Iggy Azalea Owes $400,000 to the IRS. See 3 Possible Tax Debt Penalties She Could Be Facing

Iggy Azalea

by Harry Galstian

May 11, 2016

Lately there’s been a lot of attention on Iggy Azalea and her terrifying $400,000 tax debt. And let’s face it, the IRS is probably one of the scariest entities to be indebted to. Other than a looming tax bill, what other consequences could Iggy (or someone like her) face?

1. Restrictions on Travel

Luckily for Iggy, she’s got an Australian passport. For U.S. citizens owing over $50,000, traveling may not come so easily. With the new IRS passport law, individuals with this sizeable debt (and that includes fees and penalties) will now find themselves unable to travel using their passports. And this won’t just affect international visits. Thanks to non-compliance with the controversial Real ID Act, citizens living in Minnesota, New Hampshire, New York, and Louisiana may soon be unable to travel domestically without an approved passport.

2. A Tax Lien

One of the biggest tax debt penalties concerns tax liens. A standard tax lien lasts for 10 years and can be extended if the IRS chooses. Tax liens will lower credit scores and prevent real estate closings. They are also on public record, so they can possibly threaten employment opportunities and be a general embarrassment to your reputation. Iggy’s fame may make it easier to deal with the credit, employment, and real estate side of the equation, but, if you follow the celeb on Twitter, the embarrassment of such a giant lien is still pretty evident.

3. Lots of Fees

Iggy is currently paying her debt in installments. If she ends up failing to pay, she may face another one of the big tax debt penalties: giant fees. In fact, if Iggy fails to pay, she could end up owing thousands of dollars a month in late payment fees. It might temporarily feel less stressful to ignore your tax debt, but just as with so many things in life, the problem will simply compound.

So how does someone like Iggy Azalea end up owing $400,000 to the IRS?

While she may be high-profile (and highly paid), Iggy’s story is similar to many people in the U.S. who find themselves in debt to the IRS. Like any self-employed individual, she may not have known exactly when her next check would come or how much she would end up owing, so she didn’t hold anything back. It could also be that Iggy didn’t have the necessary financial counsel to advise her on what to spend, what to save, and what she’d owe. One thing is for sure, her mistakes are something any of us could make.

Have you found yourself overwhelmed by tax debt? Are you living in fear of these tax debt penalties? Don’t bury your head in the sand. Instead, contact Direct Tax Relief for IRS tax resolution services at 1-877-505-4829.


  • https://www.nydailynews.com/entertainment/gossip/iggy-azalea-hit-hefty-tax-lien-article-1.2587669
  • https://www.forbes.com/sites/robertwood/2016/04/05/iggy-azaleas-400000-irs-tax-lien-dims-10-carat-ring-but-irs-cant-revoke-her-passport/?sh=66df32a32c57