Nick Diaz' Tax Confession

MMA fighter Nick Diaz needs to just keep his mouth shut on so many different levels.

Most of the time it is his barely inteligible taunting and trash-talking of his opponents (which he hasn’t always been able to back up in the octagon) that tarnishes his reputation.  But his most recent “foot-in-mouth” incident has to do with his taxes of all things.  In the press conference following his loss to UFC welterweight champion, Georges St-Pierre, on Saturday, Diaz said “I’ve never paid taxes in my life and I’ll probably go to jail.”

Diaz said that he didn’t want to make excuses, but I think that’s exactly what he’s doing bringing up his tax problems in such a setting.  It was completely out of context.  The message he is trying to send is that his personal life is such a mess that it’s impacting his performance during fights.  His manager, Cesar Gracie, said that Diaz misspoke and that he’s paid over $100,000 in taxes over the past two years.  But I’m not sure which version of reality is more disturbing, that he didn’t pay and his manager is trying to cover for him, or that he did pay but has such a loose grip on his personal obligations that he didn’t know about it or didn’t remember paying it.

Tax attorney and Forbes contributor, Robert Wood, pointed out that there are a few different levels of culpability when it comes to tax crimes, and at this point we aren’t sure which (if any) describes the situation of Nick Diaz.  Here is a very basic outline from most egregious to least egregious:

  1. Filing a false tax return
  2. Failing to file a tax return
  3. Filing an accurate return, but failing to pay the tax due

I’m less sympathetic when it comes to celebrity tax problems (and the IRS feels the same)because it’s usually a “can pay, but won’t” scenario as opposed to the ordinary Joe who simply can’t pay.

Nobody should be surprized if it turns out that Diaz hasn’t filed.  If he can’t take personal responsibility for getting himself to important events on time (or at all) then he certainly isn’t responsible enough to manage his finances.  Diaz desperately needs to hire a tax accountant, and possibly a tax attorney.

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