My Bad
In my post below, I assumed that the indignant wingnut was done in by one of her clients reporting paying her to the IRS. I was wrong.
Digby’s post on this individual has a quote from a different source that includes this statement from Professor Hendershott:
“The IRS calls my house and says … ‘I just wanted to let you know that we’re going to be auditing your business’ and I said ‘My businesses?’ and he said, ‘You know the expenses you take off for writing.”
So, she didn’t know she was in business, but she was taking deductions for the business she didn’t know she had, while not reporting the income.
The IRS is golden – she either lied about the expenses or lied about the income, so it’s a win-win for them – either way she was evading taxes. A nasty IRS agent would have told her to bring her toothbrush to the meeting. This is the kind of thing that put Al Capone in prison.
6 comments
They aren’t going to put her in prison. The IRS doesn’t do a lot of that nowadays, because people in prison aren’t earning money to pay their back taxes. They’re just going to be dunning her paycheck for a long, long time, once they finish applying all the penalties and thumbscrews to her :twisted:.
Hint: If you don’t understand how to account for your income and expenses, hire a tax accountant. Even they may not understand everything, but at least they won’t make stupid mistakes. And, BTW, the IRS has been auditing a *lot* of freelance writers recently, because so many of them fail to report income or expense things that aren’t expensable. If Ms. Wingnut paid even the least bit of attention to the standard publications for her sideline profession, she’d know this. But that would require professionalism on her part, a professionalism which is clearly lacking given that she didn’t even go looking for the applicable IRS publications for freelance writers, which are fairly clear and concise as tax documents go…
If she read something that told her she could deduct her expenses, there is no way it didn’t mention reporting her income.
They used to, and I assume they still do, give you some time to start making money, but if you keep writing off expenses and don’t report any associated income, they are going to audit you. You can carry losses for an extended period, but they have to see some income, or they will say it’s a ‘hobby’ and you can’t deduct the expenses associated with it.
Likely she got the expenses thing from one of those Tea Party scam “partners”. You’re probably not hooked into that rich vein of hucksterism, but TP newsletter subscribers are bombarded with things like “These perfectly legal deductions let you minimize your taxes! For more information, send $ to IamAscamTaxExpert!” and the idiots are actually gullible enough to a) pay for the bad advice, and b) actually *follow* the bad advice.
Sadly, TP newsletters are typically distributed electronically in the form of chain mails, so they’re not useful as TP — the only thing for which their content qualifies them. 😈
That is a possibility, now that you mention it, and there are/were a number of paperbacks out that dealt solely with deductions. I’m just having a hard time believing that this woman is teaching at the college level, and is this stupid. If she did what she said, she has really set herself for a world of hurt that will last a long time.
Credit card companies will probably use this as an excuse to max out her rates, as they use everything else, and her credit reports will be down-graded. That’s the main reason why you don’t make this problem public. If she continues to muck about the IRS will freeze her bank accounts, and that will ripple through the system.
It sounds like it started as a routine thing, but she is escalating it by playing ‘martyr’.
Any lawyer worth a bucket of warm spit would be reminding her “anything you say can and will be used against you in a court of law.” But apparently she don’t need no steenkin’ lawyer. Or is just ignoring him. Whatevs. Pass the popcorn :).
Her problem as a wingnut is that she thinks the worse the penalty, the greater the proof of victimhood. It isn’t a survival strategy and evolution will eventually remove them from the gene pool.