How To Avoid Some Of The Traps Associated With IRS Problems

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Episode Transcription

DARRIN T. MISH: Hello hello, hello, this is your IRS solutions attorney, Darrin T. Mish.  I’m joined today with my cohost, Katrina Madewell.  Click here to watch or read more information on IRS Back Taxes.

KATRINA MADEWELL: That’s me!  Welcome to the show!

DARRIN T. MISH: How are you doing today?

KATRINA MADEWELL: Doing great, doing great.

DARRIN T. MISH: Awesome.

KATRINA MADEWELL: Went to the outlet mall opening this morning.  Left right before the traffic got too bad.

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DARRIN T. MISH: Yeah, I’m sure that’s going to be a traffic…

 

KATRINA MADEWELL: Debacle.

 

DARRIN T. MISH: …drain for a while.

 

KATRINA MADEWELL: That’s ok, though, at least the shopping’s not so far, right?

 

DARRIN T. MISH: For those of you who don’t know what we’re talking about, there is an outlet mall opening in Wesley Chapel, Florida where Katrina and I spend a lot of time.  Just outside, just north of Tampa.  In fact it’s called the Tampa Outlet Mall, isn’t it?

 

KATRINA MADEWELL: Tampa Premium Outlet Mall.

 

DARRIN T. MISH: Oh, yeah, you got to get that word premium in there.  Looks like it’s going to be pretty neat.  There’s a big rumor they’re going to put a big Cabela’s in there.

 

KATRINA MADEWELL: They’re putting all kinds of stuff, they got a lot of stuff going on this weekend including the fireworks and all kinds of stuff.

 

DARRIN T. MISH: Fantastic, you won’t be able to get within five miles of the place, but it’s all good.

 

KATRINA MADEWELL: They gave away chairs, like baseball sitting chairs I think for a reason.  Like you’re parked.

 

DARRIN T. MISH: Wow.

 

KATRINA MADEWELL: I’m just saying.  So the topic for today’s show.

 

DARRIN T. MISH: We’re going to continue in a pattern that we’ve been going through the last several weeks.  We’re going to just talk about how people feel when they have IRS problems and some of the traps that they fall into and things like that because the longer I do this type of work, the longer I’m a lawyer, I realize that the administrative or nuts and bolts, the mechanical ways that we solve the problems aren’t as important as the way that people feel before, after, and during their representative or the handling of the problem.  We’re all kind of the maker of our own problems, whether we want to admit it or not.  Almost every one of our problems – and this is hard to hear I’m sure – but almost every one of our problems tracing back to a decision or decisions that we’ve made or failed to make.  You ever think about the fact that a failure to make a decision is in fact a decision?  You decide, hey I’m just not going to decide on that and means I’m going to do nothing which is in fact a decision.

 

What caused me to think about that was earlier this week I was speaking with a new client and he was really down in the dumps regarding what was going on with his IRS case and I was confused because we have a great sort of proposition, solution laid out for him.  It’s just a process at this point.  This stuff isn’t even hard, we talk about that in our practice all of the time among the staff how what we do isn’t even hard, it’s just a process.  You just got to work the process, you have to apply the process to the facts and good stuff comes out at the end.  It kind of reminds me of Willa Wonka movie where they put stuff in the front end of the candy machine and candy came out of the end.  Hopefully no one rises to the top and gets chopped into pieces, like the bubble machine.

 

KATRINA MADEWELL: It’s the IRS, you never know!  It’s in the realm of possibility.

 

DARRIN T. MISH: I was a little bit worried that he seemed to be so unhappy because happier people are nicer to be around.  You just naturally work harder for them.  It just seems like happier clients get better results.  They’re more cooperative.

 

KATRINA MADEWELL: Well, it’s the attitude of gratitude.  For me, I would rather walk 10 extra miles for someone that’s grateful than for someone that never even said thank you.

