Since the stupidity of the I.R.S. is all over the news, I thought I'd weigh in with my own I.R.S. story.
This probably means they'll come to my house in the middle of the night and drag me off. But, as I'm sure you know, my dedication to my readers is more important than my freedom.
So it's about 4 or 5 years ago and the I.R.S. decides to audit my agency. They came into the agency and went through every piece of paper and every email and every memo and every invoice and every leftover cranberry bagel in the joint. As the majority shareholder, they also demanded my personal tax returns for the previous year.
We had the best CFO in the history of the world. Seriously. After going over everything, we came out of this inquisition 100% clean and lovely.
So they packed up their calculators and their microscopes and went home.
A week later I get a phone call...
THEM: Mr. Hoffman, during our audit I noticed that you had sold some of your shares in Hoffman/Lewis back to the company.I wish I could say I made this up, but you cannot make this shit up.
ME: That's correct.
THEM: I need to confirm that you paid proper taxes on the sale of your shares.
ME: Okay, well you have my tax retu....
THEM: So I need your tax returns for last year.
ME: You have my tax returns for last year. I gave them to you during the audit.
THEM: Yes, but they are in someone else's office.
ME: Excuse me?
THEM: They are in another office so I need for you to send me another copy of your tax returns.
ME: Wait a second. May I suggest something? What if you call down to the other office and get them?
THEM: To get your file from the other office to my office I have to apply for a file transfer and that will take about four months.
ME: WHAT? Four months to get a file from one office to another? I can send a refrigerator to Denmark over night...
THEM: Please send me another copy of your tax returns.
ME: I don't have another copy of my tax returns. You have my tax ...
THEM: No, I don't, Mr. Hoffman. It's in someone else's office. This will go a lot smoother if you cooperate with us.
We posted something on our business website yesterday that's been very popular. If you're interested, it's called "Agencies Never Take Their Own Advice" and you can find it here.
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In 1991, my grandparents' house – built by my great grandfather some 40 years prior – burned to the ground. Electrical fire, or some such. They lost everything, including a great deal of family records.
The insurance money was just enough to have a new house built on land they owned down the road, not including things like appliances and maybe some clothes to wear. Until the IRS decided they would audit them because of the insurance claim.
They asked for records for the last several years. Those had burned. The IRS did everything it could to wring money out of two older people who had just watched everything they'd known devoured by a fire.
If the IRS spent that much effort and aggression pursuing the people who really do owe it money, it wouldn't have the reputation as the giant bucket of dicks that it has. It is 10% necessity, 90% bureaucracy for its own sake. I liken it to GM in the 80s and 90s. I wonder how anyone can actually defend it, especially in light of recent events.
It is events like these that amplify the siren call of a flat tax. Drastically reduced IRS footprint. Few opportunities for the abuse of the power.
I, for one, do not like cranberry bagels.
Bob you and Ken Robbins (CEO of Response Mine) need to talk. Y'all can swap IRS tales!
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