Mediaboss Marketing

Al Sharpton is in the news again but this time its not about civil rights but government liens. At a press conference in his Harlem office today, Sharpton lashed out at a New York Times article reporting that, together with his for profit companies, he was the subject of $4.5 million in federal and state tax liens.

Sharpton called the report misleading and totally out of context.

Sharptons tax troubles first made news in 2008 when the Internal Revenue Service (IRS) filed personal liens against Sharpton totaling nearly $1 million. At that time, he also owed nearly $365,558 to the City of New York for unpaid personal income tax and his for-profit company, Rev. Al Communications, owed the state of New York $175,962 in delinquent taxes.

And that wasnt all: about that same time, an investigation was ordered into finances of Sharptons nonprofit group, National Action Network. The group did not deny inaccuracies with respect to reporting and they did agree that they had failed to file timely tax returns as required. Charlie King, the acting executive director for National Action Network, blamed the groups success for their troubles, saying that the organization was not prepared for the sizable increases in donations and income; those donors at the time included Anheuser-Busch, which gave more than $100,000 in 2007, and politicians such as former New York Gov. David Paterson (D-NY), Rep. Charles Rangel (D-NY), and New York Governor Andrew Cuomo (D-NY).

National Action Network kept up with the growth by paying bills using payroll tax money: in other words, money that was collected from employees to be submitted, along with an employer contribution, to the tax authorities. Since that money isnt simply owed but collected on behalf of third parties to be remitted as tax authorities, payroll taxes are often referred to as trust fund taxes (you may have heard that term as it applies to sales taxes for the same reasons). Trust fund taxes are generally not dischargeable and grow, together with interest, until they are paid off.

The New York Times reported that the total amount that National Action Network owed was just under a million in 2003 but ballooned to almost $1.9 million by 2006. By 2009, more than a $1 million still remained outstanding at a time that Sharpton was picking up a $250,000 paycheck from the group.

Sharpton has maintained that the tax debt was not willful and said today that the group was making an effort to pay. The outstanding balance as of last December, according to Sharpton, includes over $400,000 in penalties.

The Rev. Al Sharpton speaks during a news conference, Wednesday, Nov. 19, 2014, in New York. Sharpton spoke about his plans for thepending grand jury decisions in the deaths of Michael Brown in a St. Louis suburb and Eric Garner in New York and also addressed tax allegations in a New York Times story. (AP Photo/Julie Jacobson)

Nonprofit organizations are not allowed to be owned by an individual or group of individuals which may explain why that figure was not included in the New York Times $4.5 million tally. That number was calculated separately with claims that Sharpton has individual liens for $3 million in federal taxes and $777,657 in state taxes. Sharptons for profit companies, Raw Talent and Revals Communications, reflect a combined $717,329 in liens for state and federal taxes. The total is a whopping $4.5 million, a total that Sharpton denies, calling the amount absolutely inaccurate. However, he was unable (or unwilling, your call) to provide the amount he actually owed.

For a savvy business man who claims hes been able to reach from the streets to the suites, Sharpton appeared to illustrate a shocking misunderstanding of the tax system, telling reporters:

Continue reading here:
Al Sharpton Denounces Claims He Owes Millions In Taxes To IRS, New York