Durham’s City Beverage closing amid tax problems

Durham restaurant City Beverage is closing Sunday. Customers have been sharing news of the impending closure on social media, and a woman answering the restaurant’s phone confirmed Saturday would be its last night.

The closure comes as a related business allegedly owes close to $1 million in federal and state taxes, according to tax liens and other recent court filings.

City Beverage’s owner Jim Earnhardt could not be reached for comment despite three messages left at the restaurant and an email. Earnhardt opened City Beverage in 2004 as a combination restaurant, coffeehouse and cocktail lounge. Previously, Earnhardt owned the 23 Steps bar on Chapel Hill’s Franklin Street. The restaurant is at 4810 Hope Valley Road, Suite 105, across from the Woodcroft Shopping Center.

City Beverage and a corporation, Ocean Eleven Inc., are listed together on two Durham County court records that allege the businesses owed the state for unpaid unemployment insurance in 2015 and 2016. The most recent of the two documents, filed Feb. 18, alleges the restaurant and business owe $3,208 to the state Department of Commerce’s Division of Employment Security.

James F. Earnhardt Jr. is listed as a registered agent for Ocean Eleven, according to N.C. secretary of state records. The address listed for Ocean Eleven on the federal and state tax claims is a South Durham residence owned by James F. Earnhardt Jr.

Three separate federal tax liens filed Jan. 20 against Ocean Eleven allege the company owes more than $963,000 in federal corporate and unemployment taxes dating back to 2009. The N.C. Department of Revenue alleges Ocean Eleven owes $23,853 for unpaid state taxes in 2015, according to a certificate of tax liability filed Oct. 15.

What is unclear from the court records is what if any payments the company has made on those balances.

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Twitter: @andreaweigl