Back in 2008, we got a notice from the IRS that it was investigating our 2005 tax return. They claimed that we had fraudulently deducted our home mortgage interest, because they didn't have a copy of the 1098 from our credit union in their files. So we provided a copy from the credit union (you know, the one that is an exact copy of the one WE were sent by the CU, and which we filed a copy of with our taxes). The IRS said that wasn't good enough. So we sent ANOTHER copy, notarized, from the CU. The IRS said that wasn't good enough. So we sent ANOTHER copy, along with a certified letter from the head of the CU. The IRS said that wasn't good enough, and sent the file to the auditor, and started garnishing my wages for back taxes.
When we complained about that (and it could NOT have come at a worse time, immediately after Xmas), they instituted ANOTHER investigation of our 2006 taxes. This time, they claimed I had taken an early withdrawal of all $72K of my 401(k), and owed taxes and penalties. I provided paperwork from my company proving I had merely rolled over my 401(k) money from my Merrill Lynch IRA (from my former job) to my new 401(k) with Merrill Lynch with my new job. The money was in the form of a check, sent to me, signed, and deposited within 10 days in my new 401(k). They wouldn't accept that either, and sent the file to a DIFFERENT auditor, and added this "debt" to the garnishment of my wages (meaning my boss, the General Counsel knew about it). The IRS claimed we owed over $70K in taxes, interest and penalties.
The IRS took all but $600 of each of my checks for next two months. I had to borrow money from my father (who lives on Social Security, but had a $10K limit on a credit card) to make our mortgage payments. I somehow got my bonus two months later, which allowed me to pay Dad back and cover the next couple of months, until we arrived at a "payment plan" with the IRS of $2K/month.
We kept trying to get the IRS to get the damned audits in front of the (different, of course) auditors, but trying to get anyone to speak to us was damned near impossible - we would spend HOURS on hold, only to be disconnected. We would make appointments for calls within a four hour window - which would never come. Finally, after over a YEAR of this, we scraped together money to hire a tax attorney. It took him several more months (in fact, at least 6 months) before he could get the respective auditors to pick up the files, at which point the IRS said, oh yeah, you're right - here's your money back with 4% interest (and it took months before THOSE checks arrived).
By that time they had garnished well over $40K from us - $40K that we needed to live on. We incurred damage to our credit, enormous interest charges on credit cards we could barely pay the interest on during this time, stress and of course, my stalker posting on the internet that I was a unethical lawyer and a tax cheat. And over $5K in lawyer fees fighting these utterly unfounded audits.
This past January, a neighbor pulled up outside and handed us a letter dated in December from the IRS - he said it had been misdelivered to his house several blocks away over Xmas while he was out of town. The letter said that a response to this SECOND audit letter was due THE NEXT DAY. I called the IRS and told them we never received the first letter supposedly dated in October (our mail service here is HORRIBLE), and that our 60-something accountant, who spends half the year shtupping a teenager in the Ukraine, was out of the country - we got an extension to respond - but when we finally got ahold of the accountant, he told us we could "handle it ourselves" and told us what to do.
The basis for this audit was denying the expenses of the civil harassment lawsuit against my stalker, which the accountant has assured us was a legitimate deductible expense against my business income (I have a small yearly income from consulting work outside of my salary from the firm). The accountant had told us that we could deduct it because defamation of my professional reputation and ethics was a cornerstone of my civil harassment case (I don't go into the details of what she did, but it was pretty horrific), and when I won the case, the judge put in a prior restraint condition on the restraining order, ordering her to cease and desist from defaming me on pain of ARREST, because her behavior had been so egregious.
The accountant said "all" I had to do to respond to this new audit was to provide the IRS with all of the detailed invoices from the THREE law firms that were involved in the case, including separating professional fees from the miscellaneous other expenses (WHY??) such as faxes, postage, transcripts, photocopies, court fees, etc., as well as to find ALL of the receipts for payments made to the law firms three years ago (UGH! some were telephonic checks, some were put on various of our credit cards - it was a BITCH finding them!), which we dutifully sent at the end of February, along with a brief description of what was what, and why the lawsuit was about defending my professional reputation, which was a necessary expense and therefore legitimately deductible.
When we got back from our trip late on Tuesday night, there was a letter from the IRS waiting. It was dated June 1st, requiring a response by June 16th. FUCK!! They were AGAIN denying the expenses, claiming (with no explanation of course) that it was determined to not be related to my business. And then they utterly inexplicably created and out-and-out ridiculous fiction of a "revised" 2012 return, in which they attributed the denied expenses (remember - filed on my Schedule C as offsetting - for a significant loss - the small amount of MY business income) to CHARLES as self-employment income, and then added a $10K self-employment tax to the amount owed, plus interest and penalties!!
