Some of Pacquiao's guaranteed $20 million may go to IRS

LAS VEGAS -- Manny Pacquiao is guaranteed $20 million for his fight against Timothy Bradley on Saturday night, but a chunk of that might be going toward settling Pacquiao's tax problems with the Internal Revenue Service.

Pacquiao's finances are under audit by the IRS, and also by the Bureau of Internal Revenue in the Philippines, in which some reports have him owing as much as $50 million in back taxes.

Pacquiao's advisor, Michael Koncz, says Pacquiao's financial situation in the Philippines might be more politics than anything.

"In America, there's no issue of tax evasion or nothing," Koncz said this week. "The major issues here are about four categories of tax deductions. We have a tremendous accounting team working for us. We have great tax lawyers working for us."

Koncz said Pacquiao's tax attorneys have a plan in place since he has been under audit, "and it's going exactly the way we want.

"We'll let the tax appeals court decide. And that's all it is here is four categories of tax deductions that we believe are true tax deductions that the IRS says are possibly not."

Koncz said there is no doubt Pacquiao will owe money.

"I estimate that we're going to owe a few million when this is over, but that's not a shock to us.

"Is it going to be the $18 million that somebody put out there? Absolutely not."

Koncz is among several of those close to Pacquiao who say the boxer's generosity with his fellow Filipinos is a concern.

"At some point it scares me, because I believe that Manny's downfall is going to be his kindness and generosity," Koncz said. "Nothing wrong with giving to the people. But first you take care of yourself, take care of the future of your family, then give it away after that.

"But the problem (me and Manny) have to figure out – and I blame myself, too – there's a fine line between helping people and people taking advantage of your generosity. That's where Manny has to understand that you can help this guy because this guy's got nothing, but what about this (other) guy? He's got everything. That's the issue I've got."