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Two+ year "battle" with the IRS is finally over...and we won. YAY!

bbhaag

bbhaag

Diamond Member
This is gonna be a little wordy because we all know how "awesome" the IRS can be but essentially back in late 2017 our payroll exceeded the amount that can be reported using form 941 and we needed to file using form 943. There is no difference in the amount we needed to report it was JUST the form needed. So we reported and paid the correct amount.

In late 2018 we received notice from the IRS that we did not pay the correct amount even though we did and by that time we had filed the appropriate paper work moving us from form 941 to 943. So for the past TWO+ years we have sent proof to them which included bank statements, the original forms, and the updated forms showing we had in fact reported the correct payroll tax for that quarter. Dozens of phone calls and countless faxes all sending the same information were sent over the years.

It all came to a head this past winter with the IRS sending us a letter saying if we didn't pay they would deduct the amount from our account plus fines and fees to the tune of $20K😱

Ok so this is getting a little long but today we received an email from our CPA stating that after the last phone call with the IRS and sending out the same info again they FINALLY dropped the matter. The letter stated we did not owe the $20K and they "considered the matter resolved" making no mention that for the past two plus years they were in fact WRONG.

Suck it IRS!!
 
haha. they lost my paperwork like 6 times when I had an issue. 🙄 good for you sticking through it.
 
As someone that works in tax - the IRS is ultimately filled with idiots that work on computer-based automation of "trying to find 'gotchas'" instead of knowing actual accounting.

It's a game of idiots with too much authority vs. people with much higher intellect being forced at gunpoint to prove their innocence as sad as it is.

Anyways, I have something semi-related coming up where I received a rebate from my state that they are deeming as taxable income... Grrr...
 
lxskllr said:
Glad you "won", but you still lost. Your cpa probably wasn't working for nothing while playing games with the irs. The way I see it, the irs owes you actual costs plus punative damages.
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Oh yeah don't get me wrong I understand that but when you're a SB and not some multi national corporation you take your wins when you can get them. In an ideal world I'd do just that but you and I both know the world we live in ain't like that.
 
Wow that sounds like a freaking pain in the ass. IRS and CRA are both scum.

Meanwhile most megacorporations pay 0 taxes and they never get caught up in anything or forced to pay. It's BS.
 
Red Squirrel said:
Wow that sounds like a freaking pain in the ass. IRS and CRA are both scum.

Meanwhile most megacorporations pay 0 taxes and they never get caught up in anything or forced to pay. It's BS.
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Yeah it has been a nightmare man. Like the thousands of things a SB owner has to deal with on a yearly basis isn't enough but then there was this looming threat that would pop up every couple of months with yet another letter from the IRS. The fact that they threatened to just take $20K from our account was just sickening......and there wasn't anything we could do about if they decided to.
Good luck ever getting that money back ya know what I mean? I know this is ATOT and 20 grand is chump change but to us that is some serious cash.
 
This is how the system can be designed to force people to "stimulate" a certain market.

The "arbiter" is almighty and thus cannot be contradicted without a fee to some professional if the arbiter chooses to engage in bad faith behavior.
 
Torn Mind said:
This is how the system can be designed to force people to "stimulate" a certain market.

The "arbiter" is almighty and thus cannot be contradicted without a fee to some professional if the arbiter chooses to engage in bad faith behavior.
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It's simply a matter of a government that knows and understands that a small business or majority of individuals don't have the capital or legal knowledge to argue against.

I've talked to tons of clients about state audits as part of my job - the goal is always "Put up a bunch of shit (accusations) and hope something sticks". At the end of the day, roughly 10% on average might stick - and thats for large companies that have the capital to defend stuff.


It's just like government regulations - government licenses - government audits - government everything - they serve as bottlenecks that prevent small businesses from succeeding and it's just a small write-off for large corporates.