 

DARRIN T. MISH: Yeah, for sure.  As an attorney, I take an oath to do my absolute best for all clients and I do.  Even the grouchy ones.  But you can’t help being human.  A lot of people like to joke that lawyers aren’t human and whatnot.  But if someone is always grouchy and always tear your head off every time you talk to them, naturally they’re just not going to get as good of results.  It’s probably not going to have anything to do with me, it’s just going to be the way it is.  It’s just a Karma thing.  So I was worried that he wasn’t that happy so I took a look at what was going on with his situation and he indicated to me previously that he was concerned his IRS problem wasn’t being fixed fast enough.  So I looked and I noticed that he hadn’t actually submitted any of his documentation to us.

 

KATRINA MADEWELL: We talked about this.  What’s being submitted fast enough anyway?  It’s not really a fast process is it?

 

DARRIN T. MISH: Well, no, it’s not a fast process.

 

KATRINA MADEWELL: We talked about this before on another show and if memory serves me correctly, you’re looking at 12-24+ months to resolve it.  Isn’t that right?

 

DARRIN T. MISH: That brings to mind a different client who hired us in June of 2014 and we got to do about six years’ worth of tax returns and finally I pushed the issue here in October of 2015.  We got the tax returns done and he’s unhappy because it took so long.  Yeah, but you provided us zero information with which to prepare your tax returns so I was waiting for the bare minimum cooperation so that we could get your tax returns done.

 

KATRINA MADEWELL: Did he think you were going to do a power of attorney or something and get all of his stuff?

 

DARRIN T. MISH: Well, we do a Power of Attorney and we did get the…

 

KATRINA MADEWELL: I know, but was that what he was thinking?

 

DARRIN T. MISH: No.  I don’t know exactly what he was thinking.  I’m not criticizing that client.  This is very common.  You get trapped in these circles of sort of nonsense.  People are often trapped because they don’t know what to do because they’re scared or whatever so they just go around in circles and just spin and do nothing so it’s up to us as the law firm to try and break them out of that and provide them solutions that we know about and help them get out of that cycle.

 

KATRINA MADEWELL: So you have to say specifically I need this bank statement.  You’re giving them a very detailed list.  That helps, right?  The bullet points I’m sure.

 

DARRIN T. MISH: Yeah for sure.  It’s kind of funny too, now, you and I know that a printing out of a bank statement takes about 3-4 clicks on a computer and maybe you print it.  Maybe you don’t.  Maybe you just save it.

 

KATRINA MADEWELL: So you tell them, come in, log into your bank account, we’re going to print these, we’re going to be done.

 

DARRIN T. MISH: Well, it always is shocking about how long it takes people to provide bank statements in today’s day and age.  I’ve timed myself.  It takes 15 seconds.

 

KATRINA MADEWELL: Yeah, it’s not long.  It takes you longer to login than it does to pull them.

 

DARRIN T. MISH: Yeah.  I was worried about this guy.  We found out he hadn’t provided his paperwork.  We had a little discussion about how he needed to cooperate so that we could get to his end goal, which was the light at the end of the tunnel, the proverbial rainbow and all that kind of thing and he’s a lot happier.  It got me to thinking about some stuff I wanted to talk about today.  That sure was a long intro, wasn’t it?

 

KATRINA MADEWELL: That’s alright, it works. Sometimes that’s what it’s about, right?  All these little nuts and bolts that go into it.

 

DARRIN T. MISH: We’re all prone to being discouraged about things from time to time.  There’s really no getting around that.  But how much of that desperation stems from impatience?  We get impatient to have what it is that we want and that’s kind of part of the problem.

 

KATRINA MADEWELL: I would it’s probably in your case more anxious, don’t you think?  As opposed to impatient, they’re probably anxious.  There’s a lot of anxiety around this.

 

DARRIN T. MISH: Yeah, for sure.  There’s tons of anxiety wrapped around it and a lot of times that anxiety is just paralyzing to people and the best thing I can say is you just have to be brave.  We all go through things in life.  If you’re middle aged or above and you haven’t gone through a life crisis where you thought the whole world was going to come tumbling down.  If you haven’t been through that, just buckle up because it’s coming.

 

KATRINA MADEWELL: Suck it up, roll up your sleeves, put on your big girl panties, whatever it takes.  Just get your stuff in order.

