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LOS ANGELES, CA – JULY 13: Singer Beyonce performs on the Staples Middle on July 13, 2009 in Los … [+]
Entertainer and enterprise success Beyoncé Knowles-Carter—identified to followers as Beyoncé or Queen Bey—has filed a petition in U.S. Tax Court docket contesting almost $2.7 million in tax and penalties. The April 17, 2023, petition asks the court docket to rethink further tax and penalties assessed by the IRS in a January 18, 2023, Discover of Deficiency.
Quantities Alleged Due
The Discover of Deficiency alleges that $805,850.00 in further tax, along with $161,170 in penalty, is owed for 2018, and $1,442,747.00 in further tax, along with $288,549.40 in penalty is owed for 2019. There may be additionally curiosity due on these quantities.
Knowles-Carter disputes the deficiency, claiming, amongst different issues, that the IRS erred in disallowing tens of millions of {dollars}’ price of deductions, together with $868,766 attributable to a charitable contribution carryover reported in 2018.
Additionally at challenge? These penalties. The IRS assessed part 6662(a) penalties—accuracy-related penalties. By statute, these penalties are 20% of the quantity of the underpayment of tax. Nevertheless, Knowles-Carter argues in her petition that if any tax is due, the penalties mustn’t apply as a result of she “has acted moderately and in good religion.”
Beyoncé
Knowles-Carter is among the most well-known faces on this planet. She debuted her first solo album, Dangerously in Love, in 2003. Twenty years later, she turned the most-winning artist within the historical past of the Grammys, bringing her haul to 32. She was additionally named one of many 100 Most Influential Folks—within the Titan class—by Time.
Knowles-Carter filed the Tax Court docket petition as the only taxpayer. Her husband, Sean Carter—often known as Jay-Z—was not included within the submitting. Carter, hip-hop’s first billionaire, is listed on Forbes’ billionaire listing at #1274, with an estimated web price of $2.5 billion. He was one in every of Forbes’ Highest Paid Entertainers in 2022.
It is commonplace for high-earning married taxpayers to file their taxes individually. California, the place the Carters reside in keeping with Knowles-Carter’s tax return, has the added complication of being a group property state. When submitting a separate return within the Golden State, every partner studies one-half of group earnings plus their particular person earnings.
Tax Court docket Process
The Discover of Deficiency is what triggered the petition. A taxpayer has 90 days (150 days for taxpayers exterior of the nation) from the date of the discover to file a petition with the Tax Court docket to problem the tax. The Tax Court docket has the authority to listen to different tax issues, too, together with requests for abatement of curiosity, assessment of some collections actions, and willpower of employee classification.
A Tax Court docket motion begins with the submitting of a petition. A submitting payment should accompany the petition—that is at the moment $60. As soon as the petition has been filed, a taxpayer sometimes will not need to pay the underlying tax till the case has been determined.
Circumstances are scheduled for trial as quickly as doable. Do not count on a televised trial à la Gwyneth Paltrow’s ski go well with. Most Tax Court docket circumstances are settled by settlement with out going to trial. But when a matter goes to trial, it is often a comparatively quiet affair in entrance of a single choose—there is no jury.
Whereas taxpayers might signify themselves in Tax Court docket, Knowles-Carter is represented by Michael C. Cohen of De Castro, West, Chodorow, Mendler & Glickfeld, Inc. A request for remark from Cohen was not instantly returned.
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