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Ja Rule admits cheating IRS out of $1.1 million

Photo Credit: Cliffview Pilot

Rapper Ja Rule could go to prison for three years but likely will be fined after admitting in federal court in Newark today that he ducked $1.1 million in federal income taxes on nearly $4.4 million in royalties and live performance payments over five years.

Jeffrey “Ja Rule” Atkins

U.S. Magistrate Judge Patty Shwartz allowed 35-year-old Jeffrey Atkins, who lives in the tony Bergen community of Saddle River, to remain free on $500,000 bail pending a scheduled June 13 sentencing.

This gives him time to finish work on his new “Renaissance Project.”

Atkins already has agreed to spend two years behind bars after pleading guilty in December to an attempted weapon possession charge in New York. The judge in that case postponed the sentencing date until June 8 after Atkins’ lawyer said his client needed to resolve “a tax problem.”

The attorney noted that it would also allow Atkins to complete his latest album — scheduled to drop June 7, according to a widely disseminated tweet from the rapper.

As part of a deal with federal prosecutors in New Jersey, Atkins pleaded guilty to ducking pay taxes on more than $3 million in income earned between 2004 and 2006, and agreed to make good on the money he owes the government.

All told, Atkins — the sole shareholder of ASJA Inc. and Rule Tours Inc — admitted that he collected royalties from one and tour payments from another from 2004 through 2008 . The first year he made roughly $1 million, followed by a breakout 2005, in which earned $1.59 million, court records show.

His career’s been on the downslide ever since. Rule’s earnings took a hit in 2006, to $760,000, followed by $540,000 in 2007, before bottoming out at $490,000 the following year.

“Each of us must pay our fair share to keep this country moving,” U.S. Attorney Paul J. Fishman said.

Fishman credited special agents with the IRS Criminal Investigation unit. Assistant U.S. Attorney Joseph Mack of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark brokered the plea agreement.

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