Tuesday, August 26, 2008

Ruben Studdard's Taxes Go Off-Key

2003 American Idol champion Ruben Studdard faces liens in regard to nearly $200,000 in regard to tax deficiencies with the IRS and the state of Alabama. Most of the tax deficiency resulted from a recording contract (valued at $1,000,000) for winning the popular Fox reality show. The liens place at risk a nightclub Studdard plans to open in his hometown of Birmingham. In a related development, Australian tax authorities are now scruntinizing Paul Hogan's tax returns (see link at
  • Aussie Authorities
  • ).

    This sad story indicates that reality shows should provide tax advice to winners (and in the case of American Idol, even a number of runner-ups). The change in earnings frequently is dramatic and the contestant often is unaware of the tax implications.


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