Detroiter's Tax Refund Nightmare Shows City's Bankruptcy Troubles

When a Detroit resident attempts to give her tax refund back to the crippled city, the resulting kerfuffle displayed the city's woes in full force.

As Detroit struggles with its bankruptcy, it is targeting city residents over tax bills wantonly

As Detroit struggles financially, the city is going after residents and workers over taxes wantonly, often without cause. (Image Source: Flickr: Dan DeLuca)

Detroit's recent bankruptcy filing has exposed many problems about the city's rotting internals, more than people would wish to see.  But Detroit's woes is not just about pensions or overpriced sports stadiums, but also about a bureaucracy so broken and wasteful that it needlessly attacks citizens in order to get money, even on matters such as tax refunds.  Such is the case with one woman, who initially offered to return her $500 tax refund, only to receive a tax bill saying she owed Detroit more than $5000.

The woman, Ella Joshua-Dixon, offered to let the city's tax department keep her $500 tax refund in 2012, in order to help the city out in what little way she could.  The Detroit income tax division, in response, sent back a letter saying Joshua-Dixon owed the city $5,296 in back taxes and penalties, dating as far back as 1999.  Joshua-Dixon, who resides in the Detroit suburb of Auburn Hills, was being harassed on these claims for some time, often on shaky grounds.

Eventually, not only did Ella Joshua-Dixon successfully overcome the Detroit tax bill, but she also uncovered another $416 the government owed her.  Joshua-Dixon discovered that most of the tax bill came from false and misread information, including a document with a mismatched Social Security and confusion over Joshua-Dixon's marital status.  What helped Joshua-Dixon significantly was vigiliantly keeping her tax records and documentation, having studied accounting at nearby Wayne State University and getting an MBA recently.

Ella Joshua-Dixon's plight comes as Detroit struggles to send tax refunds out to its residents and workers.  Notably, Joshua-Dixon's experience offers an insight into the woes of Detroit's bureaucratic problems: At one point, she met a city tax worker who struggled to get her documents because the worker had 10 piles of paper on their desk and windowsill.  Such a scene translates to a sloppy and downright broken bureaucracy, and tells a lot about of Detroit's problems.  If a woman is given a huge tax bill on false premises, who is to say that Detroit's own bad accounting is hiding something about the city's coffers, or that such accounting is to blame for their mess?

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