Local business owner says UIA won't credit her paid taxes

The WZZM 13 Watchdog team is investigating what happened to a local business owner that did paid her taxes but received notice about a delinquency.

GRAND RAPIDS TOWNSHIP, MICH. - The 13 Watchdog team is investigating another issue at Michigan's Unemployment Insurance Agency (UIA) after a local business owner says she's not being credited for paying her taxes.

Lori Hoving owns the Hair Studio on the East Beltline in Grand Rapids Township and says she paid close to $1,000 to the state's UIA to cover her share of unemployment taxes for the year for her small business.

Through her accountant, William Bailey, she provided us proof of five payments, all by check, all payable to the UIA, with her account number on the checks. Hoving and Bailey showed us proof the state's UIA deposited the money but never posted the payments to her account.

More: Michigan's unemployment agency confiscates money from innocent ID theft victim

Related: Major overhaul coming to Michigan's Unemployment Insurance Agency

That led to a recent letter from the UIA to the business that Hoving had an "outstanding delinquency" and she was being punished for not paying in time. 

"We know we've paid and they know they deposited our funds in their bank but we have not received any (communication) that they cleared our account," Bailey said.

"I don't want to fight, I just want a resolution," Hoving said.

Bailey, a former worker at the IRS, has tried to get in contact with anybody at the UIA for close to a month with no response. He sent three certified letters to the UIA that apparently have gone unopened because he says he hasn't received the green certified receipt that the mail has been received.

"It's languishing in some postal bin somewhere and I think they try to make delivery for 30 days and then they'll return it to sender," Bailey said. "We're not quite yet at that point but I don't have it back, so I think that's what's going to happen."

The Unemployment Insurance Agency has had many problems over the years.  From accusing innocent people of fraud to not answering phone calls to sending mail to bad addresses, the state's Auditor General has documented customer service problems over the last five years. 

One of the biggest issues spotlighted by the Office of the Auditor General is how many businesses are getting away with not paying unemployment taxes at all. Unemployment taxes help fund the system to give workers who lose jobs through no fault of their own, 20 weeks of benefits.

The Auditor General found the UIA would often not follow up to ensure businesses who owed taxes would pay them. The report found the UIA was missing on at least $230,000 and workers at the UIA weren't doing the work to get the money. 

That makes the situation with Hoving and her salon business seem bizarre considering she paid her taxes but isn't getting credit for it.

"On a one to ten scale, customer service has to be zero, can't go any lower," Bailey said.

Talent Investment Agency Director Wanda Stokes, who oversees operations at the UIA told us in January she's doing a top-to-bottom review of the agency. A new director for the agency will be hired this spring.

Stokes said in January: "Our goal is to make sure when you have to interface with our agency that we treat you like we would expect to be treated if we were in that line."

UIA spokesperson Dave Murray on Tuesday, March 7, wouldn't comment directly about the case but said the issue with businesses not being credited isn't broad but is something the state will work to get fixed.

"I'm not aware of any widespread problems, but the agency will work with any business that is having issues," Murray said.

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