And if that wasn't bad enough, they found a 1099 that was not reported on our return (to be honest, I don't know if this was a fuck-up by our accountant, or whether we somehow didn't bring it to him, but I'm inclined to think the former, because we DID give him a second 1099 from the same source). Now keep in mind that they found it because there was a 1099 submitted by my investment company - the IRS created the UTTER FICTION of adding the entire amount to my income as unreported income, even though the 1099 clearly showed that my basis in the sale of the assets (it was from a rebalancing of our stocks) was a nearly $5000 LOSS. In other words, they IGNORED that the 1099 showed a LOSS to be reported on our taxes, which would have made them LOWER (and which I'm pissed I didn't get the benefit of 2 years ago). They utterly falsely made my income look about $125K HIGHER THAN IT WAS, and charged us in addition for false self-employment taxes, alternative minimum taxes, interest and penalties - NONE OF WHICH ARE JUSTIFIED! They are complete fucking LYING ASSHOLES!!
Not letting the sleezebag accountant off the hook - apparently, he transposed the legal expenses and other expenses on the Schedule C, which probably triggered the audit, since it didn't make sense, as the much larger amount of "other expenses" without comparable legal expenses looked fishy. But that was fully explained in my first communication in February and the IRS ignored it.
Also, the main case in my litigation with the stalker was a civil harassment suit. Because she was caught red-handed committing forgery and perjury during the trial (it was a delicious Perry Mason moment, and the judge was PISSED!), the judge ordered me to file a formal motion for sanctions. She tried to get the sanctions hearing halted by filing for bankruptcy in FL - and it worked temporarily (civil litigation is stayed during BK), but after hiring my own FL BK attorney (MORE legal fees directly related to the case), they were able to get the stay lifted, so the civil harassment judge in CA could hear the sanctions hearing. So while there were two cases, they were intimately related, and both had to do with the acts of professional defamation. But the IRS letter UTTERLY ignored the civil harassment case, and said that what I had submitted were just invoices about a BK (as if the BK was merely about a debt that was owed to me), which was not related to my business - LYING FUCKING LIARS!!
Anyway, obviously I do not have the objectivity to deal with the IRS, since they are sleezy douchebags (in my opinion, of course) who would probably find something ELSE to harass me about if I tried to respond myself, so today we spent another few grand to hire the tax attorney again, so I don't lose my fucking mind dealing with the IRS, and end up losing the house, our retirement savings and being locked up in the slammer for sedition, treason or murder. Especially when I'm once again, fully in the right.
I really and truly don't mind paying my fair share of taxes, but this is RIDICULOUS. Someone seems to have it in for us at the IRS, and I want them FIRED. And then run over by a shitwagon.
When we complained about that (and it could NOT have come at a worse time, immediately after Xmas), they instituted ANOTHER investigation of our 2006 taxes. This time, they claimed I had taken an early withdrawal of all $72K of my 401(k), and owed taxes and penalties. I provided paperwork from my company proving I had merely rolled over my 401(k) money from my Merrill Lynch IRA (from my former job) to my new 401(k) with Merrill Lynch with my new job. The money was in the form of a check, sent to me, signed, and deposited within 10 days in my new 401(k). They wouldn't accept that either, and sent the file to a DIFFERENT auditor, and added this "debt" to the garnishment of my wages (meaning my boss, the General Counsel knew about it). The IRS claimed we owed over $70K in taxes, interest and penalties.
The IRS took all but $600 of each of my checks for next two months. I had to borrow money from my father (who lives on Social Security, but had a $10K limit on a credit card) to make our mortgage payments. I somehow got my bonus two months later, which allowed me to pay Dad back and cover the next couple of months, until we arrived at a "payment plan" with the IRS of $2K/month.
We kept trying to get the IRS to get the damned audits in front of the (different, of course) auditors, but trying to get anyone to speak to us was damned near impossible - we would spend HOURS on hold, only to be disconnected. We would make appointments for calls within a four hour window - which would never come. Finally, after over a YEAR of this, we scraped together money to hire a tax attorney. It took him several more months (in fact, at least 6 months) before he could get the respective auditors to pick up the files, at which point the IRS said, oh yeah, you're right - here's your money back with 4% interest (and it took months before THOSE checks arrived).
By that time they had garnished well over $40K from us - $40K that we needed to live on. We incurred damage to our credit, enormous interest charges on credit cards we could barely pay the interest on during this time, stress and of course, my stalker posting on the internet that I was a unethical lawyer and a tax cheat. And over $5K in lawyer fees fighting these utterly unfounded audits.
