Holla, Holla...Ja Rule faces the tax music

By Ken Berry

A self-proclaimed rap "gangsta" is going to jail for committing a white-collar crime: tax evasion. Multi-platinum selling artist Ja Rule (whose real name is Jeffrey Adkins) has been sentenced to 28 months in federal prison for failing to report more than $3 million in earnings from 2004 through 2006. Just one month earlier, the rapper and sometimes actor was sentenced to up to two years in state prison in New York on a concealed weapons charge.

Ja Rule has freely admitted he didn't even file tax returns for a five-year stretch. The charges relating to the other two years were dismissed in the plea bargaining deal, but he's still on the hook to the Internal Revenue Service for the other three years and $1.1 million in back taxes.

The IRS continues to target entertainers, industry leaders, and others among the rich and famous as a means of increasing voluntary tax compliance. Last year actor Wesley Snipes began serving a three-year term stemming from three counts of willful failure to file tax returns for 1999 through 2001. Previously, hotelier Leone Helmsley, the notorious Queen of Mean, was sentenced to four years in prison and socked with a $7.1 million fine on top of a tax bill of approximately $1.7 million. Helmsley was famously quoted as saying, "Only the little people pay taxes."

During the last decade, Ja Rule cranked out numerous hit recordings like "Holla, Holla" and "It's Murda," as well collaborations with more mainstream artists like Jennifer Lopez and Ashanti.  He has appeared in a dozen films ranging from his role as a street racer in the "Fast and the Furious" to lighter fare like "The Cookout" with Queen Latifah. He has also engaged in well-publicized feuds with rappers Eminem, 50 Cent, and DMX.

Minutes before his sentencing, the gangster rapper proclaimed his innocence and chalked up the tax problems to bad advice. "I in no way attempted to deceive the government or do anything illegal," Ja Rule said, according to the New York Post . "I was a young man who made a lot of money -- I'm getting a little choked up -- I didn't know how to deal with these finances, and I didn't have people to guide me, so I made mistakes."

The time that Ja Rule spends in jail on the weapons bust can count against the time he must serve in federal prison for the tax evasion charges. If his state sentence is reduced to 18 months for good behavior, he could get out after serving an extra ten months.

Related articles:

You may like these other stories...

Camp Hopes Estate Tax Will Be on Its Way OutAn article in Bloomberg said that Republicans are considering voting this year to repeal the U.S. estate tax, according to House Ways and Means Chairman Dave Camp (R.-Mich.). He...
Senate Takes Different Approach from House for Highway and Bridge FundEarlier this week, according to a New York Times article, the Senate agreed to fill the coffers of the fund that pays for highway and bridge repairs with...
There it stands, your client's 100-year-old, rickety, vermin-infested barn or former hotel or whatever the darn thing once was. And she's considering what to do with it. There are two words that can help her decide...

Upcoming CPE Webinars

Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.