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Unpaid taxes double in N.C., now top $1 billion

Thursday, April 14, 2011
(Updated 4:17 pm)

RALEIGH (AP) — Delinquent taxpayers in North Carolina owe the state $1 billion, enough to fill almost half the budget gap that lawmakers are looking to address with cuts to public schools, universities and health programs.

The amount of uncollected taxes from both individuals and businesses has doubled from just two years ago, in part because officials have started counting some years-old debts that were once thought to be lost forever. Revenue Secretary David Hoyle said the poor economy and high unemployment rate has also meant more people have been unable to fulfill their tax obligations.

The state has problems with about 5 percent of taxpayers.

"We're just trying to get the money that's duly owed to the state," Hoyle said. "We're down to the ones that either can't or won't pay or are trying to scheme us or scam us."

Almost half the outstanding money is slowly getting collected through wage garnishments or payment plans while others are in the early stages of collection efforts. The state currently considers more than $100 million to simply be irretrievable because there is no income or assets to seize — or because the taxpayer can't be located.

Hoyle said the average state tax collector has about 4,000 cases. A Republican budget proposed this week would likely lead to cuts in the collection efforts, Hoyle said.

Collectors have been rapidly moving some debts off the books, accounting for about $1 billion in uncollected taxes in 2010 — by far the highest in recent years. But that was offset by the $1.25 billion added to collection efforts over the same period.

Hoyle said part of the focus has been on identifying delinquent taxpayers from years past who may now have jobs or assets. He also said the Revenue Department is looking at pockets of noncompliance that may not have been pursued previously.

Former Mebane City Councilman William Hupman is at the top of the state's delinquent taxpayer list, with about $2.2 million outstanding, according to state records. Court records show Hupman has had years of tax troubles, with the IRS demanding in 2003 a tax payment of about $5 million for the 1998 tax year.

A federal judge gave the IRS approval in 2009 to search, seize and inventory Hupman's property. Hupman declined to comment.

The lingering tax dues come amid acrimonious debate over the state's budget, which is projected to have a shortfall of $2.4 billion. Democrats say the $1.2 billion in proposed education cuts proposed by Republicans could lead to more than 20,000 job losses.

Rep. Edgar Starnes, R-Caldwell, co-chairman of the House Finance Committee, said he was unaware of the marked rise in the value of taxes unpaid by delinquent taxpayers.

He pointed out the General Assembly last year gave the department money to go collect back taxes primarily by corporations. A House budget committee examining the department recommended cutting, rather than expanding agency positions.

Starnes suggested the department should shift last year's funds toward hiring people to go after individuals who are delinquent.

"They hired people to go and collect back taxes period," Starnes said.

___

Associated Press writer Gary D. Robertson contributed to this report.

Comments

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mike360000

April 14, 2011 - 8:12 pm EDT

I like this comment, ""We're just trying to get the money that's duly owed to the state," Hoyle said. "We're down to the ones that either can't or won't pay or are trying to scheme us or scam us."

It's NOT what is "duly" owed! It is what the State "EXTORTS" and forces us to pay!
Taxes wouldn't be so bad if they were honestly applied and used for rightful purposes,
but for the perks and side benefits and then the crazy laws we are expected to obey, and
then the out of control spending like there is no tomorrow. It has become a racket and fraud.
Now MISS Bev "FartOnYou" Perdue is robbing certain funds never meant to be counted in the general funds and they are still wanting more tax increases! It's extortion, plain and simple.

Then Hoyle says it is the 5% that are cheats and scamming the State out of taxes! Bubba, you have it "BACKWARDS"! It is the State cheating and scamming the taxpayer!
don't mind paying taxes for reasonable things and being left alone otherwise, but this is asinine and ridiculous!

Anyone wish to start a list of the things we could cut out of the State budget?
In general I would say we only need taxes for the basic necessities to run government.
Cut out the perks, the tax breaks, no incentives, cut out the State bureaucracy. Miss FartOnYou can quit hiring and giving raises behind closed doors. She can return the State Road Funds and Lottery to their rightful places. No more additions and increases for the college system. They can fund themselves! Just a start, add to it...

