I wouldn't even be writing this post if not for the ridiculous nature of my experience. Last week, I received a letter from the State Revenue Service informing me that we owed ~$500.00 in tax. Ah, hello?? We don't owe any tax for 2010...the business in question was a corporation closed in Dec. 2009!
In speaking with the representative at the State Revenue Service office, who I must say was extremely polite and friendly, I found that they didn't show that they had ever received my return for 2009, BUT the tax had been paid. That seemed a little odd to me...I mean really, why would I pay my tax but fail to send the return in? But hey, I'll play along. She preceded to tell me if I could just bring in a copy of my return, my status in the computer would be updated and everything would be alright.
Early this week, I swing by my CPA's office to obtain an official copy of the 2009 return and make my 40 minute drive to the Revenue Service's office, thinking I'm just going to waltz in there, drop it off, and go on my merry way. NOT! The woman at the front desk informs me that since I was showing 'delinquent' in the computer, I must speak with this one, specific official.
After waiting only a few minutes, I'm greeted by this pleasant woman who escorts me back to her desk. She pulls up my information on her computer. Amazing what information the local government has on us in their computer! Anyway, she tells me that I paid the estimated taxes to a tune of $330.00. I'm sitting there ecstatic because according to my return, I only owe the minimum of $100.00. Whoopie! They owe me money for a change!! I'm still trying to grasp the reality that I would have paid the tax but not sent in the return. I get over that quickly and quietly ask her if I will receive a refund. And this is exactly what I was told: " Yes, you will have a refund after penalties and interest are taken out" .
I seriously had to think on that one for a few moments...Penalties and Interest??? I must have had a disturbed expression on my face because she informed me that if a return is late there are attached fees, even if the tax had been paid.
I can totally understand the penalty fee, same as a late fee. But Interest? On what? Three pieces of paper??? Excuse me if I'm being an ass ignorant, but "How can they charge interest on a return? If anything, they should be paying ME interest on the over-payment of $230.00!"
Definition of Interest:
1. The fee charged by a lender to a borrower for the use of borrowed money, usually expressed as an annual percentageof the principal; the rate is dependent upon the time value of money, the credit risk of the borrower, and the inflation rate. Here, interest per year divided by principal amount, expressed as a percentage. also called interest rate.
2. The return earned on an investment.
3. Partial or total ownership in an asset.
2. The return earned on an investment.
3. Partial or total ownership in an asset.
(Investor words. com)
The response I received was "that's just our government".
So someone, please explain to me the validation of paying Interest on a piece of paper!
It's no wonder that our country is going to hell in a hand-basket!
Just one additional note...I'll be lucky if I see my refund by May!