 

DARRIN T. MISH: Some of us have been through that multiple times.  The great thing about that is very few people die from these kinds of things that they think are going to be the end of the world.  You could have a terminal illness or something like that.  That’s not what we’re talking about.  We’re talking about a financial crisis.  We’re talking about…

 

KATRINA MADEWELL: It’s not going to kill you.

 

DARRIN T. MISH: …a divorce.  Which I’m sure is quite traumatic.  We’re talking about things that can be dealt with.  You just have to face it and deal with it.  The other thing is that people fall into depression when they know what the problem is and they aren’t actually taking any action to solve the problem.  I can talk about this from firsthand knowledge even within the past few years.  I’ve had problems that I knew I had.  I even knew how to solve them, but I was unwilling to do the work to solve those problems.  So we have to think about that as human beings, we have to think about I feel depressed about this problem I’m having in my life.  Now, why am I feeling depressed about it?  What is the deal?  Is it because I literally don’t know what to do?  Or is it because I know what to do and I’m just not willing to put in the work to do it?  I think that’s something that…

 

KATRINA MADEWELL: And you can even go further than that.  Are you scared of the outcome?  Sometimes that might be what paralyzes people, don’t you think?

 

DARRIN T. MISH: Yeah, there’s a great book I wish I could remember the name.  It was written by the bald guy that did the future weapons show.  He was a former navy seals.  His last name is like Makowitz or something like that.  And he talks about how even the navy seals in the last decade have really become modern day American heroes.  We kind of imagine these guys jump out of airplanes, swim under water, blow things up, kill people silent and are never afraid.  He talks about in the book quite a bit about how those guys are scared every moment they’re on a mission and what they’ve learned how to do is channel that fear into positive action and momentum.  I think there’s something…there’s a life lesson to be learned there.  We all have times in our life when we’re actually almost paralyzed by fear, but you have to figure out what your goal is and keep pushing through the goal so you can finish your mission which is to accomplish your goal.  11:08

 

KATRINA MADEWELL: When you think about that you think, who doesn’t want to be happy? Sometimes if you can just focus on the end result, a lot of times that will get you where you want to go.  What can I do right now to make it where I need to be tomorrow?

 

DARRIN T. MISH: I don’t think we’ve ever talked about this on the show, but one of the things that I’ve done many times in my adult life is I’ve written down goals.  I’ve always written down big, hairy audacious, crazy goals.  Just write them down on a piece of paper.  Make 5 of them or 10 of them and do some goals in every area of your life.  Physical, financial, professional.  Write those things down and every time I’ve done this, I’ve put the goal…some people would preach, read those goals every day and I think that would be a very good practice.  What I’ve done is I’ve written them down and put the piece of paper in a desk drawer and forgot about them.  All conscious thought is gone and removed from the goals and then I’ll find that list of goals 2 years later, 3 years later, 5 years later and I look at the goals and I’m like, wow, I didn’t just accomplish all those goals, I smashed those crazy big audacious goals.

 

KATRINA MADEWELL: It’s a proven stat, though, just the time to think about it and write it out even if you throw it in a drawer like you were saying, what you talk about you bring about.  So even if you throw that in the drawer, it still finds its way into the atmosphere.

 

DARRIN T. MISH: Yeah, it finds its way into your psyche if you’re a motivated person.  If you’re the kind of person who’s going to write down some big hairy audacious goals like I want to make $10 million a second and then you never put any…you never take any conscious steps to make that happen, that’s not going to work.

 

KATRINA MADEWELL: It’s a as simple as I’m going to walk 10 miles, or I need to go 10 miles from point A to point B, yeah that might be a big goal, but how are you going to get there?  Are you going to take a train?  Are you going to walk?  Are you going to ride a bike?  There’s a lot of ways to get there, some are faster than others, but the point is you have to start moving in that direction. If you don’t move in that direction, you’re never going to get there.

 

DARRIN T. MISH: Right, so applying this to if you have an IRS problem, let’s say you owe 100 thousand dollars to the IRS and you haven’t filed a tax return in the last six years.  Well then you need to write down a goal that I want to somehow get my IRS problems settled and then you have to start trying to chunk down the steps that you need to take to get that done.  If you don’t know how to solve the problem and I wouldn’t expect you to, Katrina, what do you think some of the chunking down would look like to solve that problem?

