Battle with IRS and bank leads man to raze his house | AccountingWEB

Battle with IRS and bank leads man to raze his house

A few weeks ago Terry Hoskins had a 3,088-square-foot brick house that he and his wife had occupied since 1991. It was valued at more than $350,000 and he owed the bank about $160,000. Now the house is a pile of rubble, and he and his wife are living in one of their commercial buildings. It wasn’t a natural disaster. On February 12, Hoskins rented a 933 CAT loader and bulldozed the house.

Hoskins had been under financial stress for some time, caused by tax trouble and legal bills from a lawsuit in which a relative claimed part ownership of his business. Internal Revenue Service liens on Hoskins’s properties led his bank to come after the note on his home, according to reports.

“I have filed for bankruptcy, Chapter 7,” Hoskins told reporters. “I’m sitting here trying to pay attorney fees to fight all this. It’s just been a long, strung-out battle to fight the IRS.”

Under duress, Hoskins said, he agreed to put the house up for collateral in order to get financing for his business. “I had to come up with $365,000 in 30 days,” Hoskins said. A representative from the bank “called me at 20 minutes till 4 o’clock on the 30th day and said they also needed my house as collateral.”

Hoskins was in the middle of a loan modification on his home with Riverhills Bank when everything fell apart. The IRS filed liens on his store – Terry’s Carpets – and other property. As a result, the bank came after the note on his home. His frustration was intensified by the fact that he had never missed a payment on his home mortgage. Rather than let the bank have the house, he vowed to level it. And he did. 

“It took three years and eight months to build it. It only took two hours to take it down. That sure got their attention,” he said. “When I see that I owe $160,000 on almost a $350,000 home and somebody decides they want to take it...no, I wasn’t going to stand for that, so I took it down.”

Hoskins this week told Cincinnati NBC television affiliate WLWT that he didn’t raze his house to “stick it to the man. I still have a mortgage of [$160,000]. I still have to pay that.”
 
Hoskins said he is not ruling out the possibility of doing the same thing to his businesses. The same lender that holds the note on his home also holds the note on his business.
 
The bank is set to sell Hoskins’s business property, once valued at more than $1 million, at a sheriff’s auction next week, according to WLWT. Hoskins has hired a new lawyer to help him reach a deal with the bank. Hoskins said his lawyer is advising him not to tear down either of his businesses.
 

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