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Owner of Dog House says it’s a slog paying back taxes, restaurant has been seized

Feb. 23, 2017 By Hannah Wulkan

After several issues with the Department of Taxation and Finance, a local restaurateur is hoping to change the policies for those in debt to the state.

The Dog House, a popular restaurant specializing in gourmet hot dogs at 37-06 30th Avenue in Astoria, has been shut down by the tax department twice in the last year, most recently on February 15 for owing $168,323.88. However owner Vlad Stern claims that the policies in place for those trying to pay back debt are ineffective, and even though he has worked to pay back his owed taxes, he has only fallen further in to debt.

“I want everyone to understand that we acknowledge our faults and mistakes, and at the end of day it is our fault, but there was no criminal activity and we never purposefully evaded our taxes, and aside from the closure we are very proud of the restaurant and the brand we have built,” Stern said.

Stern and his father opened the Dog House in 2013 as first-time restaurant owners, and had little expertise in running a business. Though they successfully launched the service side of the business, they hired an accountant to run their finances who “mismanaged” the money side of things, throwing the business in to debt, Stern said.

Stern began working with the Finance Department to pay back the owed taxes in March 2015, but said that despite consistently paying down his debt, the penalties and fines continued to add up, putting him deeper in to debt, Stern said.

He worked with the Department for several years, but the business was ultimately seized in October 2016. It was closed for about five weeks, and during that time the Finance Department held an auction to sell much of the equipment within the restaurant, such as tables and chairs and kitchen appliances, though they were listed for a fraction of their cost, Stern said.

While it was closed the seven restaurant employees were also out of work.

The restaurant finally reopened on November 23 and Stern said that they were able to recover their belongings, and since then he has hired a taxation attorney and has been paying his taxes well in advance.

“We started operating properly and paying advance taxes, which we should have done from the beginning and would have if we had known,” Stern said. “We are operating as we are supposed to now, but the bill keeps growing, accumulating penalties and interest daily, and the hole just keeps getting deeper.”

The restaurant was seized again this month, and Stern said that they are again working towards reopening, though they may not be able to due to the high penalties and fines.

Prior to being shut down, Stern said that the restaurant had begun to gain momentum. It had recently grown its menu to include unique burgers as well as hot dogs, and had increased its deliveries and had regular customers. “We were really looking forward to the summer season with our outdoor area and building on the momentum we had going,” Stern said.

Since being shut down for the second time, Stern has reached out to several local politicians about the issue to bring awareness to the taxation policies.

“I was thinking that maybe there’s a way to raise awareness and have the policies updated to make sense with the way things are now,” Stern said. “A lot of people shy away from following their dreams because know how challenging running a business can be, and maybe there’s a way that the system could be better for new business owners.”

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32 Comments

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Tanya

I think they are still trying to avoid paying taxes. Majority of the time the “credit card machines do not work, only accepting cash” pay what you owe your food doesn’t taste good but you can atleast do something good. Pay up!

Reply
Vlad

Tanya,

…what do you mean majority of the time? when was the last time you were here? Don’t comment on things you have no idea about and don’t say nonsense that isnt true. Stop trolling anonymously and if you have any questions or concerns I’m always available at the restaurant. I understand it takes courage to do that in person where posting crap anonymously takes none. This ‘article’ was written poorly on February 23rd why are you still commenting on it. LET. IT. GO.

Vlad
Owner/Operator

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Anthony

I wouldn’t trust a single word this guy says. Check out the way the owner treats customers who are critical of his restaurant on Yelp. He completely berates them.

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Vlad

You went through all of our reviews? […slow clap]. Let me guess you did not read the positive ones, right? Only the negative ones, right? I thought so.
You dont have to trust me. I could care less, Anthony. I DO NOT berate. I’m simply using Yelp as a forum just like everyone else. Im a man first, business owner second. When someone crosses the line and attacks myself, our staff, and our establishment I, as a man, will damn well right defend it and stand up for it. When you work as hard as we do, you bet your ass we will defend it. We have as much right as owners to defend and reply any Yelp reviews deemed necessary, yes or no? If your feelings get hurt, well, thats your perogative. Cheers.

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Astorian

I looked up the restaurant’s Yelp page. Last month, someone suggested the restaurant didn’t have much time left a long response. What a crybaby:

“…Ok, I have to start by saying this, DO NOT, for this business, or any other business, voice your opinion about its future. People here work very hard and LOVE doing so, as it allows them to provide for their families. I would like to invite you to run this place with me for a week and perhaps this will make you show a little more respect in the future to establishments that are there to offer you a good time and a good meal. Once you see the effort that goes into running a restaurant in NYC, or any other business, you will, hopefully, refrain from being disrespectful and out of line. “

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Anonymous

Nectarios how would you know that a guy driving a benz or any other high end car didnt pay taxes. You should be censored for such a stupid comment. Just plain stupid

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Nectarios

Ok people want to judge a guy that started business knowing rent and all is very expensive didn’t pay taxes. Who do people think they are there are a lot of people that don’t pay taxes. Trump said it as well . don’t judge others not paying taxes. I see people that don’t pay taxes drive Mercedes BMW and mazerarti to the welfare office we don’t judge them now do we?

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jenastoria

By not paying taxes, this or any other business owner is cheating all of us that do pay.

Whose going to pay for the fire department if/when the kitchen catches fire? Who pays when EMT is called when he or his customer has a heart attack?
Who pays for snow plows so that customers can park in front of his place and vendors can make his deliveries year around?
Who pays for the street repaving in front of his business?
Who pays for his and his children’s public school education?
Who pays for the FDA inspectors that (hopefully) ensure that the meat products he sells are safe?

