After several failed negotiations, Chris Tucker has reached a settlement with the IRS, a move that will support the actor in managing his tax debt.
According to reports from “Hollywood Reporter,” Tucker will need to pay off $3.6 million to cover unpaid income tax to the federal government for 2002, 2006, 2008, and 2010.
A Look At Tucker’s Tax Debacle
Tucker, who is reportedly worth $5 million, has been disputing his income tax liabilities since 2010. In March, the IRS was pursuing $9.68 million from Tucker in unpaid taxes, but has been unable to reach a repayment agreement.
This is not the first tax agreement that Tucker has had to reach with the IRS.
In 2011, after he did not repay the $2 million settlement, the IRS agreed to accept installment payments as Tucker was selling one of his properties. Three years later, in 2014, the IRS placed a lien on one of his properties and Tucker was able to repay the $14 million tax debt. Tucker’s team attributed the debt to “poor accounting and business management.”
Yet Tucker was still challenged with managing his tax liabilities. The IRS demanded that Tucker sell his assets to manage those liabilities. The IRS believed that Tucker had “sufficient equity and cash to fully pay the taxes” while Tucker’s representatives argued that he had requested “for the IRS to keep an open mind about reaching a resolution for Mr. Tucker’s unpaid tax liabilities.”
Ultimately, Tucker and the IRS agreed on installment payments between $25,000 and $50,000 over a 10-year period, according to reports retrieved by Hollywood Reporter. Court documents show that Tucker made payments of at least $38,000 monthly from 2017 to 2019, the year he reportedly stopped making payments.
How Did Tucker Mismanage His Finances?
Tucker, who starred in films such as “Friday,” “Jackie Brown,” and the “Rush Hour” franchise was once one of the most sought-after and highest-paid Black actors in Hollywood. For the “Rush Hour” franchise, he was paid $3 million, $20 million and finally $25 million for his role, according to Hollywood Reporter.
Representatives for Tucker have attributed his tax liabilities and inability to repay to the issue of poor financial management throughout his career. In 2011, for instance, Tucker admitted that he was having trouble paying his bills.
When Tucker’s IRS dispute began, he was approaching foreclosure on a mansion in Florida, according to Celebrity Net Worth. Tucker purchased the home for $6 million in 2007. Initially, the property was listed for $2 million in 2010. The property finally sold in 2012 for $1.7 million — a $4.3 million loss.
By 2013, Tucker was selling his home in Tarzana, California, for $2.1 million. He purchased the home in 1996 for $1.1 million.