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Eateries in Tax Crackdown (New York State targets restaurants for tax audits. Audits up 60%)
Wall Street Journal ^ | 05/23/2010 | SUMATHI REDDY

Posted on 05/24/2010 7:09:24 AM PDT by SeekAndFind

Restaurants Targeted in New Audits; 'I Will Fight That Until My Last Breath'

State sales-tax officials are turning up the heat on restaurateurs, auditing 60% more of the city's eateries in the fiscal year that just ended than the year before and leaving the industry with a case of agita.

The cash-strapped state conducted 1,077 sales-tax audits of New York City restaurants in fiscal year 2010, which ended March 31, compared with 646 the previous year. Those reviews found the restaurants owed the state $71.9 million in sales tax, compared with $40.6 million the year before, a 77% increase. About a quarter of that has been collected so far.

"We certainly have a need right now for multiple billions of dollars, and we're trying to do our best through effective enforcement of the current laws to narrow that gap so that the citizens of New York aren't deprived of important resource or that honest taxpayers aren't hit with an additional tax burden," said William Comiskey, deputy commissioner of tax enforcement for the state Department of Taxation and Finance.

Mr. Comiskey said "restaurants are one of the specific areas" that the department is focusing on in its policing of businesses in so-called cash-based sector.

State officials attribute the main reason for the surge of scrutiny to new programs that allows staff members to review two years worth of sales-tax returns through the mail or telephone conversations to determine if they should conduct a more-detailed field audit.

For the industry, the greater scrutiny has raised questions and concerns.

"Business is very difficult right now. Every penny counts. Every minute you're not spending working on improving your business, you're basically losing money," said Jeremy Merrin, a Manhattan restaurant owner who is currently being audited. "This is really taking our time and focus away."

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: audit; newyork; restaurants; tax

The chief of the Vox Pop, above, says an audit found it owed $56,000.
1 posted on 05/24/2010 7:09:25 AM PDT by SeekAndFind
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To: SeekAndFind


Restaurant owners say the audits are yet another nuisance for an industry getting hit from all corners.

Vinnie Mazzone, owner of Chicken Masters in Sheepshead Bay, Brooklyn, said he underwent a desk audit last fiscal year for the first time since he opened his restaurant 29 years ago. The audit lasted nearly 10 months and concluded he owes $50,000, a finding Mr. Mazzone said he intends to challenge.

"I'm absolutely going to contest that," he said. "I will fight that until my last breath. I don't believe in writing stuff off as the cost of doing business. The hardest part about operating a business these days is government regulations. It's just never ending."

Mr. Merrin, whose Havana Central Restaurants have three locations, said he had to ship about 50 boxes of documents to the state as part of the audit. "They are always time-consuming, and they're expensive," said Mr. Merrin. "We're talking about thousands of dollars, not hundreds of dollars.
2 posted on 05/24/2010 7:10:54 AM PDT by SeekAndFind
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To: SeekAndFind

I guess if they can’t pay, the state can just take over their businesses. Every problem has a solution, don’t you know?


3 posted on 05/24/2010 7:11:43 AM PDT by trisham (Zen is not easy. It takes effort to attain nothingness. And then what do you have? Bupkis.)
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To: SeekAndFind
"The audit lasted nearly 10 months and concluded he owes $50,000, a finding Mr. Mazzone said he intends to challenge.

Can you say, "shake down."

4 posted on 05/24/2010 7:13:11 AM PDT by mia
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To: SeekAndFind

The government should pay more attention to trimming itself and less to harassing working people.


5 posted on 05/24/2010 7:14:06 AM PDT by The_Media_never_lie
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To: mia
Can you say, "shake down."

I don't find this funny at all. If it can happen to small businesses like these, it can happen to anyone.

America started as a nation because of thuggish acts like these. I guess we've become a nation of lambs ( to the slaughter ).
6 posted on 05/24/2010 7:16:46 AM PDT by SeekAndFind
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To: trisham
I guess if they can’t pay, the state can just take over their businesses

Many non-New Yorkers don't know this, but New York State is one of those entities that LOST MONEY operating a monopoly bookies stand called the OTB.
7 posted on 05/24/2010 7:18:02 AM PDT by SeekAndFind
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To: mia
On this date today:

May 24, 1764, Bostonian lawyer, James Otis, denounces "taxation without representation" and called for the colonies to unite in demonstrating their opposition to Britain's new tax measures.

8 posted on 05/24/2010 7:19:14 AM PDT by KeyLargo
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To: SeekAndFind

Heh. :) That’s funny and sad at the same time.


9 posted on 05/24/2010 7:20:33 AM PDT by trisham (Zen is not easy. It takes effort to attain nothingness. And then what do you have? Bupkis.)
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To: SeekAndFind

Pretty soon the meters that monitor how many breaths one takes will be issued.


10 posted on 05/24/2010 7:21:54 AM PDT by Mouton
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To: SeekAndFind

Are you a New Yorker?


11 posted on 05/24/2010 7:21:56 AM PDT by trisham (Zen is not easy. It takes effort to attain nothingness. And then what do you have? Bupkis.)
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To: SeekAndFind

Looks like the auditors are the states new bag men.


12 posted on 05/24/2010 7:22:04 AM PDT by RobRoy (The US Today: Revelation 18:4)
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To: KeyLargo

During his time, he was considered a hero and true patriot.

Today, the press would call him a crackpot.


13 posted on 05/24/2010 7:22:58 AM PDT by SeekAndFind
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To: SeekAndFind
Marvelous. Two observations:

1. Success in audits means only one thing: more audits. Look for this to become much more widespread.
2. Actually it means two things: the second being more unemployment as restaurants saddled with an audit judgment have to either lay off workers or close their doors all together. How's that help your sales tax proceeds?? Can you say "umemployment dole?"

