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Two Restaurants Closed, Owe JCC Meals, Business TaxesBy Desiree Parker Tuesday, January 10, 2012
According to James City County Treasurer Ann Davis, the owners of Pancho Villa had been behind on paying taxes since May. Davis’ office worked with the owner on a payment plan, but when the landlord locked the doors the county had no choice but to seize the property to help satisfy the debt. There’s no statute that says localities need to offer payment plans, Davis notes, “but because of this economy, we sometimes set them up.” For some business owners, she said, “the hole is getting deeper and deeper.” Davis could not share the amount of taxes owed due to confidentiality laws. If the sale of the property in the restaurant, set for January 17, doesn’t satisfy the back business and meals taxes, the county can pursue the business owner for the rest of the amount due even if there is a limited liability company or other entity in place to shield personal assets, according to Davis. “We have to collect [the taxes], we are legally bound to collect them,” she says. If there are any federal taxes owed, the Internal Revenue Service lien has priority. The county can also file criminal charges of embezzlement against the business owner. Meals taxes especially can get away from restaurant owners, Davis notes, as they are collected monthly. These are supposed to be funds businesses set aside separately to send to the locality, but often that’s not the process business owners follow. According to Deputy Treasurer David Altman, a similar course of events happened with Randalls. The landlord locked the doors, and then the county served a “distress warrant,” allowing the county to sell the property inside to collect unpaid property, BPOL and meals taxes. Altman says the restaurant owner (Randall Plaxa) has been working with the county to take care of the issue, and Altman expects a check this week for the unpaid taxes. Plaxa did not respond to emails from WYDaily, but the voicemail at Randalls said the business was temporarily closed and would reopen in the spring with “a new, exciting venue, menu and idea.” Paying the taxes will not resolve the issue with the landlord, though. Altman points out that whenever landlords lock out business tenants, they do so at their own risk. Because the equipment is specifically assessed by the county, locking out owners “puts [landlords] in a position where they could have to be responsible for the tax [owed],” he says. “Landlords think they have first claim,” Altman says, but that’s not always the case. Altman suggests landlords check with the county first before locking the doors on a business. Both Davis and Altman said that there have not been any unusually high numbers of business owners failing to pay taxes; they do not see this as a trend in the county. |
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James City County seized the property inside two local restaurants, Pancho Villa in Williamsburg Crossing Shopping Center and J.M. Randalls on Longhill Road, due to unpaid business and meals taxes after landlords locked the doors.
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Comments
I'm a small business owner and know the cost of doing business. It's not easy, but it's a choice. If I didn't want to worry about those things at night, I'd work for someone else and let them take the risk.
Good luck to the small businesses in town - hang in there!
1. BPOL Tax this tax is an annual tax based on gross sales, if you lose money you still pay on the gross . I know a small business owner struggling to survive, doing renovations at cost, he owes $50,000.00 this year for this tax, he lost money this year, he is going to close his business, 25 lost jobs.
2. FICA AND MEDICARE TAX the employer matches this tax, well not now, the employee saw a reduction of FICA last year to 4.2 0/0, I st I'll pay over six percent. Imagine if small business had this tax break, over $10,000 for me to use to pay bills with.
3. Unemployment tax, I have never layed anyone off, my rate increased over thirty percent to cover big business .
4. Machine and tool tax, I pay a tax on equipment for life of the equipment, never has a zero value, always 40 0/0, some equipment like cars is worth ten cents on the dollar within a year. Think computers, business has them, they are worthless in a year, and I pay full freight every year until I throw it away.
5. Federal unemployment tax, went up last year, same as above, no layoffs.
6. Workers Compensation Tax, rates go up, no claims, to cover big business.
7. I own a restaurant, paid over $300.00 last year to Board of Health for inspection fees in addition to business license/BPOL tax.
8. Liquor License, must pay full retail for liquor to Commonwealth,no competition monopoly , protected areas for beer and wine, must pay both county and state for ability to sell alcohol. Over $1,200.00 a year.
9. Collect 9 percent tax for meals and sales taxes.
10. Trash tax and recycling tax
11. SCC Tax
12. Real Estate Tax even though I don't own the building, landlord has me pay, which is typical.
There are more fees and taxes, the government does quite well by my business. The worst taxes are the redundant ones like BPOL and Machine and Tools. The BPOL tax was to fund the War of 1812, funny that isnt a line item in the annual county and state budgets, imagine that.
As a struggling small business owner in NewTown for 5 years now, and seeing my family's wealth dwindle as we try and serve the community, may I say Thank You Millionsix so much for not caring that I fail. Your vile words indicate your heart and are truly hurtful.