Yeezy Apparel Racks Up Nearly $1 Million Tax Bill

Meghan Hall
·5 min read
3

Wake up, Mr. West—California wants around $1 million from you and Yeezy.

Yeezy Apparel LLC, owned by Ye, the rapper and controversy-courting celebrity formerly known as Kanye West, has four outstanding tax liens in California, one of which dates back to 2021.

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These outstanding bills mean Yeezy Apparel owes California $934,033.56.

Receiving a tax lien means an individual or entity has tax debt it has refused to pay. A company or individual can be issued a tax lien by the Internal Revenue Service (IRS) or by a state government. In this case, each of Yeezy Apparel’s liens came from California’s Employment Development Department (EDD).

The first notice arrived in July 2021. After failing to pay $8,866.30 in taxes, Yeezy Apparel incurred a penalty of $4,681.85 and interest amounting to $451.13, bringing its outstanding debt to $13,999.28.

Though that may not be a large chunk of change for someone with Ye’s status and bank account, the problems only worsened in the past two years.

In February 2022, California forked over a notice for an additional $279,085.99 in cash owed. Ye’s brand, which previously had collaborations with Adidas, Balenciaga and Gap, had failed to pay $186,080.72 in taxes, which triggered an $85,810.33 penalty and $7,194.94 in interest.

In September 2022, Yeezy Apparel received a third notice of state tax lien, this time stating it owed an additional $319,356.58. Per state records, the “Donda” artist’s brand had refused to pay $212,648.40, which resulted in a $97,063 penalty and $9,644.40 in interest.

The latest blow came in March last year, when California dropped another $319,356.58 state tax lien on Yeezy. That came from the company’s failure to pay $212,648.40 in taxes, which instigated a $97,063.78 penalty and $9,644.40 in interest.

But Richard Gano, a tax lawyer with Holtz, Slavett & Drabkin and former IRS attorney, said that the presence of the liens on Yeezy’s records may not mean the company hasn’t paid part of its balance.

“When I look at these liens, they don’t tell us what the current balance is,” he told Sourcing Journal.

That’s because California doesn’t remove liens from a company or individual’s record until they have been paid in full. Gano said a company can pay a lien outright or hammer out a payment plan. But even if Yeezy and Ye have chipped away at some of their tax obligations, that is not reflected until it has been paid in full.

And if Yeezy hasn’t paid anything toward its balance, it has accrued more interest since the liens were first filed.

Upon looking at the liens, Alexandra Eaker Pérez, a tax attorney at Eaker Pérez Law in San Diego, said the issues that resulted in the liens being filed were likely due to payroll taxes. Gano and Nicholas Rozansky, a partner at Stubbs, Alderton & Markles in Sherman Oaks, Calif., agreed.

Eaker Pérez said Yeezy likely had a number of chances to pay the outstanding taxes or work with the EDD prior to a lien being filed against it.

“The state doesn’t file a tax lien until a tax is final, due and payable, and that’s after lots of notices and lots of appeal rights have all gone out and lapsed,” she said.

The California EDD declined to comment on the liens against Yeezy Apparel.

Despite the company’s tax troubles, it continued with business as usual last year. The polarizing brand opened a new headquarters in California and was looking to hire interns to staff that office.

Rozansky said it’s not unusual that a business would stay the course while it’s saddled with tax liens.

However, he said, refusing to quickly settle those liens can be a tough look when trying to find lenders and partners.

“It’s an indication that things are not going well in some way, shape or form, for you or for your business, and as a result lenders are going to look at them very seriously,” he told Sourcing Journal.

Individuals can be held personally responsible for outstanding business liens in some cases, Eaker Pérez said.

Aside from Yeezy’s tax woes, Ye has personal liens out against him for failing to pay property taxes. The Daily Mail uncovered documents that show Ye tried to “Runaway” from paying taxes on his properties in Calabasas, Calif. Per the documents, the “Vultures” rapper owes $101,093 total in property taxes for a mansion and an apartment nearly 30 miles northwest of Los Angeles.

Ye has never been averse to attention—but tax liens could be just the kind to sink his reputation where money and loans are concerned.

Gano said tax liens effectively act as a scarlet letter for future business considerations, until these debts have been paid in full.

“[Liens] put the world on notice, and and they put creditors and other businesses that want to do business with Yeezy… on alert. This matters because if Yeezy wants to get funding or deal with lenders, when they see these liens, it does raise flags to them, in terms of their [creditworthiness], whether or not they want to business with them,” Gano said.

Yeezy could not be reached for comment.