 

KATRINA MADEWELL: Not doing anything.  Frozen.  That’s what I would think, if you don’t know how to chunk that down, if you’ve never been taught that.

 

DARRIN T. MISH: What I’m saying is you might want to go ahead and think about o.k., maybe I should do a little google research on how to solve an IRS problem.  Maybe I should find out how I can get old tax returns done if I don’t have any records.  Maybe I should try to find out some people who had either been in this problem before or have handled these kinds of problems before.  So my point in explaining this is not that you have to learn how to solve the problem, but you have to figure out some small chunky step to getting to that goal.  Lots of times I’ve written down goals and I’ve really had no idea how I’m going to get what it is I want.  If you just try to take a step regularly in that direction, somehow that all seems to work out.

 

KATRINA MADEWELL: You have to listen to my Saturday show, it’s all about that.  You’re going to love it.

 

DARRIN T. MISH: So tell us a little about that show.

 

KATRINA MADEWELL: The guy’s name is Joshua Smith, he was listed as NAR which is National Association of Realtors 30 under 30, really hard to make that cut and he has this company called GSD Mode and GSD stands for Getting S-with an It Done Mode.  He is hard core, goal-driven.  He’s one of the people you talk to and you feel motivated and exhausted after you talk to him.

 

DARRIN T. MISH: Awesome.  I think it’s time for a break.  When we come back we’ll talk about how to get those goals accomplished if you have an IRS problem or really any other problem you’re dealing with in life.

 

Commercial Break

 

DARRIN T. MISH: Welcome back to the IRS solution attorney show.  I’m your host Darrin T. Mish.

 

KATRINA MADEWELL: and I’m your cohost, Katrina Madewell.  Welcome back to the show.

 

DARRIN T. MISH: Right before we left for the break we were talking about goals and how to solve problems in life and accomplish things in life by the use of goals.  I think it’s important to note that if you don’t write down a goal, if you don’t have any goals you’re just going through life kind of…you’re going to let life happen to you.  There’s something magic about writing your goals down.  If you have an IRS problem, maybe the goal looks like I’ll have my IRS problem completely settled by some date in the future.  Then you just have to take regular daily action steps to try to make that happen.  You just have to move in the right direction.  You just have to move in a positive direction.  Maybe one of those action steps is to call me.  Maybe it’s not.  Maybe it’s to call the IRS.

 

KATRINA MADEWELL: Maybe it’s to take 15 minutes and search google for something.

 

DARRIN T. MISH: Yeah, maybe it’s to do a google search and get a little bit of research.  Maybe the solution or next action step is to buy a $12 book on Amazon.  Or maybe it’s to go on Amazon and get some of my free stuff.  Or go on my YouTube channel and watch…I’ve heard people say they watched 4 or 5 hours of me explaining how to solve IRS problems, which sounds like a nightmare to me.

 

KATRINA MADEWELL: You’re going, man I couldn’t watch 4 or 5 hours of that.

 

DARRIN T. MISH: Maybe it’s just getting comfortable with the outline of how you’re going to solve your problem.  What we’re talking about really applies to all of life’s challenges and we all have challenges.  Whether they’re from how to pay the rent, how to pay the power bill, how to get your kid into that college of their choice.  Whatever it is, we all have challenges, but if you don’t make goals and if you’re not goal-oriented than you’re most likely not going to achieve what you want out of life.  That’s all we really have to say.  That’s the topic of the show today is make some goals, don’t let life happen to you.  If you’re depressed it’s probably because you’re not moving in the direction of goals that you haven’t even stated yet.

 

KATRINA MADEWELL: I like just taking simple little action steps to get you moving in that direction.

 

DARRIN T. MISH: Yeah, if you take coordinated action, small steps towards a stated goal, in no time you’re going to be so much farther along than you ever could imagine.  This doesn’t sound like rocket science to me, but if you’ve never experienced this, this is pretty profound stuff.

 

KATRINA MADEWELL: It might be the person listening hasn’t.

