December 28, 2018
Photo by Jon Pack/NBC/NBCU Photo Bank via Getty Images, Sam Tabone/Getty Images
It’s the end of the year and the government is coming to collect everything that’s owed to it, especially if your names are Aretha Franklin and Dionne Warwick. The two legendary singers owe the government large amounts of money, and it’s not looking pretty.
The Queen of Soul reportedly left $8 million worth of tax debt when she passed away in August, which has now fallen on her estate to pay. Her tab breaks down to more than $6.3 million in back taxes from 2012-2018 and an additional $1.5 million in penalties. Franklin’s estate claims they’ve already paid $3 million in back taxes since her death.
The songwriter’s attorney, David Bennett told the Associated Press the IRS has it all wrong when it comes to the number Aretha should pay: “We have disputes with the IRS regarding what they claim was income. We claim it’s double-dipping income because they don’t understand how the business works.”
He also added, like most musicians, the “Respect” singer had travel expenses that needed to be taken care of: “She had to pay for transportation, hotel rooms, backup singers, musicians. When she did that the IRS was questioning the returns she filed. We’re going through audits. Returns were filed as timely as we could get them filed.”
Hopefully, this all can get resolved soon and all will be well with Aretha’s estate. But as for her former adversary Ms. Warwick, she, too, is in hot water with Uncle Sam.
In 2013, Warwick filed for bankruptcy with $25,500 in assets and liabilities in the amount of $10,727,429. Majority of her debt was reportedly tax-related, owing $6,964,466.87 to the government. The case was extended for years after the “Walk on By” singer sued the government. She sought out a court order dismissing her almost $7 million tax debt from 1990-2008 and for a judge to block the IRS from seizing her assets.
At one point during the case, the singer accused the IRS of violating this court order when they tried to take her assets over alleged unpaid taxes from 2011-2012 totaling $71,408. The government responded by stating they only discovered the $71k owed because she failed to report all her income.
A trial date is set for March 6 in New Jersey where Dionne and the IRS will go head-to-head in this years-long tax battle. The court has opened up four days on the calendar specifically for this case.
TELL US: Do you think both Aretha’s estate and Dionne will bounce back from these tax woes?