IRS: My Personal Experience With the Paper Mafia
The scandal with the Internal Revenue Service seems to have taken a back burner with the recent coverage of the infamous Florida court case. For the people who think the IRS is not acting inappropriate, while you are entitled to your opinion I would speculate you have never had to deal with the IRS outside of receiving your yearly refund check. For others, including myself, the IRS can be a relentless version of Al Capone; threats, intimidation and demands of money that you don’t have. As a small business partner to my husband, who once had a thriving private practice in the mental health field, our experience with the IRS was very much like a mob movie. This is my account of that experience.
In 2005, a regular day of patients at our practice was intended when a representative of the IRS (I will call her “Ms. D.M.” for fear of retaliation since she is still with the SC branch) stormed into the office, flashed her badge and demanded to see my husband. I tried to explain to her that he was in his office to see a patient, but she didn’t care and raised her voice so that patients sitting in the waiting area could hear her as well as my husband and the patient in his office. When he opened his door, she didn’t care that his sessions were supposed to be private and instead forced her way into his office and asked his patient to step out. At that point she stood in my husband’s office and demanded he write her a check for $75,000 payable to the Department of Treasury. Ms. DM went on to state that if he did not pay what the IRS said he owed within the next 30 days that they would sell the properties to get their money. Now at this point, we knew we owed taxes but we were disputing their amount and had a CPA who was handling all of our affairs at that time and was in constant contact with the collection division of the IRS including this agent Ms. D. M. We were also working on obtaining financing for the amount owed by refinancing our personal residence. However, it was not fast enough for Ms. D. M. and clearly she was using intimidation and threats to get a taxpayer to comply with her demand. Guess she didn’t receive that multimillion-dollar taxpayer funded line dancing training to ease that attitude?
The day after this incident I started to seek assistance with the Tax Payer Advocate service and filled out form 911. Despite the TPA insisting that Ms. D. M. was out of line in her tactics to collect, the advocate office stated we could not receive any assistance because we had too much in the way of resources (i.e.; equity in our property) and basically stated the only thing they would do is ask the collection side to hold off on the levy action until the refinancing of the home was completed. About 45 days later we paid our debt.
Move forward to 2009 when I filed two amended returns for 2006/2007 to cover business losses for services we provided to the state of Georgia but we were never reimbursed for. For over 2 years the IRS literally had our returns and did nothing with them. I was in constant contact with the agency and wrote down the various employee names and their employee number every time along with a synopsis of our conversation and each employee I spoke with on those separate occasions all noted that my phone calls were documented in their system. It became ridiculous to continually hear how our returns were logged in the system and was in the audit department but they could not tell me anything further. In 2011 we could no longer afford to stay open (due to changes in reimbursement rates from Obamacare) and realized at the rate of our expenses versus income we were actually paying people to come seek assistance so we closed the practice. Magically within 30 days the IRS notified us that the two returns (06/07) that had been sitting in dormancy at their offices for almost 3 years were being audited and so was the practice. The auditor (again do not want to include his name for fear of retaliation) showed up in a new Mercedes (I.Kid.U.Not) and while this experience is nothing to celebrate, he was pleasant. The process of the audit itself spanned around 6 weeks but as of today, we have yet to receive the final report because without any explanation the IRS decided our business losses for the years of 06/07 were being denied and once again we found ourselves owing another $40,000 in taxes plus penalties and interest. This did not include the state of SC who would now rule we owed them additional taxes, penalties and interest as well.
When asked why we were denied a standard business loss that the CPA confirmed was routine, the only response from the auditor was his Supervisor said she was disallowing the business loss and never provided any further explanation. The last word we heard from the auditor was that when he got home to Columbia (South Carolina) he was taking his wife out to get her Mercedes “C” Class that she decided she wanted after he purchased his. (I. Kid. U. Not.) Now please don’t misunderstand me, I am not condemning the auditor’s ability to purchase new vehicles. It is however disheartening to hear his celebration when you were just told you now owed thousands of dollars in new taxes with no explanation as to how they decided to deny business losses and you also realize they are paid in bonuses for collections. Instead we as taxpayers are just supposed to accept what the agency rules as gospel and pay the bill because, after all, they are the “IRS”.
