Busted

So far, every for-profit enterprise started by Al Sharpton and known to National Review Online has been shut down in at least one jurisdiction for failure to pay taxes, a review of public records in New York and Delaware reveals.

Records show that Sharpton’s beleaguered for-profit entities often overlap and intertwine, some sharing ties with the reverend’s nonprofit organization, National Action Network. Their financial records are copious, confusing, and sometimes outright bizarre, and together, they depict persistent financial woes for Sharpton, who also personally owes New York State nearly $596,000, according to active tax warrants.

“He clearly appears–based on the information that’s available to us–to have a history of noncompliance with tax obligations,” says Bernadette Schopfer, the director of taxation at New York’s Maier Markey & Justice, a certified public-accounting firm that has had no dealings with Sharpton or National Action Network. “It appears that [Sharpton] does not file [taxes for his businesses], and then opens up something else. At all the entities we see he has opened up, he has not been compliant with the obligations of the owner of a business. . . . He’s either willful in his behavior, or he’s just sloppy.”

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Sharpton’s first for-profit company, Raw Talent, probably has the strangest set of tax-debt records. The company was incorporated as a for-profit entity in 1991, the same year Sharpton founded National Action Network.

Raw Talent racked up a lot of tax debt. According to a 2007 lien that appears to remain active, the company owed a total of $580,453 in federal taxes, and state records say it also owes $4,834 in New York taxes.

For some reason, the federal lien says the taxes owed are for the tax period ending in 1950–long before Raw Talent was incorporated. (Perhaps this is a clerical error, Schopfer says.) The kind of tax debt listed is also strange: It’s listed under the code 4720, which signifies an excise tax on charities, even though Raw Talent was registered as a for-profit entity, not a philanthropic nonprofit. A spokesperson for the Internal Revenue Service could not explain this to NRO, saying privacy laws prohibit the agency from commenting on the tax situations of specific individuals or entities.

New York dissolved Raw Talent in 2002 for failure to pay taxes, but not before Sharpton opened up a new company, Revals Communications, in 1999.

Revals Communications has its own set of oddities. For starters, various records show it shared Battery Park Place and Broadway office addresses with the soon-to-be defunct Raw Talent.

From the very beginning, Revals Communications ran into tax problems. The records indicate the company either failed to file or failed to pay taxes from 1999 to 2002.

The tax debt started off slowly, at $10,585 in total for the first three years. But in 2002, the same year Raw Talent dissolved, Revals Communications’ unpaid balance ballooned by an additional $215,606. Meanwhile, a 2007 New York tax warrant shows Revals Communications also owed the state $175,962. New York finally dissolved the company in 2009.

Before that, though, the reverend founded yet another for-profit entity, Sharpton Media Group. Unlike the other companies, he originally registered Sharpton Media Group in Delaware, a state where corporations don’t need to disclose much.

Sharpton then registered the company in New York as a foreign limited-liability company in July 2004, three months after it opened in Delaware. In 2007, Delaware dissolved it for failure to file tax records. At the time, an entity report from Delaware says, Sharpton Media Group owed $7,001 in taxes. But records show the entity remains active in New York.

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Money from Sharpton Media Group ended up at National Action Network, even though charitable watchdogs say a loan from a company owned by a nonprofit’s leader raises significant red flags and can constitute a conflict of interest. The nonprofit’s tax filings show balances due of $19,174 in 2010; $53,144 in 2011; and $47,302 in 2012.

In 2005, a little more than a year after opening up Sharpton Media Group, the reverend also incorporated a company called Bo Spanky in New York. {snip}

Like Sharpton Media Group, Bo Spanky loaned money to National Action Network; the nonprofit’s tax filings list balances due to Bo Spanky of $187,078 in 2010; $58,079 in 2011; and $87,079 in 2012.

NRO could find no federal tax liens filed against Bo Spanky. But a $1,645 tax debt to the state proved the company’s undoing, and it was dissolved in 2012 for failure to pay.

On National Action Network’s latest tax filing, from 2013, loans from Bo Spanky and Sharpton Media Group disappear, apparently replaced by a loan directly from the reverend himself, with a balance due to Sharpton of $328,881.

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A National Action Network spokeswoman said Sharpton has reached a settlement with both state and local tax authorities on his financial records, though the New York Times reported in November that “his balance with the state, at least, has actually grown in recent years.”

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