14 posted on 05/24/2010 7:24:37 AM PDT by alancarp (Please don't tell Obama what comes after "trillion")
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To: trisham

RE: Are you a New Yorker?

Yes, a proud Long Islander, one of the few habitable places in this once great state.

In fact, other than the City of NY and surrounding suburbs, the rest of the state is pretty much an economic wasteland ( yes, I am including the once great city of Buffalo in the mix ).


15 posted on 05/24/2010 7:24:49 AM PDT by SeekAndFind
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To: mia
Can you say, "shake down."

Yes, you are so right, and to be quite accurate I would say "government shakedown". If the truth be known, by the time the government calculated the amount of money it took the unproductive beauracrats to document the case for the $50,000, the government probably spent another $100,000 in salaries and benefits.

I had a tax documentation problem in 2008, a year in which I lost at lease $120,000 in the market meltdown. It took me at lease a week of full time work to correct the documentation. The government said I owed them $1.2 million in additional taxes. I settled with them for $250.00. Our government litterally has no common sense. Were I incapacitated or not able to produce the documentation to defend my tax return, the government could have confiscated everything I own. I do not have $1.2 million in assets. I am just a working guy (no 6 figure income) who has saved and invested over the years.

We have created a greedy monster with polite and legalistic tentacles. Our government has become oppressive to the middle class.

16 posted on 05/24/2010 7:26:05 AM PDT by The_Media_never_lie
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To: SeekAndFind
""I'm absolutely going to contest that," he said. "I will fight that until my last breath. I don't believe in writing stuff off as the cost of doing business. The hardest part about operating a business these days is government regulations. It's just never ending."

Barney Frank, the infamous homosexual pervert from Massachusetts, has said recently that business exists for government. This of course makes him a Communist homosexual pervert. American citizens now exist for government, not the other way around.

17 posted on 05/24/2010 7:27:08 AM PDT by jiminycricket000
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To: SeekAndFind

This is one of the reasons I’m going Galt. I file a simple 1040 and take the standard deduction. I buy most non-food items off Craigslist or at garage/estate sales. When I don’t need stuff, I sell it on Craigslist.

What I am doing is legal and there is nothing they can take from me, so far, with anything like this. This shakedown thing is also one of the reasons I’ve never opened my own business. I remember my haircut lady showing me the individual City licenses she had to have for every one of her sinks and dryers in her salon. The whole thing is a shakedown.

My attitude about this started right after the Soviet Union collapsed. I saw an interview with a bar owner in Russia regarding organized crime. He said he paid taxes to support the police, and he paid protection money to the Mob. He then said that at least the money he paid to the mob actually got him protection.

It is getting to that point in this country. Those restaurants are nothing more than disrespected revenue sources for the organized crime syndicate called government. And the government does precious little for them for the money they spend. I’d rather pay the mob protection money to keep the auditors away.

Of course, many of these businesses will be forced out of business due to the back taxes owed. And others will drain the government by clogging up the courts. This whole thing is a fiasco.


18 posted on 05/24/2010 7:28:33 AM PDT by RobRoy (The US Today: Revelation 18:4)
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To: SeekAndFind

>>America started as a nation because of thuggish acts like these. I guess we’ve become a nation of lambs ( to the slaughter ).<<

Wait’ll the unemployment benefits run out for a few million. The only thing keeping the lambs in check is the fear of losing what they have. When they have nothing, and there are a lot of them, things will get interesting.


19 posted on 05/24/2010 7:29:53 AM PDT by RobRoy (The US Today: Revelation 18:4)
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To: SeekAndFind

I’ve been to Long Island. It’s nice. I like NYC, too.


20 posted on 05/24/2010 7:30:46 AM PDT by trisham (Zen is not easy. It takes effort to attain nothingness. And then what do you have? Bupkis.)
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To: RobRoy
things will get interesting.

I think you're hiding something terrible behind that word.
21 posted on 05/24/2010 7:31:07 AM PDT by SeekAndFind
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To: SeekAndFind

One other thing: I like to pay small businesses in cash with the hopes that they don’t log the sale. They can just pocket the money and keep at least some of what they earn.

I never use cash when dealing with chains like Costco, target, etc.


22 posted on 05/24/2010 7:34:15 AM PDT by RobRoy (The US Today: Revelation 18:4)
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To: SeekAndFind

>>I think you’re hiding something terrible behind that word.<<

Like my wife likes to say, “interesting” is an interesting word.

But I’m not really hiding anything. I pretty much blabber it all over this site. I think riots and some form of civil war are both in our near future.

Let them eat health care!


23 posted on 05/24/2010 7:36:12 AM PDT by RobRoy (The US Today: Revelation 18:4)
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To: SeekAndFind

“During his time, he was considered a hero and true patriot.

Today, the press would call him a crackpot.”

No, today smarmy pundits who have replaced journalists would call Otis a “teabagger”


24 posted on 05/24/2010 7:39:37 AM PDT by silverleaf
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To: SeekAndFind

“I don’t find this funny at all.”

I hear ya’. But then again, I think the lion’s share of food service workers tend to be libtards. (Probably because they’re young and “hip”).

So if they end up with some reflected pain in the wallet, ‘scuse me if I chuckle.


25 posted on 05/24/2010 7:47:18 AM PDT by Pessimist
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To: Mouton

Pretty soon the meters that monitor how many breaths one takes will be issued.””

That will kill the New York Marathon.


26 posted on 05/24/2010 8:43:58 AM PDT by ridesthemiles
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