Comedian Russell Peters, seen here hosting the Juno awards show in 2017, was hit with reassessments totalling more than US$2-million over California residency claims.Sean Kilpatrick/The Canadian Press
Brampton, Ont.-born standup comedian Russell Peters has launched a lawsuit against two of his long-time Canadian tax advisors after he was found liable for more than US$2-million in backdated California income taxes.
The Canadian comic was hit with reassessments totalling more than US$2.1-million, plus interest, for the 2012, 2013 and 2014 tax years. California’s Franchise Tax Board (FTB) concluded he was actually a resident of that state in the subject years rather than a resident of Nevada, as Mr. Peters had claimed.
But in a statement of claim filed with the Ontario Superior Court of Justice in December, 2025, Mr. Peters blames Toronto area chartered professional accountants Fred Levy and Mark Feigenbaum for his U.S. tax woes.
Mr. Peters’ claim seeks a total of $6-million in damages against Mr. Levy, Mr. Feigenbaum and their respective professional corporations, alleging they were negligent and in breach of their contractual and fiduciary duties to him in their handling of his initial California tax filings, as well as the subsequent audit and appeals processes.
“At all material times, the Defendants had complete access to the financial, accounting, and personal records necessary to determine Mr. Peters’ U.S. residency, including, without limitation, his California property ownership, travel patterns, vehicle leases and time he spent in California, from which his true residency status would have been readily ascertainable by competent accounting and tax professionals,” the claim reads.
Peter Smiley, a partner at Toronto law firm Berkow Youd Lev-Farrell Das Smiley LLP, is acting for Mr. Peters in the Ontario action.
“When it comes to his personal tax liabilities, Mr. Peters relies entirely on the advice of others,” Mr. Smiley stated in an email to The Globe and Mail. “Mr. Peters always understood that he had paid the taxes that he owed.”
None of the allegations in the statement of claim has been proven in court.
Mr. Feigenbaum, and Mr. Levy’s lawyer, said in statements sent by e-mail to The Globe that they will not be commenting on the litigation as the matter is before the courts.
Comedian was advised to establish residency in Nevada
According to Mr. Peters’ statement of claim, the standup comic first retained Mr. Levy’s entertainment industry-focused firm to handle his accounting and tax affairs in 2005.
After initially moving to Los Angeles to further his comedy career in 2006, Mr. Peters says Mr. Levy advised him to buy a home in Nevada, with the aim of establishing residency in that state, which has no personal income taxes.
The claim says Mr. Levy added Mr. Feigenbaum – a dual-qualified accountant and lawyer licensed to practise in both Canada and the U.S. – to his team in 2008, and the pair were then jointly responsible for Mr. Peters’ cross-border tax and accounting affairs. From 2008 to 2014, they prepared and filed California non-resident income tax returns for Mr. Peters.
However, in his Ontario claim, Mr. Peters says that by 2012, “the centre of his personal and family life had shifted from Nevada to California,” adding that between 2012 and 2014, he resided primarily in the Golden State while he was not touring to be close to his daughter’s home there after his separation from the child’s mother.
The FTB started its audit in 2016 and delivered its verdict on Mr. Peters’ California residency in 2017, kickstarting a years-long protest and appeal process, during which Mr. Peters claims Mr. Levy and Mr. Feigenbaum repeatedly assured him “the filings were accurate, that the FTB’s position was unfounded and that the matter would be resolved in his favour.”
Mr. Peters hired a new business management and accounting firm to handle his financial affairs in 2023 before severing his relationship with Mr. Levy and Mr. Feigenbaum the following year.
However, it was only when California’s Office of Tax Appeals (OTA) issued its own endorsement of the FTB assessments in July 2025 that Mr. Peters realized he may have a case against his former advisors, according to his Ontario claim.
The OTA, in its ruling, rejected Mr. Peters’ challenge of the FTB’s use of credit card information showing he had spent at least 113 days in California for each of the subject years, compared with no more than 21 days each year in Nevada.
“While [Mr. Peters] did maintain a Nevada driver’s license and Nevada business interests, on balance, [his] familial abode and physical presence more strongly indicate that his most settled and permanent connection was in California,” the OTA decision states.
Case will come down to a ‘battle of the experts’
Michael Lesage, a Toronto litigator who acts for clients suing their former professional advisors, says it’s relatively rare for cross-border mandates to come under scrutiny in Ontario courts. However, he adds that will make little difference to the progress of the case.
“The biggest issue will be the one that is foundational in any professional negligence action, which is whether the actions of the professionals met the applicable standard of care,” says Mr. Lesage, who has no involvement in Mr. Peters’ case.
“Ultimately, I think this case will come down to a proverbial battle of the experts. Both sides will likely retain accounting expert witnesses for their opinions on whether the accountants had a duty to investigate his residency more thoroughly.”