Celebrities and other famous people have been taking advantage of the federal bankruptcy laws for centuries, many of whom may never have been suspected by the average American. For instance, Abraham Lincoln, Mark Twain, Ulysses S. Grant, Larry King, Donald Trump, Burt Reynolds, and Toni Braxton have all filed some form of bankruptcy. Some of the most famous, and surprising celebrity bankruptcies of the past few decades include:
- Michael Jackson – Despite being classified as the most successful entertainer of all times (according to the Guinness Book of World Records), the late, great superstar filed for bankruptcy in 2007. This was due mostly to the astronomical cost of maintaining Neverland Ranch in Santa Barbara County, which housed a zoo, an amusement park, a movie theater, a fire department, a helicopter pad, and a railroad line. Michael Jackson, who purchased the home in 1988 for $17 million, invested $10 million a year in upkeep, and also borrowed $25 million against the estate, which he could not afford to pay back, forcing him into bankruptcy.
- 50 Cent – Rapper/actor 50 Cent strategically filed for Chapter 11 bankruptcy recently after being served with a $5 million lawsuit. Though there are rumors that the artist, born Curtis Jackson, is worth an estimated $155 million, according to his lawyers he is only worth approximately $4.4 million, explaining why filing bankruptcy was necessary.
- Wayne Newton – This long-time Vegas performing soprano soloist was a child entertainer who had accumulated a wealth of success. However, in 1992 the singing celebrity filed Chapter 11 bankruptcy, owing over $20 million to creditors. Filing helped him reorganize his assets, and he was reportedly making as much as $250,000 a week, post Chapter 11 status.
- MC Hammer – This dancing rapper filed for Chapter 11 bankruptcy in 1996, after amassing a $30 million fortune by the early ’90s from musical hits such as “U Can’t Touch This.” The loss of his wealth was partly due to staffing over 200 people to manage his $12 million mansion, and carrying a 40-plus entourage on a daily basis. The bankruptcy filing was fueled by a couple of copyright infringement claims.
- Willie Nelson – Known as the bad boy of American country music, Nelson grew very popular in the ’60s, ’70s, and even through the ’80s. He thought he was protecting his assets by placing them under a tax shelter, but the IRS would eventually deem it illegal. He lost most of his assets, including his Texas ranch, in order to satisfy a $16.7 million tax debt. This would force him into filing for bankruptcy. In the ’90s, he released a compilation album titled “The IRS Tapes: Who’ll Buy My Memories?” of which a portion of the proceeds went to the federal government to help satisfy his enormous tax bill.
Anyone can mismanage their finances and make poor investments, regardless of how much money was earned in the past. When there have been millions lost by well-known citizens in the country, there is no reason to be embarrassed to file for bankruptcy, especially if it is the best option for economic survival. DCDM Law Group will advise and assist you on what to expect when filing for bankruptcy, as well as how to file for bankruptcy. If your finances have gotten out of control and trying to manage them has taken a toll on your resources, and perhaps leading to emotional exhausting, DCDM Law Group will help you balance your life and prepare all documents necessary to file for bankruptcy, so you may begin to gain financial peace.