Snappy newsletters. Simple Facebook sharing. Spirited comments. Sweet features are waiting… GET THEM NOW!

IRS Notice Stuns Lawyer: 'You Owe Us a Penny'

By Harry Kimball, Newser Staff

Posted Jan 3, 2009 1:10 PM CST

(Newser) – Washington may be loaning billions to automakers, but a Detroit lawyer? He has to pay an IRS bill of 5 cents, the Detroit Free Press reports. James Howarth was busy tallying the cost of paying his debt—which is "several hundred percent over the nickel," he said—when the IRS sent a second notice saying they owed him 4 cents. Howarth called an 800 line to clear things up, but hung up after "an inordinate amount of time on hold."

What's more, he must ask them for the 4 cents because it's less than a dollar. “When I owe them a nickel, I must pay them,” he said. “It's not optional. But when they owe me, I have to ask for it.” The lawyer is reluctant to pay up. “I might apply for a bailout,” he said, though his address could stymie the plan. “For us, there seems to be some sort of stigma.”

An income tax return. (Index Open)

IRS Commissioner Douglas Shulman. (AP Photo)

Graphic shows the amount of taxes collected from 1999 to 2008. (AP Photo)

A pedestrian walks by a graffiti marked wall in west Detroit. (AP Photo)

Pennies. (Index Open)

« Prev« Prev | Next »Next » Slideshow

To report an error on this story, notify our editors.

More Newser Stories

Millions Must Repay Part of Stimulus Tax Credit

Withholding errors mean 15.4M will get smaller refund or owe money

(NEWSER) - An IRS tax credit designed to lighten the load on recession-addled taxpayers won't work out as well as hoped for about 15.4 million Americans. Because certain minutiae of the new Making Work Pay credit weren’t factored in to withholding tables, more than 10% of taxpayers who file individual returns have been underpaying and will see a smaller refund than expected or actually owe money. More»

Ponzi Victims Will Be Tax Nightmare for IRS

Service expects to refund $7-$10 billion in taxes paid on fake income

(NEWSER) - The work of fraudsters such as Bernie Madoff and R. Allen Stanford will complicate the IRS’ job as tens of the thousands of victims attempt to reclaim taxes paid on income that went up in smoke, Time reports. The IRS estimates that refunds due victims to Madoff alone could total up to $10 billion, but the agency has yet to issue clear guidelines for recouping funds. More»

Identity Theft Probe Halted $1.4B in False IRS Refunds

105 busted in sweep

(NEWSER) - The Internal Revenue Service is cracking down on fraudsters as tax return seasons begins. The agency has stepped up efforts to prevent identity theft, and caught 260,000 bad returns last year, up from 50,000 in 2010, and prevented a total of $1.4 billion in bad refunds being sent out, Reuters reports. New screening measures have been put in place and hundreds of check-cashing operations are being audited. More»

Gingrich May Have Ducked Medicare Tax

He could owe tens of thousands, tax lawyers say

(NEWSER) - Newt Gingrich's tax returns might qualify him for an audit, tax attorneys tell USA Today, saying that the presidential contender may have dodged paying tens of thousands in Medicare tax. Gingrich's campaign contends that "the salary and distribution were handled properly and legally." The matter stems from Gingrich's use of what is known as an S Corporation, which sends income and losses to shareholders for tax assessment. S Corporations don't have to pay a 2.9% Medicare tax on non-salary distributions—but they are supposed to pay employees via salary to a "reasonable" extent, the IRS says. More»

In 2011, IRS Audited 12% of Millionaires

Also of note: Tax day has changed

(NEWSER) - Cheer up 99%; at least you're not getting audited. The IRS turned up the heat on the wealthy in 2011, auditing 12% of people earning a million dollars or more, according to figures released yesterday. That's up from 8% of millionaires in 2010 and 6% in 2009. By contrast, only 1% of people making $200,000 or less got a call from the tax man, the AP observes. More»

NEWS FROM OUR PARTNERS

What is Newser?

Face it: there's too much news. At Newser, we choose the most thought-provoking and entertaining stories from hundreds of US and international sources and reduce them to a headline, picture, and two paragraphs. And we do it 24/7—you can come back morning, noon, night (and in between) for something new that matters. Read less, know more.

Learn more »

Partnering with: Slate

View Newser on the mobile website

IRS Notice Stuns Lawyer: 'You Owe Us a Penny'

OTHER STORIES ON OUR RADAR

taxes • IRS • Detroit • tax refunds • penny • refund • tax liability

MOST POPULAR STORIES

[ By Views ]

[ By Comments ]

More Newser Stories

Millions Must Repay Part of Stimulus Tax Credit

Withholding errors mean 15.4M will get smaller refund or owe money

Ponzi Victims Will Be Tax Nightmare for IRS

Service expects to refund $7-$10 billion in taxes paid on fake income

Identity Theft Probe Halted $1.4B in False IRS Refunds

105 busted in sweep

Gingrich May Have Ducked Medicare Tax

He could owe tens of thousands, tax lawyers say

In 2011, IRS Audited 12% of Millionaires

Also of note: Tax day has changed

About Us

Site

Newser By Users

Community

Site Maps

Tools

More News

What is Newser?

IRS Notice Stuns Lawyer: 'You Owe Us a Penny'

Bookmark & Share

OTHER STORIES ON OUR RADAR

taxes • IRS • Detroit • tax refunds • penny • refund • tax liability

MOST POPULAR STORIES

[ By Views ]

[ By Comments ]

More Newser Stories

Millions Must Repay Part of Stimulus Tax Credit

Withholding errors mean 15.4M will get smaller refund or owe money

Ponzi Victims Will Be Tax Nightmare for IRS

Service expects to refund $7-$10 billion in taxes paid on fake income

Identity Theft Probe Halted $1.4B in False IRS Refunds

105 busted in sweep

Gingrich May Have Ducked Medicare Tax

He could owe tens of thousands, tax lawyers say

In 2011, IRS Audited 12% of Millionaires

Also of note: Tax day has changed

About Us

Site

Newser By Users

Community

Site Maps

Tools

More News

What is Newser?