set of requirements that people have to meet and they simply submit a form and presto, they are tax free. This isn’t something for the average person because you need a certain body of work – singles released, movies appeared in and gross domestic gross – things like that. But once all the forms are filled out they never have to pay taxes again. We even give them a card to free them from sales tax and every year they are sent a gift basket from the agency. I can tell you we send out very few baskets.”
Other benefits of being a celebrity include a ‘Tax-Freed’ t-shirt and a free subscription to Martha Stewart Living magazine. Stewart is one of the few celebrities who takes advantage of the system.
“It’s funny that people like Wesley Snipes and Stephen Baldwin find out about this but big names like say Harrison Ford or Will Smith are stuck paying through the nose. It could be that their accounting people feel a little sorry for them or it could be that they have so much spare time that they are able to study the tax code and make good on the opportunity,” said Scrape TV Entertainment analyst Tracey Temple. “With Nicolas Cage making good on the system it’s likely far more A-level talent will catch on, meaning a whole lot more gift baskets and a huge surge for Martha Stewart, something which can only benefit the struggling magazine and gift basket industries.”
Willie Nelson was the first major celebrity to take advantage of the system. He eventually fell afoul of the system and had to repay years of taxes after his album sales plummeted.
“That is really where people find themselves in trouble with the law. They tend to forget about the requirements, some of which are ongoing, and just start to take it easy. It’s a lot easier to do that because of the money savings but they have to diligent and keep working or they are going to have similar problems,” continued Kearns. “It’s a tough thing for many of them especially with such a hefty bank account but life isn’t always fair. Even celebrities have to make an effort, unfortunately.”
The IRS has a similar system for the ultra-wealthy but in their case the system actually gives back money to the claimant.
Samantha Dryden, Entertainment Correspondent
NEWS > ENTERTAINMENT > CELEBRITIES FINALLY REALIZE THEY DON’T NEED TO PAY TAXES
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