Mr. Holmes Bakehouse Could Be Next Victim of Government Shutdown

In addition to causing a crisis among unpaid workers, the government shutdown is affecting the country in a myriad of disturbing ways, from vandalism at National Parks to fewer FDA food inspections. Now popular San Francisco bakery Mr. Holmes Bakehouse is feeling the squeeze as the IRS — whose phone lines are currently unmanned — threatens to seize $86,296.40 it claims is owed to the government.

The bakery is known for its inventive pastries that draw long lines, like the cruffin, a croissant-muffin hybrid. Owner Aaron Caddel, who runs an additional two locations of the bakery in LA, says that the amount that the IRS is demanding is part of a mistake on the part of the government, one he’d been working to resolve with a real live human being before the shutdown began on December 22, 2018. Caddel tells Eater SF that payroll company Paychex sends his company’s payments to the IRS; when they first received a notice his accountant was able to prove that the funds had been paid. “We reconciled it with them and showed that we had made our payments down to the cent,” says Caddel.

Then, on December 24, when Caddel received a computer-generated letter of delinquency stating that he had 30 days to pay the amount owed or it would be seized from his company’s accounts, the IRS’s phone assistance was no longer staffed.

A small amount of “excepted employees” remain on duty, meaning that when Caddel’s 30-day notice is up on January 23, a non-furloughed employee could seize the assets. Meanwhile, the IRS “will be recalling a significant portion of its workforce, currently furloughed as part of the government shutdown, to work,” in order to process tax filings, beginning January 28.

“We are committed to ensuring that taxpayers receive their refunds notwithstanding the government shutdown. I appreciate the hard work of the employees and their commitment to the taxpayers during this period,” said IRS Commissioner Chuck Rettig in a statement posted on the IRS website.

“Even if they do take it out they’re going to put it back but it’s just kind of ridiculous,” Caddel tells Eater SF. “It’s a bummer that this is impacting small businesses and going beyond politics.”

Though there aren’t many options, Caddel could send a certified letter to create a record of his efforts to resolve the case, but there’s no guarantee that it would be seen or processed in time. According to The Intercept, the blow would not be fatal to the business, though Caddel says that the seizure would be “super impactful” to his small business.

“I’m the last person people should feel sorry for,” says Caddel. “This is a small business but we’re doing great and other people aren’t getting paid.”

• Shuttered IRS Is Sending Automated Warnings of Asset Seizures, With Nobody to Call to Stop Them [The Intercept]