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Have at my taxes, and yours, tales from the front

By Edited Sep 21, 2015 0 0

The first time I got audited I was a bit surprised as I was on welfare at the time. I was so broke I did my taxes myself, thinking there were instructions for each line. I was confident if I read the pamphlet carefully, I could fill out an E-Z form correctly. For heaven's sake, I didn't even have to spell "Easy" to get going. Calculator in hand, I summed up my income and signed the bottom. The year was 1988. The booklet was so much slimmer and simpler it's almost quaint. Those of you who are old enough may remember a scant few years later a republican running for president on a "Flat Tax" campaign. He imagined our return to be the size of an index card. Instructions not necessary. That didn't happen.

Instead, I received a check and a letter from the IRS. After auditing my work, the government decided I had not done my math correctly. I was on welfare and I got a refund. Imagine that! Your tax dollars at work. After that the government decided I was dumb enough to do my own taxes. They left me alone for ten years. I was audited a second time after a huge drop in income. There are red flags for audits, being on welfare is not generally one of them. If you are making substantially less than you made last year, I recommend a trusted professional do your return. Don't go to a franchise. The workers there may not be any smarter than you, might be using "Turbo Tax" in the back room. Go to someone with experience and results. Taxes are complicated and the IRS is slick.

Most of the time even if you can win, you can't win. My friend after her brain injury received a large amount of money. She was audited because of the huge INCREASE in income. The lawyer she spoke to, told her kindly, you can pay me or you can pay them. It will end up the same amount out of your pocket. I wish for spite she had paid the lawyer. She was tired from her injury and in no position to fight. She paid the IRS. I had another friend audited after an inheritance, smacked with a tax penalty for not "withholding enough." One wonders how she was to predict the year her parents would die. Like the first friend, she rolled over and paid them.

In the day and age I wouldn't suggest anyone do their taxes just by the booklet. The booklet give instructions but not prompts. For example, you wouldn't take off on your home office, if you didn't know that was deductible. Software like Turbo Tax gives prompts for stuff like that. It costs about the same as having a professional do your return, but affords you the privacy of doing it yourself. I would recommend a software program to anyone with a simple return such as w-2's only. Anything more complex is the realm of the professional.

Don't go to a professional based on their relationship to your aunt Sally, or their popularity at the poker game. Go to someone who knows what they are doing and does it for a living. The first time I had a professional do my taxes I chose her because she was my co-worker's wife. She seemed nice. She dressed well. It was the first year I had investment income from some mutual funds. I didn't feel comfortable doing the taxes myself. The next year I looked at what she did to see if I could figure out how to do them myself and realized uncomfortably she had done them wrong. If even I could see that, well, yowser is all I can say.

I found the person who currently does my taxes by asking my lamest friend who helps him. This guy is self employed but he's so far out in left field it's scary. He told me a story about getting a letter from the IRS. He ignored their summons. This is America, he thought, what are they going to do? They took his fully paid for car, sold it at auction for less than it's value, applied the funds to his "outstanding bill" and sent him another letter. Yikes! That's what they do. He hired our tax professional to sort out his business. She successfully negotiated him down, although he never got the car back.

That's The Tax Preparer for me! I said after I heard his tale of woe. Ask around, not the successful friends so much as the ones who really needed help!


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