This past January, a neighbor pulled up outside and handed us a letter dated in December from the IRS - he said it had been misdelivered to his house several blocks away over Xmas while he was out of town. The letter said that a response to this SECOND audit letter was due THE NEXT DAY. I called the IRS and told them we never received the first letter supposedly dated in October (our mail service here is HORRIBLE), and that our 60-something accountant, who spends half the year shtupping a teenager in the Ukraine, was out of the country - we got an extension to respond - but when we finally got ahold of the accountant, he told us we could "handle it ourselves" and told us what to do.
The basis for this audit was denying the expenses of the civil harassment lawsuit against my stalker, which the accountant has assured us was a legitimate deductible expense against my business income (I have a small yearly income from consulting work outside of my salary from the firm). The accountant had told us that we could deduct it because defamation of my professional reputation and ethics was a cornerstone of my civil harassment case (I don't go into the details of what she did, but it was pretty horrific), and when I won the case, the judge put in a prior restraint condition on the restraining order, ordering her to cease and desist from defaming me on pain of ARREST, because her behavior had been so egregious.
The accountant said "all" I had to do to respond to this new audit was to provide the IRS with all of the detailed invoices from the THREE law firms that were involved in the case, including separating professional fees from the miscellaneous other expenses (WHY??) such as faxes, postage, transcripts, photocopies, court fees, etc., as well as to find ALL of the receipts for payments made to the law firms three years ago (UGH! some were telephonic checks, some were put on various of our credit cards - it was a BITCH finding them!), which we dutifully sent at the end of February, along with a brief description of what was what, and why the lawsuit was about defending my professional reputation, which was a necessary expense and therefore legitimately deductible.
When we got back from our trip late on Tuesday night, there was a letter from the IRS waiting. It was dated June 1st, requiring a response by June 16th. FUCK!! They were AGAIN denying the expenses, claiming (with no explanation of course) that it was determined to not be related to my business. And then they utterly inexplicably created and out-and-out ridiculous fiction of a "revised" 2012 return, in which they attributed the denied expenses (remember - filed on my Schedule C as offsetting - for a significant loss - the small amount of MY business income) to CHARLES as self-employment income, and then added a $10K self-employment tax to the amount owed, plus interest and penalties!!
And if that wasn't bad enough, they found a 1099 that was not reported on our return (to be honest, I don't know if this was a fuck-up by our accountant, or whether we somehow didn't bring it to him, but I'm inclined to think the former, because we DID give him a second 1099 from the same source). Now keep in mind that they found it because there was a 1099 submitted by my investment company - the IRS created the UTTER FICTION of adding the entire amount to my income as unreported income, even though the 1099 clearly showed that my basis in the sale of the assets (it was from a rebalancing of our stocks) was a nearly $5000 LOSS. In other words, they IGNORED that the 1099 showed a LOSS to be reported on our taxes, which would have made them LOWER (and which I'm pissed I didn't get the benefit of 2 years ago). They utterly falsely made my income look about $125K HIGHER THAN IT WAS, and charged us in addition for false self-employment taxes, alternative minimum taxes, interest and penalties - NONE OF WHICH ARE JUSTIFIED! They are complete fucking LYING ASSHOLES!!
Not letting the sleezebag accountant off the hook - apparently, he transposed the legal expenses and other expenses on the Schedule C, which probably triggered the audit, since it didn't make sense, as the much larger amount of "other expenses" without comparable legal expenses looked fishy. But that was fully explained in my first communication in February and the IRS ignored it.
Also, the main case in my litigation with the stalker was a civil harassment suit. Because she was caught red-handed committing forgery and perjury during the trial (it was a delicious Perry Mason moment, and the judge was PISSED!), the judge ordered me to file a formal motion for sanctions. She tried to get the sanctions hearing halted by filing for bankruptcy in FL - and it worked temporarily (civil litigation is stayed during BK), but after hiring my own FL BK attorney (MORE legal fees directly related to the case), they were able to get the stay lifted, so the civil harassment judge in CA could hear the sanctions hearing. So while there were two cases, they were intimately related, and both had to do with the acts of professional defamation. But the IRS letter UTTERLY ignored the civil harassment case, and said that what I had submitted were just invoices about a BK (as if the BK was merely about a debt that was owed to me), which was not related to my business - LYING FUCKING LIARS!!
Anyway, obviously I do not have the objectivity to deal with the IRS, since they are sleezy douchebags (in my opinion, of course) who would probably find something ELSE to harass me about if I tried to respond myself, so today we spent another few grand to hire the tax attorney again, so I don't lose my fucking mind dealing with the IRS, and end up losing the house, our retirement savings and being locked up in the slammer for sedition, treason or murder. Especially when I'm once again, fully in the right.
I really and truly don't mind paying my fair share of taxes, but this is RIDICULOUS. Someone seems to have it in for us at the IRS, and I want them FIRED. And then run over by a shitwagon.
