Fighting the Great Evil – The Continuing Saga of the Tax Audit

While I’m not fighting aliens, like I was in The Alien Invasion is Coming, or Cheapskates and Stingrays, I am engaged in a longer term battle against one of the greatest evils ever wrought by man.

It’s more monstrous than the Death Star, and more evil than Sauron, Voldemort, Jane Fonda, and whatever that vampire mafia is called in that incredibly stupid series of vampire books for preteen girls and lonely middle-aged housewives, all rolled up into one.

I refer, of course, to the Infernal Revenue Service.

Now, I have always filed my own taxes.  It’s partly because I have trust issues, but also because I keep meticulous records of the tiniest tax implication, in a system which would leave Arthur Anderson in awe.  If they had my system, there would have been no Enron scandal.

I read somewhere once that Federal employees owe a gazillion in back taxes, and that if they would just pay up all that as well as take a 90% pay cut, the deficit would disappear, Israel and Iran would laugh about drawing blasphemous cartoons in each others’ holy books, and world hunger would end. 

This must be true, since before I started working for them, I never owed anything.

Things started for our hero (that’s me) back in late November, when I received an early Christmas card, stating that there was a difference between the taxes I filed in 2009, and the amount I should have owed.

$47,685.

For the purposes of this blog, I tried four times to take a photo of the notice I received from the IRS.  It didn’t matter what angle I tried, this is what I got, whited out like it was written in vampire blood or something.  Tell me this thing wasn’t postmarked from the Hell branch office.

My ability to be in shock about anything has been long since burned out by two combat tours and a career split between an emergency room and a medical helicopter.  Fortunately, denial is a great coping mechanism, and I knew right away this was simply a matter of finding the IRS’s mistake.

I took my lunch hour that day, which is incredibly rare, as normally I just work right though it.  I arrived home, went upstairs, and dialed the number listed on the letter.

“Hello, my name is Steve and I’m in Ohio.”  Oops, that was the number for Dell Customer Service.  His real name is Ayaan, and he’s in Mumbai.  A real nice guy, and smart, too.

“Thank you for calling the Internal Revenue Service. Please remain on the line, and someone will knock on your door in a few minutes to assist you.”

That conversation played in my head, where the most interesting stuff usually is.

After a few minutes, a nice lady named Maureen answered, and within another minute, she had pulled up some information on my “examination by mail.”  They don’t use the word “audit” anymore.  The new terminology is more accurate – they write you letters, and at the end, you feel like you got a colonoscopy.

Maureen actually told me exactly what I needed to do to respond, and was friendly, courteous, and helpful.  I would be required to address each of the 43 discrepancies that the IRS had discovered, line by line, and provide information and supporting documents as required.

I returned work with a false sense of calmness, but I allowed that to carry me through the day.  That evening, I sat down with the list and looked at #1.  It seemed in one of the hundred places where the IRS asks you to “enter the larger of line 9 or line 12,” I had entered the smaller.  My mistake.  This wasn’t starting out well.

The next 21 were stock transactions with an unreported basis.  In English, that means that if I bought a stock for $100 and sold it for $110, that I should pay taxes on the $10 that I made.  Seems fair.  Let’s say that I bought another stock for that $110 and sold it for $115.  Again, pay taxes on the $5 that you make. The IRS would have recorded that I would have made $225 on those two transactions.  Not so fair.  Since I had made the trades on modest amounts between $2000 and $5000, and had earned somewhere around $563 in the process, and the IRS had recorded every transaction TWICE, it sort of explained the $243,000 in unreported income perfectly.

So I dutifully reported on each of the items, enclosing copies of forms where everything had been lawfully reported.

Me:  I am a member of the Imperial Senate on a Diplomatic mission to Alderaan.

IRS:  You are part of the rebel alliance and a traitor.

I mailed the letter, and all I could do was to wait for the response.

I finally got one yesterday.  Apparently I owe only $2,506 now, since the Emperor ignored my explanations of items #22 and #43.  I think they lowered the bill just to see if I would at some point just get tired of fighting them and pay it.

My friends who read this already know the odds of that.

For the record, I legitimately owe the IRS $63 for my mistake on item #1.  With interest and penalties, it’s just less than $100.  Once they agree to that, I will pay without objection.

But for now, I’m back on the computer, analyzing the Death Star plans, looking for a weakness.