Michael
Deo Vindice

johnodrake

April 14, 2011 - 9:12 pm EDT

There are two issues that you are addressing.

The first is taxes. As much as we find taxes distasteful, they are necessary for a society to operate. Schools, roads we need them. The lawmakers we elect levy the taxes to do the peoples business. If they are not doing it right, we should not continue to re-elect them.

The second is spending. Where we don't like the choices the elected legislators make for us, we, the people need to do something besides gripe. We need to vote the miscreants out and elect legislators that will act in a manner that we want them to.

The fix is simple in theory, but a bit difficultfucult in practice. There are many voters that are looking for legislators that will 'do something for them'. Candidates pander to these voters with promises of 'elect me and I will do this or that for you'. Translated it means spend, spend, spend. This is what must change.

RonaldusMagnus

April 14, 2011 - 9:58 pm EDT

You are both right... We have to have a balance. Right now the productive part of society is overpaying and the nonproductive are overtaking. The direction we are heading is UNSUSTAINABLE....

mike360000

April 14, 2011 - 10:46 pm EDT

A Representative Democratic Republic, like a democracy can ONLY last as long as the people do not abuse their power of the vote. Once people realize and understand they can fund themselves by the vote, from the public largess, then the seeds of destruction have been sown.
(Read your history!)

It's all to easy to see the rest from here. Self-centered people, selfish people who want from the government for the sake of having, whether the pretext be for actual good or not, then corrupt the very politicians they vote into office in hopes of enriching each other at the general public's expense. Unrighteous people elect unrighteous politicians to do their bidding in the name of democracy, all the while claiming it is for everyone's benefit.... In the end we have a corrupt society electing corrupt politicians and then claiming we can vote in different politicians. To this I say WRONG! It is NOT possible because the not only have the politicians become corrupt, coming from a corrupt society, but the entire mechanism of the political system is then corrupted by the damages by so much constant abuse.

Meaning; The laws have been changed to protect the corrupt, and in such a way it becomes impossible to right the wrongs without a major catastrophic event occurring. Sadly we are at that point.....

Michael
Deo Vindice (I suggest you understand what my sig means.)

bobberpopper

April 14, 2011 - 10:47 pm EDT

Tax's are to high. We have unemployment that is out of site and the state can steal from its people without fear. So take the food out of the mouths of children and the disabled. Its ok no body cares.

mike360000

April 14, 2011 - 10:59 pm EDT

The State and, Federal Governments were never intended on being a "nanny" to the people. To thrive ALL people MUST earn their own way. I am NOT responsible for all those babies out there having food! I am sorry to inform you I am NOT my brother's slave! I am NOT my brother's house keeper or wage earner! If he actually has an accident, something really bad, then maybe I could help just a little....

What government was meant to do was to protect him from physical enemies, such as robbers, thieves, rapists, foreign invaders. NOT from our own selves or from someone we disagree with or dislike for WHATEVER reasons. We are not to have our lives DICTATED to us for the sake of protecting us from ourselves! That is crazy and it breeds dependency, ignorance, selfishness and a whole host of nasty things....... We cease being people and start becoming dependents...
We become wards of the State! Sadly we are there..........

Michael
Deo Vindice

HotRodLincoln

April 14, 2011 - 11:22 pm EDT

I paid mine I think they should pay too.

rc378

April 15, 2011 - 10:09 am EDT

yep, i agree 100%. since when did the collectibility of taxes become based on "can and willing"? i always thought i'd get in big trouble if i didn't pay them. then again, from reading this article it appears that all i'd have to do is have an elected position and everything's okay. and i can't help but think how in the world does anyone manage to owe $5MILLION dollars in taxes for one year? or even in a lifetime? if i live to be 247, at the rate i'm being paid, i'd not even MAKE that much money let alone owe it.

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