“Real Housewives of Atlanta” original cast member NeNe Leakes has been hit with a federal tax lien worth close to a cool million dollars. According to documents filed in a Georgia court, Leakes, whose real name is Linnethia Monique Leakes, owes $830,000 in back taxes.
The lien is focused on the tax year 2014, which was a very good year for Leakes. In addition to her “Real Housewives” stint, Leakes launched a clothing line, The NeNe Leakes Collection, for the Home Shopping Network (HSN) that year (the collection sold out days after launch). Leakes also took a turn on the dance floor with dance pro Tony Dovolani on ABC’s “Dancing With The Stars” (she was voted off in week 7).
Leakes didn’t offer any reason why she didn’t pay but appeared to take the lien in stride, posting a photo on her Instagram account with a Chanel bag and the caption:
Running out the hotel to pay this bill y’all know I ain’t got no jobsssssss let me borrow 20$ #unstoppableNene #oversight #shaneinthebacktripping
She followed up on Twitter tweeting to her 1.89 million followers:
4 all those that r asking, reporting & concern…Yes I am broke & unemployed. Just another dumb Celeb that doesn’t know how 2 money manage
And suggesting they might want to start a GoFundMe account:
My priorities r all screwed up! I’m just a damn fool out here about to lose my house! Please start a Go Fund Me
All jokes aside, if Leakes doesn’t pay up, the Internal Revenue Service (IRS) could take additional steps to collect on the debt. Even if Leakes starts paying her bill, the lien could stick around for a bit: you can be liened even if you’re on a payment plan.
The purpose of a tax lien is to protect the government’s interest in your property, including your real estate and personal property. To file a lien, the IRS must first assess your tax liability and send you a bill. If you don’t pay the bill in full, the IRS can file a Notice of Federal Tax Lien which puts creditors on notice that the government has a legal right to your property. This is important because the government often has a priority claim: the lien lets creditors know that they may not be first in line if you don’t pay up on other debts. What this does, realistically, is affect your ability to get credit. If and when you sell any of your assets, you may be forced to turn over the proceeds to the IRS to satisfy your debt.
If you pay your tax liability in full, the IRS will release the lien. The IRS may also work with you to release the lien under other circumstances, including efforts to demonstrate compliance while you’re on a payment plan (facts and circumstances matter here and, as I mentioned earlier, the IRS does not have to withdraw a lien while you’re on a payment plan). Filing for bankruptcy doesn’t necessarily help you out: a federal tax lien may continue even after you’ve filed for bankruptcy.
Don’t confuse a lien with a levy: they’re not the same thing. A lien acts as a placeholder. A levy means that the government is taking action to actually seize your property to pay your tax debt. That means that Leakes’ relatively new 9,511 square foot Sugarloaf mansion is likely safe – so long as she eventually gets current on her taxes.
Leakes wouldn’t be the first of the “Real Housewives” to face Uncle Sam.
In August of last year, “Real Housewives of Atlanta” star Kim Fields (let’s face it, she’s Tootie from the “Facts of Life” to you and me) was issued a federal lien after accruing $212,000 in federal taxes for the tax years 2011, 2012, and 2013. Her co-star, Sheree Whitfield, was hit with a tax lien for more than $100,000 in December 2013.
And, of course, “Real Housewives of New Jersey” star Teresa Giudice spent time in federal prison after she and her husband, Joe, pleaded guilty to charges in a bankruptcy fraud and tax evasion case. Giudice was released from prison in December of last year, just before Joe began his 41-month sentence.