Travolta Owes the Tax Man

ByABC News
November 30, 2000, 8:15 PM

November 30 -- George W. Bush isn't the only one accusing people of using fuzzy math. The Internal Revenue Service has settled a dispute with Battlefield Earth star John Travolta, who must pay $607,400 in back taxes.

According to court records obtained by the Los Angeles Times, the 46-year-old actor has agreed to pay disputed losses he claimed from 1993 to 1995. The IRS sought more than $1 million, but Travolta will pay only back taxes, not the nearly $500,000 in penalties.

Talk about some unlucky numbers: The feds took issue with Travolta's claim that he had $2.27 million in unspecified losses for a company called ATLO Inc. According to the Times, ATLO is an "S corporation," a token business the rich often employ as a tax break.

The IRS took issue with the actor, who makes an average of $20 million per picture, stating that Travolta's reported losses were improper. The government bureau also disputed his claim of $50,000 in unspecified itemized deductions in 1994 and 1995.

Neither the IRS nor Travolta's attorney would comment for the Times report. The paper stated that it's rare for a celebrity's tax problems to see the light of day, since most are settled early. Travolta appealed the dispute in tax court last year.

Travolta is a high-profile member of the Church of Scientology, a controversial organization that has long lobbied to do away with the IRS, Inside.com notes.