As you and many that are reading this are probably well aware, it’s currently tax season. And for many of us, that means doing our yearly ritual of finding and gathering receipts, purchasing accounting and book-keeping software, seeking the knowledge of qualified tax professionals, and so on. We do it because we have to by law, and because we want that all-important refund (those of us that still get it, that is). But one of the things I’ve noticed this year is a larger-than-normal number of Hip Hop artists, reported in the news at least, that are feeling the squeeze on past monies owed to good ole’ Uncle Sam.
Let’s be clear: tax problems and music artists are nothing new. Nor is the sentiment that financial literacy isn’t quite paramount in the Hip Hop community. But some of the big profile names in Hip Hop that are currently feeling the wrath of the U.S. Governments’ forced hand include Lil’ Kim, who is reported on popular music website HipHopDX.com to own the IRS over $1 million in taxes that were not paid in 2008 and 2009 (you can read the story on Kim right here), and Nas, also in a reported on HipHopDX.com, to own the IRS a total of $6 million in back taxes, with a tax lien having been served to the legendary Queens emcee to the tune of over $330,000 (peep Nas’ story right here.)
There was even an article in the December/January issue of XXL Magazine that outlined some of the struggles that rappers such as former G-Unit representative Young Buck are having, including his filing for Chapter 11 bankruptcy, and maybe even having to go the route of Chapter 7 bankruptcy and having all of his assets, or those that he has left, liquidated. That same article was reported to have reached out to the camps of several high-profile emcees in the industry today that, over the years, have made their respective record labels millions of dollars through CD and digital single sales, merchandise deals, television and movie appearances, and the like, to get an idea of whether they were in a good financial place.
And apparently, not a single one of these artists or a representative from their camp was willing to that, which, if you think about it, brings the term “no snitching” to a whole new level. Check out an excerpt of the story by clicking here.
In any industry, with any job or career path, and in any instance where there’s money to be made, financial literacy is tantamount. But the importance becomes all the more greater when we talk about the music and entertainment industries, and bigger still when we talk about Hip Hop, because the sad fact is, there are very few artists that are visible and relevant that actually ARE willing to talk about getting their money right.
There seems to be a vicious cycle, a prevailing theme and a sense of hypocrisy within Hip Hop that continues to give the impression that as an artist, you have to flash your wares every chance you get, but when it comes to handling everyday financial challenges, be it income taxes, knowing the changes to tax laws and tax codes, determining an annual salary, staying on top of monthly bills, paying employees, label contracts, investments, estate planning, or what have you. Again, financial literacy is of great concern for any person on any job.
And no matter how we divide the pie, at the end of the day, even if you are a successful artist in today’s industry, you essentially have a job and are building what is hopefully a sustainable career. With any job, you have to do some necessary hard and non-sexy work to ensure that you will be comfortable financially, or at least have trustworthy, experienced people on your team doing this for you and making certain that they keep you abreast of the dealing of your money. Because Heaven knows nobody else is going to do all of these things for you.
Financial literacy and knowledge are too important to ignore for any artist in any genre these days. But too many times, it seems that Hip Hop artists of all ages and generations come up short and lacking in this area, taking an ill-advised “wait-and-see” approach to their money, and because of the way the music industry is structured, are really never able to recover from simple mistakes that grow into bigger ones when left untreated. There have been many a music career that has been placed on indefinite hold due to the lack of a basic understanding not just of what money an artist is getting and where it is coming from, but there it is eventually going and how to generate more of it with that which one already has. Especially at this time of year, artists (especially those in Hip Hop) must begin to show more in the way of gaining the knowledge, and therefore power, over their own finances and what steps they can take to ensure more money down the line.
So what do you think? Know of any artist that could use these resources? Are you an artist looking to gain more power over your financial future? Are you an entertainment business person with more knowledge and advice to offer than me? If so, share your story here! And feel free to share this with friends, colleagues and family. Thanks!