Dionne Warwick Files for Bankruptcy
The Grammy-winning singer reportedly owed more than $1 million and blames a former business manager for mismanaging her affairs.
Dionne Warwick has filed for Chapter Seven bankruptcy over tax liens dating to the 1990s.
Rolling Stone reports that the five-time Grammy winner, 72, filed on March 21, ending a lengthy relationship with the IRS that reportedly began with an inept business manager.
“Ms. Warwick had a business manager who mismanaged her affairs,” her attorney Daniel Stolz told Rolling Stone. “Before she knew it, she owed a gazillion dollars in taxes. She’s actually paid more than the face amount of the taxes, but with all of the crazy interest and penalties that they add, the number kept mushrooming -- even though she paid off the amount that she owed in terms of the actual taxes.”
Warwick’s financial issues have resurfaced multiple times during the past 15 years, though the manager in question was fired several years ago. According to Stolz, the singer filed taxes annually and was unable to come to an agreement with the IRS despite several attempts. At one point, the IRS allegedly lost Warwick’s file for several years. In 2012, the performer’s name could be found on a 2012 list of the Top 500 people and businesses owing significant unpaid taxes in the state of California.
Stolz maintains that Warwick continued to pay over the years, but that her money was only applied to penalties and interest, not the principal amount. He estimates that Warwick has paid nearly $1.3 million over the years -- which is more than her actual lien. (In 2009, the IRS said Warwick owed $1 million.)
“Just because someone is a well-known, prominent celebrity doesn’t mean they’re conversant in their financial affairs,” said Stolz. “They rely heavily on people and frequently wind up waking up someday saying, ‘Geez, how did I get in this mess and how do I get out of it?’ ”
Warwick, a first cousin of the late Whitney Houston, filed for bankruptcy in New Jersey and completed the credit counseling required by the court. She recently wrapped a string of tour dates in New York and New Jersey but does not perform often enough to pay the growing tax bill. According to her bankruptcy petition, Warwick’s average income is $20,950 per month with $20,940 in expenses.
Warwick scored a dozen top 10 singles from 1963 to 1985. Her career was fueled by a long association with songwriters Burt Bacharach and Hal David, scoring hits with such songs by the pair as "Walk on By" and "I Say a Little Prayers. Her 56 charted singles on the Billboard Hot 100 ties Warwick with Madonna for the third-most of any female singer behind Aretha Franklin (73) and Taylor Swift (58).
Warwick's first No. 1 single -- 1974's "Then Came You," for which she teamed with The Spinners -- came a dozen years after her first hit. And her biggest success came 11 years after that with "That What Friends Are For," her 1985 collaboration with Elton John, Stevie Wonder and Gladys Knight as Dionne & Friends. It won the song of the year Grammy for writers Bacharach and Carole Bayer Sager.