 

DARRIN T. MISH: Yeah, it probably is and I hope there’s at least one person that’s listening that really takes that to heart and sets some goals to solve some of the challenges they have in their life, the things that are really keeping them down.  Take some small action steps to make things happen.  It’s worked.  It’s a time proven throughout decades.  Throughout centuries that that works.

 

I think we have some questions from listeners that we need to answer, Katrina.

 

KATRINA MADEWELL: Yes.  Let me read this.  I’m looking.  Let me back up, I think I’m getting ahead of myself here.  Number one, the first question we got was.  Wait a minute.

 

DARRIN T. MISH: I think I have it here.

 

KATRINA MADEWELL: Do I have the wrong…

 

DARRIN T. MISH: I have it, it says, John wrote in on Twitter and he asked most of the money I earn comes in from ach payments from clients.  Those are like the automatic check debit kind of deals.  Should I be worried that these can be garnished or levied because of the back taxes that I owe?  Will the IRS contact my clients or just garnish the money from my bank account?  Wow, there’s a lot of stuff going on in that question.  Well, if John owes a significant amount of money to the IRS and the IRS has issued him, meaning sent him, a certified letter called a final notice of intent to levy, nowadays that letter is going to say LT-11 in the upper right hand corner.  They used to be letter 1058, for decades it was letter 1058 and had a certain format.  In just the last year or so they decided to change the headline on the letter, change the letter number, change the verbiage, change the format and basically disguise it from us so we didn’t automatically file appeals when these things came in.

 

KATRINA MADEWELL: I was going to say, what’s that all about?  But it sounds like you just answered that question.

 

DARRIN T. MISH: Yeah, it’s just to keep us from filing so many appeals because appeals cost IRS more money to resolve than doing nothing, so I think that’s what that’s about.

 

KATRINA MADEWELL: Probably want to work out those details.

 

DARRIN T. MISH: So if John had gotten a final notice of intent to levy and he didn’t file an appeal and more than 30 days have gone by then yeah, he’s subject to potential levies.  Now what’s a levy mean?  You just got to think about the fact that levy means seizure. Anytime you see the word levy it means potentially the IRS could seize your stuff.

 

KATRINA MADEWELL: Take.

 

DARRIN T. MISH: Yeah, take.  They’re both 4 letter words right?  Levy and take.  So they could levy his bank account.  If they levy his bank account, what does that mean?  Well, if they levy the bank account, the bank has to seize, take, the money that’s in the account on the day that the levy is processed.  They have to hold it for 21 days and then turn it over to the IRS.  So if the IRS gets really lucky and I have lots of stories where clients had 40 grand in the bank and the IRS just got really lucky, they get the money, unless you can convince them within the 21 days to give it back.

 

KATRINA MADEWELL: And this is a one day thing.  One day swoop.

 

DARRIN T. MISH: Bank levies are one time things.  That doesn’t mean they can only occur one time.  It just means they’re not continuous and they’re not supposed to be successive.  It’s not supposed to be where the IRS issues a levy and then they issue another one in a week.  Let’s say they always issued it on the first of the month, that would be successive levy.  It would also be a punitive levy.  IRS is not supposed to do successive levies for bank accounts.  And they’re not ever supposed to do a punitive levy.  What’s punitive mean?

 

KATRINA MADEWELL: Yes, you’re getting all legal on us.

 

DARRIN T. MISH: Punitive means it shouldn’t be punishing.  The IRS role is not to punish transgressors.

 

KATRINA MADEWELL: Somehow I have a feeling the general population does not believe that to be true.

 

DARRIN T. MISH: I’m not saying it is true or not, I’m just saying they’re not supposed to issue punitive levies.  I’m not saying I’ve never seen it a punitive levy.  I have seen some punitive stuff.  But remember, the executive branch, going back to high school civics.  We have 3 branches of government, the executive, legislative, and the judicial.  Executive branch’s job, and the IRS is executive branch, their job is to enforce and carry out the laws that are passed by the legislative branch.  If there is a violation of these laws, then the executive branch then gives away to the judicial branch who does the punitive stuff.  Who punishes the bad behavior.  A lot of times the IRS gets ahead of itself and jumps straight to the punishment part and that’s not really what they’re supposed to do.