It goes on and on.

Seriously, the true welfare recipients are those who don’t pay their full taxes and the rest of us make up for the slack. That includes the so-called millionaires and billionaires that do the same. A civilized society does not mean that any of us are successful alone; it is ALWAYS a collective effort. Taxes are part of that. No excuses.

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NYDH.BH

They have a right to have an opinion. But, with running a business in New York there are a lot of moving parts and you have go be on top of it. Our fault is that this was our first restaurant venture and we were amateurs in the accountingf aspect. But, we are super proud as the brand it has become. Hopefully everything will work out.

Best,
Vlad

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Poparoo 46

Wow hes going to add burgers too. Whats next french fries, and onion rings. Fold up the tent dummy

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Poparoo 46

Oh please. Taxes are easily dealt with by a certified accountant. A pro, not some clown who you hired because he was cheap. Cheap got you a 168k tab. How this guy let this get to this point is his own fault, you mean to tell me he didnt realize something was wrong before it got to this amount. By the time it got to a few thousand, he should have reached out for help. Not knowing the restaurant business or not taking care of business is no defense for this issue. Ignorance is not a defense. This guy is never going to sell $168000 worth of hot dogs ever. Dude, chapter 7, do it now

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NYDH.BH

You are absolutely right. You have to be careful and on top of it all. It’s a great thing once you get a grasp of it. If you have any more
questions, please contact us at [email protected].

Best,
Vlad

Reply
Bob

Well well well, clearly we have a lot of accounting commenting here… Murica can’t live without small business tax money, pay taxes, bla bla bla. Meanwhile, our great president don’t pay taxes and he is smart for that! Give me a break and give a break to those who try to run small business in this country! When you are in the same position maybe you can criticize! As a small business owner, first time owning a business, the taxes rules are a nightmare, not easy to understand and if you find a bad accounting you’re in trouble, just like those men.

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what a lie

Bob, Donald Trump does pay taxes… There’s a difference between tax evasion and tax avoidance. The difference is one gets you into prison while the other is why you hire accountants. Sorry that you’re too much of a liberal to understand but if you have deducted expenses or claimed a dependent, you used the same tactic Trump used.. and you are foolish to want to pay more taxes than you are legally supposed to. What this owner did was hope he didn’t get audited and when he did, tried to blame a mistake. Well, $168,000 is owed and it’s his responsibility to pay it. Guarantee this man filed his own taxes.. no accountant would co-sign their death sentence with $168,000 owed. No small business owner would ever make such a mistake with that high of taxes.

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Boy George

You are technically accurate but the amazing amount of expenses a very wealthy person is able to “get away” with is truly amazing.

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what a lie

No, I am not technically accurate.. I AM accurate. The allowance of deducting and rolling losses is to promote entrepreneurship. After all, who will want to start a business when they have no safety net when taking risks? And it’s not like they don’t pay any taxes when they are legally obligated to. No one should pay more than they should in taxes.. that’s our right as Americans.. ever heard of the American Revolution?

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NYDH.BH

You are absolutely right! This is such a unique and challenging case that very few people would touch it. It was basically up to us to present our case the best we could. I think we did a fantastic job in terms of making the right adjustments. But, the policies in place are extremely challenging to over come no matter how much positive growth a business shows. As we have in the last [3] months. And the pentalties and interests are brutal. But, it is what it is.

Best,
Vlad

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jenastoria

Perhaps what the business owner probably didn’t pay was SALES tax. So he probably charged his customers the sales tax and the kept it. If he didn’t pay his employment taxies, e.g., social security, FICA, etc., then he is stealing from his own employees and from the taxpayers – you and me – that will have to make up for that. There’s no ethical excuse for that. Same goes for Trump and other high earning tax avoiders and evaders.

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jenastoria

To clarify, that’s my opinion (above). I’m not saying that this business owner did all that, but his vague statements lead to questions about what taxes he did not pay. Doghouse should have explained that.

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Stephen Johnson

Words of wisdom, if you are able to reopen I suggest you open for lunch during the weekday. It’s difficult to be successful in a brick & mortar business
in NYC if you operate 8 out of 24 hours. Question is, what are you willing to sacrifice to make those dreams come true? I’m not an accountant, nor an expert on legal advice. But, I have 30+ years of experience in all facets of the restaurant industry. If you are able to get out the hole, feel free to contact me. Vlad, we have spoke several times. I think you would be surprised.

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NYDH.BH

They are not ‘Hot Dogs’ they are ‘Signature Dogs’ and from what we feel, and from what our guests have said, are ‘…really good’. Thank You.

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what a lie

what a load of b.s from the owner. You don’t mistakenly owe $168,000 in accrued taxes when you’re a small business. Pretty obvious what happened here. pay your taxes and stop looking for remorse. I for one know I will not be eating here. your customers pay full price that you and your accountants priced accordingly knowing taxes have to be paid and you are trying to evade them. Sob story.

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NYDH.BH

No remorse. No sob story. No blame game. Growing pains. Honestly. We hope you have an opportunity to give us a try.

Best, Vlad

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whteva

They should be fined and prosecuted to the fullest extent of the law! No Excuses..pay your taxes..we all have to!

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NYDH.BH

You are absolutely right. It was our fault at the end if the day. But, I feel that since we have started working properly and have proposed numerous payment plans since re-opening on Nov. 23rd, everyone deserves a chance to make it right. But, everyone has an opinion as well. Best, Vlad.

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