Sunday, June 06, 2010

BP, The Tax Man and The LA Fishermen; BP Has Paid 18,000 Claims So Far, Promises to Continue

LA TIMES - "BP's request for tax records poses a problem for some residents of fishing communities in southeastern Louisiana — the nonconformists who haven't kept records or reported their cash income (like marina-owner Michael Turgeau pictured above who is usually paid in cash, "Man, I wish I'd done a better job of record-keeping."). The first step for a commercial fisherman or coastal business seeking compensation for losses suffered in the oil spill seems simple enough: Submit copies of a commercial fishing license, proof of residence and tax statements.

But the request for tax records poses a serious challenge to some residents of close-knit fishing communities on the swampy edges of southeastern Louisiana, which for generations have harbored self-reliant nonconformists who don't pay much heed to everyday rules and regulations. In other words, they often get paid in cash — and don't always report it.

BP officials said that more than 25,000 claims had been submitted and that more than 12,000 payments totaling about $36 million had been sent to people facing financial ruin."

Update from AP on claims paid by BP: An official for BP says the oil giant has paid 18,000 claims along the Gulf Coast totaling more than $48 million. Darryl Willis is the BP vice president overseeing the claims process. He said Sunday in Florida's Escambia County that the company has received 37,000 claims so far. He says the unpaid claims are still being processed and that none have been denied. He says "we'll pay until we're done paying."


At 6/06/2010 2:28 PM, Anonymous gettingrational said...

looks like the underground economy is getting swamped by the undersea economy.

How do you compensate for probable permanent destruction of the associated businesses and the affected employees?

At 6/06/2010 2:55 PM, Blogger PeakTrader said...

"During his press conference to discuss the BP oil spill, President Obama made it unequivocally clear that the buck stops with him, telling reporters, "In case you are wondering who’s responsible, I take responsibility."

My comment: To avoid future responsibility by Obama, we'll be switching from oil to an even more expensive form of energy (of course, the buck stops as far as taking any financial responsibility).

At 6/06/2010 5:03 PM, Blogger Ron H. said...

"President Obama made it unequivocally clear that the buck stops with him, telling reporters, "In case you are wondering who’s responsible, I take responsibility."

He only says that because he likes the sound of it. He gets a thrill up his leg when he hears his own voice saying it.

I'm not convinced he understands what he's saying. If he means that he accepts financial responsibility, then he must be including all of us taxpayers.

At 6/06/2010 5:10 PM, Blogger Ron H. said...

"How do you compensate for probable permanent destruction of the associated businesses and the affected employees?"

I guess you don't. That's one of the downsides of running a cash business.

I doubt that the damage is permanent, but it might as well be for some of people affected.

At 6/06/2010 5:37 PM, Anonymous Anonymous said...

Maybe they should just accept the loss as punishment for not reporting their income, quit bitching, and move on. Should BP (actually BP's customers, you and me) also be expected to pay for other illegal activity such as oil-soaked marijuana plants?

At 6/06/2010 8:40 PM, Blogger Marko said...

I wonder what they are paying them out for at this point - one season? Are they having them sign a release? Will they come back and pay out next season if it is still a mess? Interesting.

BP should be running ads explaining that they are already buying out fishermen. That should help their reputation, I would think. Funny how Obummer didn't mention that when he said that evil BP was going to be paying out dividends to shareholders. Oh no! Now Obummer thinks he can run BP's business better than BP! Lol

At 6/07/2010 1:27 AM, Blogger PeakTrader said...

Yes, Obama says he takes responsibility. Yet, he wants BP to take financial responsibility.

Arthur Laffer is predicting a double dip in 2011 in the article "Tax Hikes and the 2011 Economic Collapse."

Perhaps, there will be a perfect storm in 2011 when the U.S. reaches the 90% threshold of government debt to GDP, which locks in countries into slow growth and high unemployment economies, while private debt remains high, taxes increase even more, and government stimulus winds down.

The U.S. has been unable to create a virtuous cycle of consumption-employment, where consumption increases employment, and employment increases consumption, etc.

I guess, that's what happens after two years of a Marxist President, a Pelosi House, and a 59 or 60 seat Democrat Senate.

At 6/07/2010 11:40 AM, Blogger sethstorm said...

It pays to keep records and go by the books. Try to be outside the law, and it no longer pays.

At 6/07/2010 11:43 AM, Blogger sethstorm said...

PeakTrader said...

You simply want a convenient scapegoat that isn't BP.

Of course, you'd probably want a recovery that is on your time, and not on his either.

Blaming that particular group gets old.

At 6/08/2010 1:28 PM, Anonymous Anonymous said...

Completely unrelated, but the picture to this post looks like Bruce Willis playing some bad character in an even worse movie.

Die Hard VII: John McClane takes on BP

At 6/13/2010 6:53 PM, Anonymous Anonymous said...

A tax return is the only acceptable proof in my opinion. I own my own business and so does my husband, and we pay taxes and social security (both the employer and employee halves) on our income.

I expect the same requiremens from businesses who operate on cash. Receiving cash does NOT excuse you from paying tax. So if someone tells BP that they make $30,000 a year, and get a 1099 from BP (which they will) and then the federal and state governments see that 1099 then I would expect them to owe tax on that amount for at least the previous year. By the way, since that is income, they will owe tax and social security on their BP claim check, so they should spend it wisely, and they will have to file a tax return for this year for sure.

To date BP has paid more than 24,000 claims according to someone who works there processing claims.


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