Last week, Business Insider released a report highlighting the enormous paychecks some of the nation’s favorite TV personalities receive. Although the numbers are huge, and will stay very large even after tax contributions, it’s important to remember that their net pay is actually much lower than the amount you see in the article.
Celebrities are sometimes paid in very odd time increments, for things that require special attention from a tax payer’s perspective. The average worker gets a paycheck over regular intervals, and has the same withholdings every time. Celebrities, however, may receive their income in various amounts and ways throughout the year and in several formats. They receive royalties, advances, large lump sums, and even get paid to wear a specific designer, or attend a certain music festival. All of these different types of incomes must be reported, and must have taxes paid on them.
The various ways celebrities get paid may be why we see so many of them in trouble with the IRS. Not only are celebrities constantly in the public eye, their income taxes are usually so high, the penalties for not paying are much more serious than the penalties an average American would face.
No matter how large your gross pay is, the calculators on PaycheckCity can give you an accurate take-home pay. You can use the calculators whenever you have a major life change, for example a child, a pay raise, or a new job.
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These free resources should not be taken as tax or legal advice. Content provided is intended as general information. Tax regulations and laws change and the impact of laws can vary. Consult a tax advisor, CPA or lawyer for guidance on your specific situation.