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Forsyth County business disputes stiff penalty for 1-cent tax error
State says firm must pay nearly $800

CUMMING — The old saying goes that a penny saved is a penny earned, but one Forsyth County business is being charged a substantial amount for the former.

Ross Statham, managing director for Dogwood Management Properties, said the Georgia Department of Revenue determined during a recent audit that the firm had underpaid its payroll taxes by a cent for the first quarter of 2014. Unfortunately for Dogwood, the penalty ended up being quite a few more pennies.

“We’ve been in business for a number of years, and they asked to do a fairly routine audit,” Statham said. “They came in and said, ‘OK, well you underpaid us by a penny.’

“We scratched our heads and said, ‘Well, we use a major payroll company.’ … And they said, ‘Well, you still underpaid us by a penny, we’ll send you an assessment.’ We figured we’d get an assessment for a penny. We got an assessment for almost $800.”

According to documents provided by Statham, the Department of Revenue assessed a penalty of $758.93, with $20.97 of interest and a 1-cent tax, bringing the total to $779.91.

Officials with the revenue department didn’t return multiple calls last week seeking comment on the matter. 

According to Statham, the company has “always had a great relationship with the state of Georgia” and that the unaccounted for penny was ultimately a rounding error.

“I was incredulous, just absolutely incredulous,” he said. “First, I told the state in a letter that I wrote them that I dispute the penny first and foremost, because that’s a rounding error … the state made one calculation, our vendor made another calculation.

“The second thing I said was, ‘This is heavy handed’ … I believe the auditor was going to find something to justify there being the audit, so they came up with the penny.”

Statham said that the business occasionally has penalties in other states, but this is by far the most extreme case he’s encountered.

“We all have routine things that happen,” Statham said. “We do business in four different states and we’ve had other states come to us and say, ‘Hey, your vendor was a little late filing this.’ And we’ve had to pay $100 here or $100 there.

“I have to tell you, I’ve never seen anybody charge anybody a penny and then tack it up to $800, that’s a first.”

Statham has expressed his displeasure in letters to both the revenue department and Gov. Nathan Deal, but as of last week had not heard from either.

“I have sent them back a protest, which is my right to do, and I’ve received no response,” he said. “I’ve also sent a letter to the governor to make the governor and his staff aware of this type of tactic because, frankly, I wouldn’t be surprised if this was being done to others across the state.”