 

So John could be worried about a bank levy. I think that could be a very real possibility for him.  But even worse, typically a revenue officer who is a person who works at the IRS who handles individual cases, he’s basically a bill collector on steroids.  A revenue officer can issue a levy to the source of revenue for any business.  Let me give you a real estate agent context so that you can kind of get a… It’s really common.  Real estate agents are my single largest profession that I represent.  The way you guys get paid and the way the industry is.  What they would do to a real estate agent is they would issue a levy to the broker, directing broker.  Hey broker, all monies that you owe real estate agent, give them to us until she’s paid.  This is very harsh, right?  What are you supposed to do in that case?  Really, a levy like that is not so much about collecting the money.  That kind of levy is about getting your attention so you come in out of the cold and start dealing with the problem.  Going back to the thing we were talking about in the last segment, right?

 

KATRINA MADEWELL: How does that relate to John as well?  When he gets payment by ACH, how do they…what did you just say again?  The revenue officer….?

 

DARRIN T. MISH: Can issue a levy to the source of the…to like the payers.

 

KATRINA MADEWELL: All the payers?

 

DARRIN T. MISH: One of the things that can happen is if the revenue officer gets a copy of all the accounts receivable then he can actually issue levies to all the people that pay a particular business. Let’s say John had a lawn care business and somehow the revenue officer got a list of all the customers and he sent all the customers a levy notice saying, hey instead of paying your monthly lawn care bill to John, just pay it to us until we tell you to stop.

 

KATRINA MADEWELL: How real is that that really happens?  How often do you see that?  That seems like it would be a lot of work for the IRS.

 

DARRIN T. MISH: This is an advanced thing.  It doesn’t happen to your typical person who hasn’t heard from the IRS.  This is going to happen to a person that’s been dealing with the revenue officer and the revenue officer is either super aggressive or the taxpayer hasn’t been very cooperative with the revenue officer.  But I’ve seen it many many times.  What happens in these cases, it’s kind of interesting and what I would have predicted if I didn’t have any experience in this area, and that is the payers simply don’t pay.  They don’t pay the IRS.

 

KATRINA MADEWELL: Yeah, well think about that.

 

DARRIN T. MISH: They don’t pay the business.  They just stop paying.

 

KATRINA MADEWELL: Think about that your lawn guy, Joe Smith, who might have been your lawn guy for five years and all of a sudden you get this letter from the IRS and you’re going…what?  I don’t owe the IRS and don’t pay Joe Smith and you’d be like, yeah.  I would think that was a scam.  First thing, I would be like, what the heck is this?

 

DARRIN T. MISH: I’m in this business and I’ve been doing this for 15 years.  If my lawn guy, if I got a levy notice that said don’t pay your lawn guy, pay the IRS, I’d just get a new lawn service.  Honestly.

 

KATRINA MADEWELL: Why?  He’s a client, Darrin, you should call him and help him.  What’s the matter with you?  I’ve got to retrain you, don’t I?

 

DARRIN T. MISH: If he was my client, obviously, I would take care of that.

 

KATRINA MADEWELL: But that’s the point, your lawn guy now is going to be your client if he got that notice.

 

DARRIN T. MISH: The funny thing is, I think my lawn guy actually does have an IRS problem, but he’s one of those people that’s not going to deal with it until it happens.  Hopefully nobody can figure out who does my lawn.  Maybe he’s gotten it fixed.

 

KATRINA MADEWELL: I finally found those Twitter questions.

 

DARRIN: Ok, good for you!

 

KATRINA: We got another one from Lisa.  She says, “Is it possible to stop garnishments being made by the state of Florida for money I owe them for taxes?”

 

DARRIN T. MISH: This is a really interesting question because we don’t have an income tax in Florida, so the only kind of taxes that you can owe the state of Florida are probably either corporate income taxes or sales taxes.

 

KATRINA MADEWELL: Or child support, right? Wouldn’t that be the state, or no?

 

DARRIN T. MISH: No, it’s not a tax.

