Kevin Hart recalls being in “double debt” after spending most of the $250,000 he received from a development deal.
While speaking with Grant Cardone on “Power Players,” he says he spent the load of cash when he was 21 years old. With a lack of financial education at the time, he then found himself in a pickle when Uncle Sam came knocking.
“The first lump sum of money that I got, I remember I was like 21 and I got $250,000 as a development deal,” he told Cardone. “Nobody explained taxes to me. Nobody explained an entity, an LLC. The money just came, they took some of it out. I spent it and looked up and owed more money to the government and had to pay that, was left with a negative balance and was left with a hell of a marker of money that had to be paid.”
What’s more, Hart worked to pay off the debt over time, and he ended up owing twice as much in taxes.
“I was in debt for like two years trying to figure out how to pay the money that I owed to the government,” he continued. “So the money that I was making as a standup, I still had to pay the taxes on that money. So I ended up being in double debt ’cause this money is being used to pay the government from what I owed them up here. And I’m not able to pay the taxes from that money from what I owed right here. So, holy sh-t, I’m three years behind. What the f-ck is happening?”
“When that happened I said, ‘When I get out of this situation that happened, which I eventually will, I’m never coming back to it again. I’m gonna get the information that I should have had,'” Hart told Cardone. “I talked to people who had money. I was in some rooms with people that were making money, and I asked questions that some people think they are too cool to ask.”
He added, “My penalty for not asking questions when I made money was f-cking off the money and owing. The benefit was now putting myself in a position to try to not make the same mistake.”