Tales for Tax Time
Bill Radke
Angela Kim
APRIL 12, 2008
- Mark Johanson and his wife Lenora, $12,247 richer!
- (Tyler Johanson)
- View the Slideshow
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About 15 years ago, it was the last weekend before the tax filing deadline -- so of course, I was at the Seattle Public Library, which was being kept open until midnight.
All us procrastinators were there together, getting all our forms, borrowing calculators and pencils, having the nice lady postmark our envelopes for us. And the local KING5 news team was there with a camera crew, doing their annual story about the losers who can't get their lives together. And I agreed to be interviewed, and I gave them a funny quote.
And the quote was especially funny to my recently-ex-girlfriend, who placed a rare phone call to me the next day just to tell me that she'd seen me on the news -- and that I would never, ever change. Not my best moment, but I lived it.
If you're suffering this weekend, I've been there. I was in-country. Whether you're filing this weekend or you finished two months ago, take a break from your deducting or your gloating and listen. Because we asked you to tell us your best tax stories:
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Paula Presley, Kirksville, Mo.
In 1971, in my early 30s, I was working as a legal secretary for a fiend who had recently set up his independent neighborhood law firm (after having served in a public office for some years). Part of my job included updating the Prentice-Hall legal manuals he owned. Periodically, the publisher sent updates for the loose-leaf manual for income tax laws. While I was inserting the updates, I happened upon the section about claiming gambling winnings and losses, something I hadn't heard about before.
To build clientele, the attorney offered federal income tax preparation for a relatively low fee. One day he said: "A retired priest will be coming in to have his income tax prepared. He's fallen upon hard times, so please be nice to him."
Shortly thereafter, the priest came for his appointment. While sitting in the waiting room, he asked me, "Can I claim my gambling losses as a deduction?" Having just read the section on gambling winnings and losses, I said, "Why, yes, you can claim them, but only to the extent of your winnings." This seemed to please the priest a bit, and in a few minutes the attorney said he would see the client.
Not long after the priest had gone into the attorney's office, the attorney buzzed me on the intercom: "Paula, Father so-and-so tells me that you said he could claim some of his gambling losses. Could you come tell me about that, because I don't think he can." I took the Prentice-Hall manual into the office and showed them where I had seen that advice.
The attorney, saving face, said "Oh, that's great! That's a new law -- I'm glad you saw that." And I left the office as he continued his interview with the priest. (The law was not new, but the lawyer had not known of it until then.)
After the priest left, the attorney called me into his office and said: "I'd just like to know how it is that neither this Catholic priest, nor myself who is also Catholic, did not know of this provision, but you -- a Baptist preacher's wife -- knew about it. I didn't think Baptists gambled." I told him that, yes, Baptists frowned on gambling, and no, I didn't gamble myself. We each got quite a laugh out the incident.
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Richard Holt, Melbourne, Fla.
Dad's name and my name are nearly identical, but our social security numbers weren't at all. The "ranch" was finally sold 20 years later, and I was 17, earning money as a construction worker during summers. The IRS wanted to know about the $117,000 in income that I didn't claim on my Form 1040 "last year."
I thought I was going to die. Fortunately, the mix-up was soon enough straightened out. Dad was 55 and recovering from a heart attack -- the IRS wanted to know about his job as a construction worker, being paid minimum wages... "Farming must not be working out so well," etc.
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Leonora Johanson, Phoenix, Ariz.
We got our taxes done yesterday afternoon, and I must say, I was a little nervous. I always am, though. We try to make sure that throughout the year the taxes taken out of my hubby's checks are in-line with our ultimate tax goals: don't owe, and don't let the IRS borrow our money for free for a whole year. Basically, we want to break even.
We typically end up close to even, and the years that we have owed it was only a few hundred dollars. Not bad in my book -- we get to keep our money during the year and owe little to no taxes in the end. Perfect.
This year should have been the same, but it wasn't.
We qualify for the "usual" tax deductions and we are just regular people -- no business or any fancy stuff. So, we get going along and the question comes up of our medical/dental/vision expenses. I know the drill, and I had all the receipts tallied.
We go through the usuals -- charitable contributions, kids, etc. Next up comes work expenses. I had tallied up things like boots, uniforms and office supplies for a total of $600. Then, the accountant asks if my husband uses his vehicle for work. Yes! I hadn't thought that would be a potential deduction, so we had to go through step-by-step with the accountant.
Are you sitting down? $22,000! Yes, we got to deduct $22,000 for my husband's truck -- a truck that is probably worth less than that. How? Well, my hubby uses his truck for work. And because he has to haul things and travel into construction areas he is required to have a million-dollar insurance policy on the truck, which costs us $200 a month. That was deductible. Then there is the 40,000 work-only miles he put on it last year, and the cost of special maintenance for work (big tires and a tool box he had to buy and install).
After it was all said and done, the IRS owed us $12,247. This is the craziest and most amazing thing to ever happen to us.
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Bob Branson worked for the IRS for more than 20 years. He's retired now, and is host of the NPR show "All Things Considered" in Austin, Texas. He's seen his share of unbelievable moments at the IRS office he worked in -- like the time a certain famous country singer had to come clean about his taxes:
Bob Branson: Over a decade ago, Willie Nelson had some really serious tax problems. The IRS had seized just about everything the poor guy owned. He ended up coming to the IRS building for an appointment -- he and his lawyer actually -- and word had gotten around to the employees that Willie Nelson was in the building. So all these employees' heads kinda popped out the doors looking in the hallways. And when they saw Willie, a lot of them came out and asked for his autograph. Willie stopped and signed autographs and posed for pictures with every IRS employee that requested it. I gained a lot of respect for Willie Nelson that day.
Bill Radke: What's a taxpayer's story that has lingered with you?
If you do not have a regular paycheck where a certain amount of money is deducted each pay period to pay taxes, then you are expected to make quarterly estimated payments -- because it is a pay-as-you-go system. So one time the IRS received a check from someone -- it was made out to IRS, and it had a dollar figure on it, but there was no name anywhere on the check and attached to the check was a note that said:
Dear IRS,
Here is my estimated income tax. You'll note there is no name on it. If I have to guess how much I am going to make, you can guess who sent it in.
Why do you keep all these stories?
I keep these stories because they are just a good reminder of what I used to do. When I first went to work for the Internal Revenue Service, I thought this is going to be a gold mine for humor -- and tempering the image of the agency with humor had to be good for the image.
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From MA, 04/16/2008
How do I find out about the music used within this article that accompany each little story (ie: not the bridges between articles)?
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