According to People Magazine, Hollywood Actor Nicolas Cage, star of such mega-hits as ‘National Treasure’ and ‘Con Air’, has had a tax lien placed on his real estate holdings by the IRS. Why? He owes the IRS $6.3 million in back taxes from 2007. In addition, according to India’s The Economic Times, Nicolas Cage is also being sued by East West Bank for the $2 million he borrowed from them and didn’t pay back. Cage, one of Hollywood’s highest paid actors, has sold several real estate properties in the last couple of years, possibly in an attempt to pay back debts. But does Nicolas Cage have other properties to sell, can he pay off his bad debts or is he going bankrupt?
Cage, in fact, buys more property than many other Hollywood movie stars put together. He has purchased real estate in California, Nevada, Louisiana and Rhode Island, and still owns most of it. He’s also well known for buying other real estate property all over Europe including an 11th century German castle called Schloss Neidstein, which he also recently sold.
Most of the time, Cage doesn’t live in the real estate he buys. He simply spends money renovating it, until it looks incredible, and then turns around and sells it. Usually making a profit of a few hundred thousand or a few million dollars.
At the moment, Nicolas Cage has property in California, Nevada and Louisiana on the market, with a value of several million dollars. But, as the IRS now has a tax lien on his property, what will this mean for Cage?
A federal tax lien, first of all, means if any of Cage’s property is sold, the IRS will collect some of the money that is due to them. So, if Nicolas Cage manages to sell two or three of his real estate properties, his debt to the IRS would likely be paid. However, although a lien sounds like it’s not that serious, in reality it could be very serious for someone like Nicolas Cage. A lien goes on your credit rating and tells creditors you are not a good risk if you want to borrow money.
For Nicolas Cage, a world-famous Hollywood actor, just by having a lien placed on his real estate property, he has made international news. Which means, anyone he goes to for credit for another real estate purchase or underwriting for a future movie is likely to think twice about lending Cage money, without even needing to look at his credit rating.
With a tax lien and now a lawsuit on his personal record, things aren’t looking good for Nicolas Cage financially. While there’s no evidence he’s going bankrupt, Cage is obviously having financial problems. The IRS will probably get their money first, then it will be the bank’s turn. Looks like Nicolas Cage might want to be doing a few quick real estate deals, to get both these entities off his back.
The Economic Times – Nicolas Cage sued for $2 million
Luxist – Nicolas Cage Sells One, Many More to Go, Estate of the Day