How could one of Hollywood's highest paid actors find himself owing $6.3 million in back taxes and deep in money troubles? The answer is, "Easy," if you believe Nicolas Cage.
In a lawsuit filed Oct. 16 in Los Angeles, the National Treasure star, 45, claims that his longtime business manager, Samuel J. Levin, "lined his [own] pockets with several million dollars in business management fees while sending Cage down a path toward financial ruin."
That journey began in 2001 when Cage – whose next movie is the crime drama Bad Lieutenant: Port of Call New Orleans – hired Levin to oversee his investments and finances. Levin did not return calls seeking comment. A rep for Cage had no comment.
On The Market
Though Cage claims it was only recently that he learned the gravity of his financial condition, the actor started selling off some of his prized possessions months ago. In April, Cage bid farewell to his Bavarian castle, selling it to his German advisor, lawyer Konrad Wilfurth.
Now, he has placed other homes on the market in California, Las Vegas and New Orleans, where two of his residences – each worth at about $3.5 million – are up for auction Nov. 12, according to the that city's Times-Picayune. Regions Bank foreclosed on Hancock Park Real Estate Co., the owner of Cage's properties, for $5.5 million in unpaid mortgage debts, the newspaper reported.
Tax Trouble
Cage's home liquidation comes as the U.S. government has placed a tax lien on his real-estate holdings because of $6 million in unpaid taxes dating from 2007, according to court papers. In addition, the Internal Revenue Service has another lien for more than $350,000 in unpaid taxes dating from 2002 to 2004.
East West Bank also filed a breach-of-contract complaint in Los Angeles Superior Court that claims Cage had failed to repay a $2 million loan that was extended this past August.
In the lawsuit filed against his business manager, Cage says he "relied on Levin to handle his financial affairs to ensure that he and his family would have a financially secure future built on the foundation of the substantial monies Cage earned through years of hard work."
"He is now forced to sell major assets and investments at a significant loss and is faced with huge tax liabilities because of Levin's incompetence, misrepresentations and recklessness," the lawsuit alleges.(Interestingly, Cage sold off his rare comic-book collection for more than $1.6 million in 2002, a year after hiring Levin.)
Now as the actor gets ready to hit the big screen again this fall, he faces "catastrophic losses" of more than $20 million, according to his lawsuit. His next court hearing is scheduled for February 2010.
National treasure? More like national liability.
Just a week after word broke that Nicolas Cage has defaulted on a $2 million loan comes news that Uncle Sam is now among those bringing the hammer down on the, last we checked, rather prolific actor.
Over the summer, the IRS quietly placed a tax lien of nearly $6.26 million on Cage's New Orleans properties after the actor flat-out failed to pay income taxes in 2007 (the same year, incidentally, that he raked in some serious back-end profits from Ghost Rider and National Treasure: Book of Secrets).
As if that weren't bad enough, the IRS obtained a second lien over yet more unpaid taxes, this time for income earned between 2002 and 2004. That lien, as the New Orleans Times-Picayune first reported back in August, was for an additional $360,545.84.
Not surprisingly, Cage put two of his properties on the market this spring and was forced to sell off one of his many castles. The recession hits hard, folks. Still, where's Jerry Bruckheimer when you really need him?
Maybe Wesley Snipes could have a word, one cash-strapped action star to another?
