Taxation & Estate Planning

Odyssey Struggles to Pay Tax Debt

By Darrin Mish

Odyssey Dance Theater (ODT) is encumbered with more than $700,000 in back taxes, interests and penalties since the mid-2000s. This was partially due to confusion over ODT?s tax number and misleading tax advice received by the dance company, which has since been corrected, according to ODT artistic director, Derryl Yeager.

Earlier this year, the dance company paid $247,000 to the IRS as settlement which the company hopes will be accepted by the IRS. Now begins the waiting as such a response from the IRS could take anywhere from two months to two years.

ODT does receive funding from some state agencies like the Salt Lake County Zoo, Arts and Parks that contributed $60,000 last week, a grant that comes from county taxes in 2010. ODT?s annual expenses come up to about $1.3 million. Between 1997 and 2009, a total of $889,384.98 was received by ODT was received by ODT from the Salt Lake County Zoo, Arts and Parks (ZAP) for running costs, conducting dance camps and for expansion purposes. The ZAP administrator Victoria Panella Bourns has explained the state agency?s continued support for ODT despite its federal debts.

According to ZAP, the dance company plays an important role in the development of arts in the city. Furthermore, they are taking steps to pay off their tax debts through ticket sales of their performances rather than through borrowings.

Of late, the ODT?s annual performances of ?Thriller? has been a huge success, with two ODT companies performing to packed audiences in Salt Lake City, Ogden, Provo, Park City and Tuacahn Ampitheater near St. George. The ?Thriller? performances for ODT are likened to the money-generating ?Nutcracker? performances for other dance companies.

ODT?s tax debts stemmed from their inability to fulfill their tax obligations in their early years when ?the money just wasn?t there,? according to Yeager. The company had to make a decision whether to pay their dancers or pay the IRS. They chose their dancers. ?(The tax problem) was always something we were going to take care of when things got better,? said Yeager.

ODT has been listed in ZAP?s list of companies with failing financial health and along with 9 other companies that receive ZAP funding, now need to provide financial health plans and regular reports to ZAP.

Yeager reiterates that ODT?s financial ill-health is solely due to its tax debts, which are being addressed at present. The company has been current in its tax obligations for the last 6 years.

Odyssey Struggles to Pay Tax Debt is a post from: IRS Tax Problem Solver Blog - IRS Help

Full post as published by IRS Problem Solver Blog on October 09, 2010 (boomark / email).