The Biggest Celebrity IRS Audits

The IRS had imposed tax liens on rapper Lil Wayne, born Dwayne Carter Jr., dating back to 2002, before he settled his tax debt, estimated at $14 million, in 2019. IRS tax liens cover all property, even property acquired after the lien filing. Tax liens hurt one’s credit and reputation.

Country music superstar Willie Nelson had well-publicized tax problems in the 1990s. The IRS seized much of his property to help pay off the $32 million debt. It is believed Nelson’s debt bill occurred because his accountant put his money in bogus tax shelters. Nelson reached a settlement with the IRS and paid off the debt. Nelson recorded the album “The IRS Tapes: Who’ll Buy My Memories” to help pay the tax bill.

Telecommunications mogul and space travel entrepreneur Walter Anderson received a nine-year prison sentence in 2007 for evading more than $200 million in federal taxes by creating offshore accounts to his income. A federal judge then ruled that an error in the government’s plea agreement with Anderson invalidated the conviction, though he was still required to pay about $23 million in taxes to the District of Columbia.

Attorney Paul Daugerdas holds the dubious distinction of having committed the biggest tax fraud ever. He received a 15-year jail term after he was convicted of creating bogus tax shelters for his wealthy clients so they could avoid paying taxes. The fraudulent shelters were designed to create phony losses so the rich could reduce their tax bills.