For anyone who wants to complain about monopolistic endeavours - that is a quick culprit to bringing aboard competition.
 
bbhaag said:
This is gonna be a little wordy because we all know how "awesome" the IRS can be but essentially back in late 2017 our payroll exceeded the amount that can be reported using form 941 and we needed to file using form 943. There is no difference in the amount we needed to report it was JUST the form needed. So we reported and paid the correct amount.

In late 2018 we received notice from the IRS that we did not pay the correct amount even though we did and by that time we had filed the appropriate paper work moving us from form 941 to 943. So for the past TWO+ years we have sent proof to them which included bank statements, the original forms, and the updated forms showing we had in fact reported the correct payroll tax for that quarter. Dozens of phone calls and countless faxes all sending the same information were sent over the years.

It all came to a head this past winter with the IRS sending us a letter saying if we didn't pay they would deduct the amount from our account plus fines and fees to the tune of $20K😱

Ok so this is getting a little long but today we received an email from our CPA stating that after the last phone call with the IRS and sending out the same info again they FINALLY dropped the matter. The letter stated we did not owe the $20K and they "considered the matter resolved" making no mention that for the past two plus years they were in fact WRONG.

Suck it IRS!!
Click to expand...
I would put that letter in a very nice frame and hang it next to the first dollar you earned. That is a win even if it cost you $10k in extra CPA pay.
 
I wonder if you can sue the IRS, it would almost be worth it just to get satisfaction. I imagine it's not possible though, they probably have special protections for that.
 
Red Squirrel said:
I wonder if you can sue the IRS, it would almost be worth it just to get satisfaction. I imagine it's not possible though, they probably have special protections for that.
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Lol no. And if they make a mistake, it's 100% on you to prove it. There is no burden of proof for them, they don't even have to tell you why you owe them, just that you do and the amount, and its up to you to figure it out.
 
herm0016 said:
Lol no. And if they make a mistake, it's 100% on you to prove it. There is no burden of proof for them, they don't even have to tell you why you owe them, just that you do and the amount, and its up to you to figure it out.
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Yup.

Like I said, I talk with clients all the time about audits.

They come in and accuse you of shit - it's essentially guilty until proven innocent - and then they just sit and hope you don't have the documentation to prove that something is deductible/exempt/non-taxable.

I mean just think of all the documentation that goes into your typical business transactions: Purchase Requisitions, Purchase Orders, Invoices, Sales Orders, Sales Receipt, Sales Invoicing, Bill of lading, Receipt invoice, statements, debit notes, etc... etc.... the list goes on and on. Thats just at the transaction level - then you have your accounting books, trial balances, balance sheets, apportionment, etc.

Just imagine millions upon millions of transactions entered in by countless dumb people in accounts payable, accounts receivables, etc... Yeah, you 're going to lose some documentation is some areas for some transactions. It's the nature of things.
 
s0me0nesmind1 said:
Yup.

Like I said, I talk with clients all the time about audits.

They come in and accuse you of shit - it's essentially guilty until proven innocent - and then they just sit and hope you don't have the documentation to prove that something is deductible/exempt/non-taxable.

I mean just think of all the documentation that goes into your typical business transactions: Purchase Requisitions, Purchase Orders, Invoices, Sales Orders, Sales Receipt, Sales Invoicing, Bill of lading, Receipt invoice, statements, debit notes, etc... etc.... the list goes on and on. Thats just at the transaction level - then you have your accounting books, trial balances, balance sheets, apportionment, etc.

Just imagine millions upon millions of transactions entered in by countless dumb people in accounts payable, accounts receivables, etc... Yeah, you 're going to lose some documentation is some areas for some transactions. It's the nature of things.
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herm0016 said:
Lol no. And if they make a mistake, it's 100% on you to prove it. There is no burden of proof for them, they don't even have to tell you why you owe them, just that you do and the amount, and its up to you to figure it out.
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It's just one of many examples of how a system that can be designed to dominate the populace. Lack of accountability+their word is presumed truth makes for a predatory system.

And a lesson that people will adhere to "on my honor" is bunk.

