Taxation & Estate Planning

Two IRS Debtors that might Raise Eyebrows

By Darrin Mish

Here is the story of two individuals who owe tax money to the government. One or both of the stories may irk you, surprise you, interest you or it might not bother you at all, but both are true. The first has to do with the proposed mosque to be built at ground zero in New York City. Whether you agree with the project or not, you may be interested to know that the builder of the 15 storey Ground Zero Mosque and community center, Sharif El-Gamal owes the IRS back property taxes on the exact property the mosque is supposed to be constructed on.

The amount owed by El-Gamal is $224, 270.77 after his company failed to pay the IRS its taxes in January and July this year. This information is sure to become talk fodder for political talk shows around the country.

The owner of the property on which the mosque is to be built is Con Edison but they have leased half of it to El-Gamal. Therefore, El-Gamal is responsible for the project located two blocks away from where the World Trade Center buildings stood just nine years ago.

According to the lease agreement between El-Gamal and Con Edison, El-Gamal is responsible for paying taxes on the entire property. This means that El-Gamal?s failure to settle his taxes would constitute a breach of the contract. However, El-Gamal?s company, 45 Park Place Partners contends that the taxes have indeed been paid.

The other individual in trouble with the IRS over unpaid taxes is rapper Young Buck. Two days after a recent raid by the IRS on the rapper?s home, Young Buck, whose real name is David Darnell Brown, voluntarily filed for Chapter 13 bankruptcy. According to bankruptcy records, he did this to control how creditors would be paid.

In the raid, the IRS confiscated tens of thousands of dollars worth of personal belongings that included jewelry, furniture, music awards and recording equipment. Filing Chapter 13 might eventually save all the confiscated items because this provision of the bankruptcy law allows debtors to settle their debts over a period of time up to 5 years without interest.

Under the terms of the bankruptcy filing, Brown agrees to have his recording label Cashville Records deduct $12,500 a month for 60 months out of his salary of $19,170 to pay for his outstanding taxes. But the rapper is free to keep his additional earnings including royalty payments.

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Two IRS Debtors that might Raise Eyebrows is a post from: IRS Tax Problem Solver Blog - IRS Help

Full post as published by IRS Problem Solver Blog on September 07, 2010 (boomark / email).