NEW YORK (MainStreet) Every year we hear of celebrities that are in millions of dollars of debt, spending tons of money on frivolous items, or possibly even going bankrupt. It really makes a person wonder what these wealthy entertainment icons are using their money for when they declare bankruptcy after being worth so much. Granted, one can assume that these stars are not frequenting Dollar Mart or purchasing their clothes at Goodwill, but if they can afford to spend thousands on a single outfit, why are they in tax debt that's quadruple the amount of that outfit? This, unfortunately, is a question to which the rest of the world may never know the answer. Tax evasion is among just a few of the worst celebrity financial mistakes of 2013. This category also contains career-threatening slips of the tongue, unpaid bills for cosmetic procedures and bank fraud. Read on for more.
1. Paula Deen. Perhaps the most career-altering mistake made this year, Deen's admittance to using a racial slur during an interview ruined her reputation. The episode caused the Food Network to sever ties with the chef, after 11 years of work together. The celebrity chef's cookware line and all other available products related to her brand were also removed from the shelves at stores such as Target, Walmart, Sears, and JC Penney, just to name a few. Smithfield ham company and casino giant Caesars Entertainment were also among the others who backed out. The charges against Deen were ultimately dropped after, of course, her reputation was slammed to the ground.
2. Janice Dickinson. Most recently a judge on four seasons of "America's Next Top Model" and a host to her own reality show called "The Janice Dickinson Modeling Agency," Dickinson spent the '70s and '80s modeling in the big leagues. Well-known in the fashion industry, Dickinson apparently wanted to keep up her reputation with staying beautiful, so much so that it caused her to file for bankruptcy this year. Her obvious obsession with cosmetic procedures has now helped her to fall down the rabbit hole and into debt by almost $1 million. The New York Postsays that Dickinson owes approximately $16,000 total to two dermatology and plastic surgery specialists, as well as over $500,000 to the states of New York, California, and the IRS. Dickinson appears remorseful about the money she owes and plans to pay it back.
3. Teresa and Joe Giudice. The "Real Housewives of New Jersey" stars are now facing the possibility of more than 50 years in prison for 41 counts of fraud, eOnline reports. They were most recently indicted on November 18 for two more counts of bank and loan application fraud, in addition to the 39 counts that were alleged against them in July. Previous counts of fraud include mail and wire fraud and bankruptcy fraud. If convicted on any of these charges, Joe Giudice will also be facing possible deportation to Italy, as he is not a citizen of the United States. The couple continues to plead not guilty, and there is a trial date set in February 2014 that will take place in federal court.
4. Lauryn Hill. On May 6 of this year, singer Lauryn Hill was sentenced to three months in prison and an additional three months in home confinement for tax evasion. According to People, Hill told the judge that she had "always meant to eventually pay the taxes, but was unable to during a period of time when [she] dropped out of the music business." She also added in that she "needed to be able to pay her taxes without compromising the welfare of her children." Between the time of her success in the 1990s and now, Hill has done well with remaining outside of the public eye. She has been living in New Jersey, raising her six children, five of which she had with Bob Marley's son, Rohan Marley. The prison sentence came when she reached about $1 million in earnings on which taxes were never paid. Hill has since been released from jail, and has also recently released a new single, "Consumerism."
5. Jessica Hart. The 27-year-old Australian model generated a lot of hate and anger from Taylor Swift fans after she stated during an interview that she felt Swift "didn't fit" at this year's Victoria's Secret fashion show. Although rumors circulated that Victoria's Secret fired the model over her comments, US Magazine confirmed that it did not, in fact, come to that. Hart spoke with US shortly afterwards and explained that she thinks that Swift is a "true rock star" and that she "could never get up there and do what she does!" Although Hart still continues to model, she has lost a lot of fan respect, especially from Taylor Swift's fanbase. That can take a financial toll.
--Written by Ciara Larkin for MainStreet