Mike Tyson Has Heavyweight Tax Problems | AccountingWEB

Mike Tyson Has Heavyweight Tax Problems

By Teresa Ambord

When twenty-year-old Mike Tyson was named heavyweight champion back in 1986, he was the youngest man ever to win that title. They called him "the baddest man on the planet." He retired with a 50-6 record (44 knockouts), earning him a place in the International Boxing Hall of Fame and the World Boxing Hall of Fame. After that he appeared in some TV shows and movies (including The Hangover franchise). Over the course of his career, he made more than $300 million. But in 2003, he declared bankruptcy. 
According to Tyson, very little of his wealth remains, and what there is belongs to the IRS. A decade after filing bankruptcy, that process is still not settled, and Tyson and his current wife owe a bundle – an unspecified bundle – in back taxes.
Tyson is currently on tour with his one-man play, Mike Tyson: Undisputed Truth, where he takes the audience through his tumultuous story. On March 19, HBO will air an interview that's a sample of what Tyson has to say in the play. 
A Bumpy Road
Chances are, Tyson's life didn't turn out the way he expected. Multiple marriages, the first of which was to actress Robin Givens – not exactly a match made in heaven. In that divorce, Tyson gave up a large chunk of his wealth to Givens, who drew heavy criticism from people who saw her as a gold digger. Then Tyson faced a rape charge brought by a beauty pageant contestant in Indiana, for which he did three years in prison. In 1997, he incurred public scorn when, in a boxing match with Evander Holyfield, he bit off part of Holyfield's ear. As noted earlier, in 2003, he filed bankruptcy and is still under the weight of that filing. In 2009, his four-year-old daughter died in an accident at home. Now Tyson and his current wife, Lakiha, are millions of dollars in debt to the IRS, though they won't be more specific than that. 

Welterweight Nick Diaz: "Never Paid Taxes"

Nick Diaz made an unusual confession that he will regret. On Saturday March 16, he lost to opponent, Georges St-Pierre at a match in Montreal. In an interview after the fight, he told reporters . . . and any IRS agents listening, "I can't be jumping teams. I just have to invest a little bit more, now that I have a little bit more money," Diaz said. "You know what? I've never paid taxes in my life. I'm probably going to go to jail."

Diaz had met some tough opponents before, but he'll likely meet his match with the Tax Man. Now that he's let the tax cat out of the bag, he's about to find out what a real fight is. Right about now he might be asking, "Ooops . . . did I say that out loud?"
Management Issues
Not many athletes have a story as vivid as Tyson's, but stories of celebrities earning and squandering their fortunes are becoming quite common. In February 2013, Tyson filed suit in Los Angeles Superior Court against his former financial planner, Brian Ourand, and SFX Financial Advisory Management Enterprises (Ourand's former employer). 
SFX is known and respected for representing celebrities. For a long time, the Tysons were happy with their association with the firm and Ourand. They considered Ourand a friend, even inviting him to their wedding. They trusted him to write checks out of their account. Then out of the blue, they discovered he had been replaced and was no longer with the firm. Someone else was handling their money. When they questioned SFX about Ourand's departure, they were told he had stolen $300,000 from their accounts. 
SFX did send the Tysons financial compensation; however, the couple said it was insufficient to cover what had been taken and claimed Ourand hadn't just taken cash, but had also caused them financial damages of around $5 million. That's the basis of their lawsuit.
When they initially engaged SFX , the Tysons wanted help concluding their 2003 bankruptcy that had dragged on. Tyson said the unfinished bankruptcy caused him to be capped in what he could earn and forced him to bypass significant economic opportunities. SFX and Ourand were supposed to help wrap up the loose ends so Tyson could move on with his financial life.
According to the complaint they filed, "By April of 2011, the Tysons were growing increasingly frustrated with the pace of the bankruptcy proceeding. Income that the Tysons were permitted to retain was inexplicably not being used by SFX to effectuate a closure of the bankruptcy." The complaint also alleges that as Ourand was embezzling their funds, he was also misleading their attorneys about the progress of the bankruptcy, causing the accumulation of hundreds of thousands of dollars in wasted legal fees. 
What's Tyson Doing Now?
Besides fighting his former advisors in court, Tyson is on a thirty-six-city North American tour of his one-man autobiographical show entitled Mike Tyson: The Undisputed Truth directed by Spike Lee. Tyson talks about the play and about his life in an interview that airs March 19 on HBO Real Sports. He describes his rise and fall in his public and private life. 
The HBO interview is called "The Transformation of Tyson" and is hosted by Bernard Goldberg. Goldberg asked Tyson if the play is how he intends to make a living at this point in his life. Tyson answered, ". . . that belongs to the IRS. All that money goes right to them. I don't see none of it." He went on to say, "I'll never be wealthy again. That's a wrap. That's history. That's never gonna happen again."
As sad as that sounds for a man who was once on top of the world, the truth is, some people aren't cut out to be wealthy. Tyson's best days may be ahead of him, without the wealth. 
Read more celebrity news stories.
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