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Old 12-01-2009, 10:02 AM   #1
XDCX
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Default News report - Manteca Dodge owes $853K in Sales Tax

In the category of you can't always believe what you read, a news report indicates that the former owner of Manteca Dodge owes $853K to the state of California for sales tax.

Here's a link to the news report - click here

While I imagine it's possible, it doesn't seem likely to me that the dealership could have incurred that large of a receivable before the state would have forced them out of business.

Even if you assume an average sales tax amount of $2,000/vehicle, that's over 400 transactions that were never remitted. As I recall, Manteca Dodge was only selling about 20 - 30 new cars per month.

On a different note, I wonder if a dealer can discharge this obligation via bankruptcy? I remember reading that a person can NEVER discharge debt owed to the IRS that was collected for employee withholding. I wonder if debt owed to the state for unpaid sales tax can be discharged or whether it follows a person for life?
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