In our mail this afternoon was a fat envelope from the IRS.
Seems we were audited for 2005's tax return and apparently, we owe close to $7000 in back taxes, penalties, and interest.
God bless America.
We understand where the IRS is claiming we have the extra money--bonds we purchased when the church was doing a building project--but we can't figure out why we don't have any paperwork from the company other than a 1099-DIV which is the interest earned on those bonds, which we totally claimed. If we'd known that we needed to include the total amount of the bonds, we would have because we are fine, upstanding, law-abiding citizens like that. But I have a feeling that isn't a defense the IRS will accept. Nor will they just let us off because we're awfully cute (which we are. And funny to boot.)
It wouldn't be so bad but we were already anticipating a big tax bill this year (we've budgeted for five digits). Oh, the IRS generously offers a "payment plan" for these back taxes -- with a serious interest rate attached to it. And if we challenge it and we're wrong? More interest (and probably another penalty because the IRS apparently thinks it's fun to add those on).
This is why people hate the IRS.
We have until April 11 to get this figured out and paid. We couldn't help but note how conveniently we got this bill during the busiest part of the tax season. Paul is out of town all next week then we'll spend time with a nice accountant person trying to figure this out. I knew it was too good to be true when we received a refund last year.
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5 comments:
Well, that just stinks!!!
That's a nice way to say what we said about the situation. There was definitely lots and lots of cursing last night. An angry Carrie = lots of f-bombs
I was being PG since one never knows who will read the comments... but you're right, a fat letter from the IRS generally deserves a few f-bombs.
I've been waiting for my house in Tucson to close so I could actually afford to have my taxes done by a professional. I'm really scared about what I will owe based on the sales of stocks, moving, etc...
I hate the IRS, too.
I hope you get everything worked out and it doesn't hurt too much.
F-Bombs are totally appropriate. In fact, the mother of all F-bombs works, too.
;)
Carrie -- this totally sucks. I am so sorry. This kind of thing always causes me so much angst and stress. It seems like anything financial can be so emotional! If it's any consolation, I would have done the same thing you & Paul did, because how the heck would you know to do anything different?
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