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Articles
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| District Lock & Hardware seized by city tax agency |
VOICE writes, "District Lock & Hardware seized by city tax agency
BY BEN WEINSTEIN
Last month the city seized a Barracks Row hardware store for failing to pay taxes and plans to auction off its contents at the end of September.
On Aug. 16 the D.C. Office of Tax and Revenue seized and closed District Lock & Hardware — 505 Eighth St., SE — for delinquent payments of about $373,000, more than $675,000 with penalties and interest. Records show unpaid taxes dating back to 1995."
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But storeowner Michael C. Horwat said the delinquency was a mistake, and he will dispute the claims. He said the store's bookkeeper, who is his business partner's wife, made mistakes while undergoing personal problems, which neither he or her husband knew about.
“I may be a poor businessman,” Horwat said, but he added that there was no criminal intent to avoid paying taxes. “District Lock & Hardware doesn't deserve to be treated the way we've been treated.”
Tax office records show District Lock & Hardware failed to pay withholding, personal property and sales taxes. Horwat said the business also did not pay federal and Maryland state taxes, but that he negotiated monthly payment plans for both. The Voice could not obtain records of the negotiations in time for publication.
“I want to reach a settlement and keep the business,” Horwat said. But he said with the store shut down for the last month, “I don't know if we can survive anymore.”
“We make every attempt to work with the business or the individual to bring them into compliance,” tax office spokeswoman Natalie Wilson said.
While Wilson said she could not respond to the specific case, she did say that when businesses don't respond, the tax office is forced to seize them.
The tax office posted plans to auction on Sept. 27 the business's contents, which include all the hardware and retail items, plus store equipment and a company truck.
“It makes no sense,” Horwat said of the auction, adding that the city will get pennies on the dollar for the store goods rather than more substantial repayment if they allow him to reopen the business.
Horwat also said he's worried about his employees. “They put five or six employees out of work.”
On Sept. 12 Horwat met with a staff member at Mayor Adrian Fenty's office and said she heard his complaints and said she would follow up with him.
Fenty spokeswoman Dena Iverson the mayor’s office cannot get involved in such cases after a resident has retained legal representation.
“If [the tax office] continues to pursue this, we'll probably take a legal route,” Horwat said.
Horwat bought the store in 1994, but it's been on Capitol Hill since the 1940s.
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Posted on Sep 12, 2007 20:41pm.
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