Aaron Carter, who achieved fame as a singer in the late 1990s and early 2000s, filed for Chapter 7 bankruptcy in Florida in October 2013. In his petition, he lists assets of just over $8,000 and debts of more than $2 million. More than half of the debts, including a seven-figure amount owed to the Internal Revenue Service, date back to when Carter, now twenty-five years old, was a minor. Much of his fame and fortune accrued before his eighteenth birthday, but he is liable for tax on that income regardless of age.
Carter’s music career began before he was even a teenager. His older brother, Nick Carter, was a member of the popular “boy band” the Backstreet Boys. Carter opened shows for the group and toured on his own. He acted in movies and on stage, and his family was featured on a reality television show several years ago. He is currently touring in support of a comeback, but the performances are reportedly not bringing in enough money to pay his debts.
The majority of his outstanding debts were incurred when he was a minor, and his relationships with the people managing his career did not always turn out well. He filed for legal emancipation from his mother, who was also his manager, in 2003, claiming that she was working him too hard and mismanaging his income. He was also managed by Lou Pearlman, who created and managed numerous “boy bands.” Pearlman is currently serving a sentence in federal prison for fraud, and has been the subject of multiple lawsuits by former clients, including two lawsuits filed by Carter in 2002 and 2007. Continue reading