Why Jermaine Dupri Is A Great Example of Financial Mishaps…

Jermaine Dupri is under some financial strains. Dupri started off owing the state of Georgia more than $493,000 in back taxes for 2007. Also, he owes $14,000 in unpaid property taxes on a home in Fayette County. Even his mansion was to be foreclosed on. Yet, the auction was stopped at the last minute. To add insult to injury, he has missed his child support payments for his youngest daughter. It is safe to say that Dupri somehow managed not to pay people.

The biggest concern is this: how did all of this manage to happen?

The reason why this is confusing is because he is a producer and not an artist. Producers are known to get percentage points of whatever an album sells. Also, there is always the consideration that producers don’t have to worry about recouping costs. Recouping Costs are costs that are incurred because the record company has to earn its money back from what was spent on the album [1]. After those costs are recouped, then the artists can earn their percentage points. Unless a producer is producing an album for themselves, they don’t have to worry about those costs. In turn, producers usually tend to make their money without worrying about if the album is a success or not.

So, a multi-platinum producer all of a sudden has financial issues and there is little known as to why?

Interesting enough…

At this point, one can only use the evidence and draw a conclusion. From what is seen, Jermaine Dupri created a lifestyle that he may have some trouble sustaining. Either that or he has become irresponsible at paying his bills.

To start, having issues with the IRS tends to happen to musicians. Most musicians should always have a bookkeeper and an accountant to make sure that money is accounted for and taxes are paid on the income [2]. This is especially true for artists who have a tendency to do plenty of touring and have to take note of their road earnings. Many musicians have to realize that, for better or for worse, they are “businesses” within themselves. All businesses need to keep their income accounted for. The taxes have to be paid. Extensively, bookkeeping and accounting practices are ways to not worry about IRS issues.

Another concern is Dupri’s recent work output.

To shoot frank, he hasn’t been doing much of anything. Back in 2006, he did production for Dem Franchize Boyz, Avant, Isley Brothers, Monica, Jagged Edge, Donnell Jones, Chingy, 3LW, Daz Dillinger, and Bow Wow. However, his production output and placement on albums has dried up. In 2009 and 2010, he lent his production talents to Fabolous, Bow Wow, Hot Dollar, Nelly, Monica, Usher, and Mariah’s Christmas album. Only one of those albums went platinum (Usher) and another one went gold (Monica). Fabolous may eventually go gold, but that won’t be anytime soon. And the rest of those albums?? I wouldn’t even worry about the sales they have produced. Plus, his production on most of those albums was limited to a placement or two. Conclusively, his production output has staggered.

Even still, with a lack of production and album sales for the artists Dupri works with, there is still a consideration of cash flow inputs and outputs. There is no real confirmation of what he spends and what he still consistently brings in. What can be understood is that he is accustomed to a lifestyle. Having millions of dollars bring about millionaire habits. Once that money is lessened, a person is still left with their old habits, bills, and debts. In the end, it remains to be seen what Dupri’s money is actually doing.

There is plenty for the average person to learn from this situation. For one, a person should make sure taxes are paid. Another lesson is to live either within his/her means.  Better yet, how many will make sure they live below their means? It is unfortunate to learn lessons from another’s hardship. Still, Dupri showed all of us how important it is to take care of their finances.

Article by Mark Harris, contributing writer for STACKS Magazine

Sources 1 & 2 ; Photo Source