Other bodies have similar systemic favors. HOAs, police departments, etc.
 
herm0016 said:
Lol no. And if they make a mistake, it's 100% on you to prove it. There is no burden of proof for them, they don't even have to tell you why you owe them, just that you do and the amount, and its up to you to figure it out.
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Kind of figured, it's a piss off that it really works that way, they are basically a legalized mafia. Unless you took accounting as your main trade they can pretty much drag you through the ringer and not much you can do about it I guess.
 
I've done battle with the IRS as well. An experience I do not care to repeat. 😉

I've always done my own taxes no matter how complex they get. I've never used automated software and even filed paper returns from 1985-2017, over 30 years.

I still do my own tax work because I want to be in complete control and have an understanding for all the forms and their requirements.
 
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The ignorance in this thread is amazing.

For those who dont know (and it appears to be a lot of you) the reason the IRS tends to go after poor people more often is they know such people cant defend themselves with lawyers and accountants.
They rarely chase down rich fuckers because those guys can afford the legal team needed to fight off the IRS.

Retired IRS people have admitted to this many times.

www.waynedupree.com

Wayne Dupree

Wayne Dupree political stories
www.waynedupree.com www.waynedupree.com
 
Sonikku said:
Just imagine if the IRS scrutinized big business like they did small ones.
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That's the part that pisses me off the most really. Big businesses get a free pass and have tons of loopholes they're allowed to use. But if small business or individuals do it... they'll get nailed to oblivion, probably even get their business shut down and maybe even do jail time.
 
Yeah supposedly in America most of the larger corps effectively pay zero dollars in taxes.
We deal with just that problem right there and we can cure cancer, give children good educations, and also feed them decent lunches.
 
shortylickens said:
The ignorance in this thread is amazing.

For those who dont know (and it appears to be a lot of you) the reason the IRS tends to go after poor people more often is they know such people cant defend themselves with lawyers and accountants.
They rarely chase down rich fuckers because those guys can afford the legal team needed to fight off the IRS.

Retired IRS people have admitted to this many times.

www.waynedupree.com

Wayne Dupree

Wayne Dupree political stories
www.waynedupree.com www.waynedupree.com
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this is so true...
If you get a Tax Attorney shit gets done so much faster then having to handle it yourself.
But of course a Tax Attorney will charge you which a lot of the lower income people just can't afford, as no one would really spend 15-20k retainer for a 15-20k audit, and rarely will a tax attorney want to handle a case which won't be worth his/her time.

But i have been on both ends... one solo, and the other though an attorney, and well, i've learned if the figure is low, its just best off paying the penalty and saying forget it, as the time and stress lost during the whole processes can sometimes just not be worth it.
 
bbhaag said:
This is gonna be a little wordy because we all know how "awesome" the IRS can be but essentially back in late 2017 our payroll exceeded the amount that can be reported using form 941 and we needed to file using form 943. There is no difference in the amount we needed to report it was JUST the form needed. So we reported and paid the correct amount.

In late 2018 we received notice from the IRS that we did not pay the correct amount even though we did and by that time we had filed the appropriate paper work moving us from form 941 to 943. So for the past TWO+ years we have sent proof to them which included bank statements, the original forms, and the updated forms showing we had in fact reported the correct payroll tax for that quarter. Dozens of phone calls and countless faxes all sending the same information were sent over the years.

It all came to a head this past winter with the IRS sending us a letter saying if we didn't pay they would deduct the amount from our account plus fines and fees to the tune of $20K😱

Ok so this is getting a little long but today we received an email from our CPA stating that after the last phone call with the IRS and sending out the same info again they FINALLY dropped the matter. The letter stated we did not owe the $20K and they "considered the matter resolved" making no mention that for the past two plus years they were in fact WRONG.

Suck it IRS!!
Click to expand...
I'm the same way when I know I'm right, I can be a bulldog until I get what I deserve. I almost always win those battles therefore. Congrats!
 
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