The other frustrating experience that many who have been through what my husband and I have with this agency understand is how insignificant this agency will make you feel—and how trying to obtain financing is near impossible with today’s standards when the financial institution pulls your credit ratings and see the tax liens. While banks and/or mortgage lenders are compassionate about the plight of someone in our situation that was not reason enough to approve the loan. Three months ago my husband lost his job in the academic field as a Dean and four months ago the radio station I worked at closed. However, the IRS despite having over 85% of the bill paid still demand we pay the full amount even though we have no income to pay anymore and no further opportunity for financing. I wrote the Tax Payer Advocate office once again requesting assistance and look at the option of an “offer in compromise”. That was a month ago and we have yet to hear anything. Oh, but we did hear from the IRS again. This past Monday I signed for a certified letter from them; it was another threat to end our payment arrangement. I submitted the form f9423 with an explanation that we have no income and request an offer in compromise yet again.
Now if I was someone like Charlie Rangel or Al Sharpton who failed to pay their taxes, report revenue or in some cases failed to file taxes how much of a chance do you think they have in going to jail? Obtain financing? Face a criminal audit? Or how about making hundreds of thousands of dollars a year as Sharpton does and yet he can claim financial hardship to qualify for an offer in compromise? How is that possible? Now there are many examples on both sides of the political isle but Sharpton and Rangel both are the poster child(s) for demanding the concept of “social justice” which is why they are listed in my article. Sharpton is famous for spewing his hateful rhetoric and has made a lot of money off of it and Charlie Rangel has used his position in politics to become quite wealthy but both have the audacity to sit in front of cameras and the people who will listen and demand more money be paid out for their ideology yet they refuse to write their own checks for money they owe to the system.
The importance of me writing just a portion of my personal experience (I left out much more) is just to vent my frustration as to how we as citizens are just supposed to accept what the IRS agency says as the rule of law. That we are just supposed to write our checks at the end of each year and not question the fraud, abuse or waste that we have witnessed in the past 6 months alone. This behavior is nothing new but the tax burden will become worse and at some point people have come to realize “why bother?” Why sacrifice time, money and energy in your business only to have an agency decide what you will pay, when you will pay it and how you will pay it. They will also destroy you in their process of getting your money. When you couple that with the liberal mantra of “paying your fair share” why is there any question on when we decide that enough is enough?
This experience has also been an emotional drain and nightmare for me but most importantly my husband, who was fighting this agency before I entered his life. Now he just realizes he has someone in his corner fighting the fight with him.
I believe in abolishing the IRS. I believe in the Fair Tax. With that we would all pay our “fair share” and no one will come to your door demanding you cut her a check. We would also not see any more headlines of wasteful spending of taxpayer money on fancy conferences or illegals or felons who obtain millions of dollars in refunds despite not paying any taxes. Kind of hard to want to whip out that checkbook when you realize the money our Government spends/wastes alone and demands more of is off the sweat of the brows of hard working good people, many small business owners who but in 60+ hours a week to be successful and sacrifices so much. For me it’s not a Democrat or a Republican issue, but instead the concerns belong to every taxpayer. It should, because at this rate no matter what scale of income you find your mark, or political side of the fence you want to stand on, it will affect you.
When you also consider the targeting of conservative groups and individuals by the IRS, how can anyone not be concerned of an agency whose power is being used for political gain? In our experience it makes me wonder if we were somehow targeted because for years our office building was used as campaign headquarters for many Republican events that included Newt Gingrich, Lindsey Graham and Jeff Duncan. It was reported in a recent article by Newsmax that the IRS illegally access then senatorial candidate for Delaware Christine O’Donnell’s records and used them against her in the campaign between her and Chris Coons. I don’t think we’ve seen the last of other examples gross negligence and illegal activity from the IRS. It is chilling to see how a Government that is supposed to be “by the people, for the people” is using an agency against its people.