While the Dallas Morning Disconnect complains about Tax Evasion, they have not demanded the resignation of the Republican Tax Assessor-Collector. He has been disconnected for years.
County, a simple refund check won't cut it
Dallas Morning News - Friday, July 13, 2007
Taxes are one of life's two great certainties. Tax refunds, though, aren't such a sure thing.
Some homeowners learned this costly lesson when the Dallas County tax office dragged its feet for two long years before telling people they were owed thousands in refunds.
Apparently, the tax man does not giveth – he only taketh away.
A change in state law created confusion for many property owners, and several thousand unknowingly paid their tax bills twice. The county waited months, even years, before making a half-hearted attempt to notify them.
The county's uninspired explanation? Oops.
Officials' claims of computer problems and promises to improve the process simply don't cut it. For most folks, property taxes are no small sum, and a few thousand dollars certainly would have come in handy.
Well, in fairness, the county surely would afford us the same leeway if a computer glitch caused us to pay our property taxes two years late. The county would just ask us to do better next time, right?
Actually, penalties and interest quickly begin accruing when taxpayers have their own "oops" moment. Then the lawyers are called.
So, a brief recap: The county makes a mistake; no big deal. You slip up; you pay dearly.
From the county's perspective, this was a minor error involving about 1 percent of taxpayers each year. But for those 8,000 or more homeowners, this was major.
To add to their woes, some taxpayers were preyed on by out-of-state companies charging hefty fees to retrieve the refunds. If the county had done the bare minimum and notified people in a timely manner, these third-party opportunists would not have been able to cash in.
The county tax office now is scrambling, sending out letters and issuing refund checks. But officials should do more to make things right with homeowners by repaying the refunds – with interest. The county also ought to be on the hook for the fees that companies charged taxpayers.
After all, if the tables were turned, there would be far stiffer penalties to pay.
Homeowners owed tax refunds
County blames glitch for not sending notices until now
By KEVIN KRAUSE - The Dallas Morning News - Tuesday, July 10, 2007
When Barry Annino received a letter from a Michigan company a few months ago informing him that a government agency owed him thousands of dollars in unclaimed money, he thought it might be a scam.
Mr. Annino, a Dallas real estate investor, reluctantly signed a contract with the company and learned that Dallas County had his money – and that he had mistakenly double paid his property tax bill.
That's when he became angry. Why, he thought, didn't the county inform him about it? And why was he forced to fork over a third of his tax refund check to an out-of-state company to collect?
Mr. Annino is among thousands of Dallas County property owners who unwittingly paid their tax bills twice during the last two years, leaving the tax office with more than $1.7 million in refunds that still needs to be returned.
Dallas County's tax office says computer problems are why it has not been able to send notices informing people of their tax refunds for the last two years – until now.
As a result, businesses have sprung up to take advantage of it, telling homeowners they can get their refunds for a percentage of the money – in some cases as much as half. The companies used Texas' public information law to purchase a database from the tax office and began contacting people who unknowingly had refunds coming to them.
The county tax office is now warning more than 2,000 homeowners who haven't claimed their refunds to ignore these solicitations and send in a form to get their full refunds for free.
"Some of ... [the solicitations] are just flat-out lies," said Shirley Jacobson, the chief deputy tax assessor-collector. "Our system is up and running now, and we are sending letters, so there shouldn't be any more problems."
Many people who overpaid have requested and received refunds, Ms. Jacobson said. Her office didn't track the total amount of money refunded to taxpayers since 2005.
That was the year a new state law went into effect that required tax offices to send tax statements to property owners as well as to the mortgage companies and tax agents responsible for paying the tax bills for some.
That created confusion for thousands of property owners, who unknowingly sent in duplicate payments.
When they received their tax statements in the mail, many didn't realize their mortgage companies had paid the tax bills from escrow accounts set up during their closings.
In 2005, the county tax office set up a computer refund system called TaxLedge that was supposed to generate letters to the taxpayers, letting them know that they overpaid and that a refund was waiting for them.
All they had to do was fill out a form requesting refunds.
But the computer system was flawed, Ms. Jacobson said. It took more than a year for the county's software vendor to work out all of the problems, she said.
None too pleased
Meanwhile, companies began contacting taxpayers with offers to get them their refunds for a fee.
Mr. Annino, who owns several rental properties, said his accountant mistakenly paid his duplicate tax bill for one of the properties. He said the county should have sent him a certified letter informing him of the overpayment.
"The county should try a little harder," he said. "You don't know about it, and there's no way to find out about it. The burden shouldn't be on me."
Mr. Annino said he agreed to a contract with Trident Financial Inc. of Michigan to find out the source of the roughly $6,000 he was owed. He said he was outraged when he learned it was Dallas County.
"Why are they telling me about this and not the county?" he said.
He said he refused to pay Trident its 35 percent fee because he said the company's letter was deceptive. But he did send the firm $500 for its efforts in letting him know about the money, he said.
Mike Skorija, president of Trident, said his company doesn't contact people until about 16 months after the refunds are due. He said he's providing a needed service because Dallas County, unlike most other counties in the nation, does a poor job of letting people know about the refunds.
"We are not out scamming people whatsoever," he said. "People thank us because they don't know about" the money owed them.
Dallas County sends only one notification letter and then it keeps the money if there is no response, Mr. Skorija said.
"If you don't respond to that one letter, you're sunk," he said. "We reattach people to money they would otherwise lose."
Sandy Cline, property tax supervisor for the Collin County tax office, said her office doesn't have a backlog of tax refunds because it has notified homeowners of the duplicate statements since 2005.
When people pay the duplicate bill, her office sends two to four notices, letting residents know they have a refund to collect, she said.
"We do the best we can to notify them because we don't want to keep their money," Ms. Cline said.
In cases in which the mortgage company has already paid the tax bill, her office will simply return the homeowner's check to avoid having to cut them a refund check, Ms. Cline said.
Ran out of time
Ms. Jacobson, the Dallas County chief deputy tax assessor, said her office didn't have enough time after the new law went into effect in 2005 to label the tax statements duplicates. But an insert was included in the mailings, telling people why they were getting a duplicate, she said.
Last year's tax statements did indicate they were duplicates and told homeowners not to pay, she said. Still, about 8,000 people sent in payments, Ms. Jacobson said.
If still unclaimed after three years, the money is divided among the various taxing entities, Ms. Jacobson said. Taxpayers can still reclaim the money, but it has to be approved by county commissioners, she said.
Ms. Jacobson said her office has to sell the tax data to the companies that request it because it's public information. But she said she has concerns about misleading information contained in some of the companies' mailings.
It's a variation of another popular scam – charging homeowners a fee to get them a homestead exemption from their local appraisal district, she said. The exemptions are free as long as the property is the owners' principal residence.
WFAA-TV's Chris Heinbaugh contributed to this report.
HOW TO GET A REFUND
Dallas County homeowners and property owners who paid their tax bills twice can request a refund by:
• Downloading a refund application at the county tax office's Web site
• Calling the county tax office at 214-653-7811
• Writing the tax office at 500 Elm St., Dallas, Texas 75202