Mr. Snipes got very lucky I think - the jury's decision is back and he was found not guilty of fraud, but his two co-defendants face up to 10 years in prison; Blade just owes back taxes.
Here's the newspaper article.
Still, he is going to have to pay quite a bit. If you round up the $58 million to $60 and assume he earned it equally over 2002 to 2004 he would owe $7 million in tax for each year. Throwing in failure to file and failure to pay penalties adds another 100% to each year. Kind of harsh, I know, but the minimum penalty when returns are more than 6 months late is $100 or 100% of the tax due when both of these penalties apply.
There is also a fraud penalty that can be assessed that adds another 75%, but Blade managed to get out of this one.
So, what we have so far is $7 million in tax and $7 million in penalties for each year so far. Now we add in interest - I'm going to make it easy and say that he only owes 5%, simple interest and that it's going to take him until April to pay (I said I was going to make it easy, didn't I?). At 5% per year that adds $350,000 in interest for each year the tax hasn't been paid.
Blades 2002 return was due in April 2003 which means that he would owe interest for 5 years or $1.8 million. For the 2003 tax return he owes one year less or $1.4 million and for 2004 he only owes $1.1 million in interest.
What all this means is that my estimate of what he will need to pay is:
2002 $15.8
2003 $15.4
2004 $15.1
Total due $46.3 million!
Hmm, better start on Blade IV real quick! And file your tax return this time.
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3 comments:
So, do you think he was smart enough to invest all of the money such that what he earned in interest out performed all of his late penalties, etc?
Naw, he can't be that smart.
Yeah, I kind of doubt that he invested the money wisely based on the advisors that were tried with him. The investment advice probably wasn't much better.
Great work.
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