Juan Pablo Montoya is facing a large fine and back taxes after the IRS calls him on what they call a sham.
Juan Pablo Montoya is in a bit of a pickle.
The Internal Revenue Service (IRS) is demanding $2.7 million in taxes and penalties after they determined that his income in 2007 and 2008 was much higher than Montoya and his family filed.
As many high profile athletes and corporations do, they find loopholes and tax havens worldwide to protect their assets.
Having moved from Monaco to the United States in 2007 for his stock car career, Montoya and his tax attorneys completed multiple transactions of funds from one Bahamian corporation set up as a business that marketed and profited off of his name, likeness, and bio, to another corporation with the same purpose, based out of Delaware.
Delaware is a popular destination as it does not tax intellectual property, such as Montoya’s Monty Motorsport LLC.
The IRS now views the tax deductions that Monty Motorsports is using from its purchase from Montoya’s Bahamian business as a sham, as it uses that sale against his earning, deferring a large amount of taxes during those years.
Much of the allegations surround the time of the sale, which was in 2006, before Montoya was a US citizen.
More on this story as it become available.