 

KATRINA MADEWELL: But they’re saying garnishment…I’m trying to figure this out.

 

DARRIN: So, short answer “yes”.  There’s going to be a way to stop any garnishment.  If you can demonstrate it’s causing economic hardship, which means you can’t afford to pay for life’s necessities, like food, clothing, shelter, medical care, transportation, education, things like that.  Then you’re going to be able to get a garnishment stopped.  I don’t know enough about the facts and the details in Lisa’s case, but it’s probably going to start with either finding a lawyer to help you with that, or simply calling the state of Florida and talking to the person in charge of your particular case and explaining to them that in lieu of a garnishment, you would much rather work out some acceptable payment plan so that you would not have an economic hardship in your life.

 

KATRINA MADEWELL: If you have questions, try to send some more detail so that we can actually answer those in detail.  Not these one-liners because they’re a little hard to answer, right, Darrin?

 

DARRIN T. MISH: Yeah, for sure.

 

KATRINA MADEWELL: So the Twitter handle real quick in case…and you can follow and direct message.

 

DARRIN T. MISH: It’s Darrin underscore mish.  That’s D-A-R-R-I-N underscore M-I-S-H.

 

KATRINA MADEWELL: Or 888-GET-MISH.

 

DARRIN: 888-GET-MISH.

 

KATRINA MADEWELL: We’ll be back in a minute.

 

(Commercial Break)

 

DARRIN: Welcome back.  I’m Darrin T. Mish your IRS solution attorney.

 

KATRINA MADEWELL: And I’m your cohost, Katrina Madewell, welcome back to the show.

 

We have another question before we dive back into the next session.  Clarence had another question, I think this came from Facebook.  He said I’m unsure where to get the federal tax forms I need.  Is the post office still the best place to get them?  That’s a pretty good, basic question.  I like it.

 

DARRIN T. MISH: So, unfortunately I find myself in the post office several times a week usually standing in line and…

 

KATRINA MADEWELL: So people can still pick up tax forms in the post office?

 

DARRIN T. MISH: No, actually.  In most post offices there are no tax forms.  And you can’t get them at the library, that’s the other place we used to get them back in the old days.  The best place to get tax forms is actually on the web at irs.gov.  They don’t do a lot right, and the government has already demonstrated that they don’t know how to build very good websites, based upon the medical exchanges.  But I’m going to compliment the government here real quick. They actually built a decent website for the IRS.  The forms are on there, old years forms are on there.  Now, if you’re in a situation where you don’t have internet access, you don’t have a computer and you don’t have a printer or any variation thereof, it’s going to be kind of challenging and you might have to go into a local IRS office.  Unfortunately I find myself fin those relatively frequently too and there are some tax forms at the IRS local offices.  In the Tampa Bay area there’s 2.  There’s actually more than 2 if you count Polk County.

 

KATRINA MADEWELL: Where are their offices?  There used to be one by International Mall, but I don’t think that’s still there.

 

DARRIN T. MISH: In Tampa, there’s one on Columbus Drive, near the intersection of Columbus and Del Mavery.

 

KATRINA MADEWELL: So that is still there.

 

DARRIN T. MISH: Kind of kitty-corner to the Raymond James Stadium sort of.

 

KATRINA MADEWELL: Yeah, there’s a church or something right there too, I think.

 

DARRIN T. MISH: Ironically, some of our Tampa listeners who have been here for a while will think this is kind of funny.  Joe Redner actually owns the IRS building.  Joe Redner is a fire brand Libertarian who happens to also own most of the adult entertainment establishments in the area.  Really became famous in the 90’s because he did a public access show that involved people without clothes on.  He kept fighting the government to allow that to occur, the guy won every time he got in a fight with the government.

 

KATRINA MADEWELL: He went to jail a lot in-between, too. But, you know.

 

DARRIN T. MISH: I admire some of the stances that he’s taken just from the standpoint that he’s a strong Libertarian.  I think it’s ironic.  He must smile every month when he sees that rent money go into the bank account.

 

KATRINA MADEWELL: I went to school with his son.  I don’t know if I told you that.

 

DARRIN T. MISH: Is that right?

 

KATRINA MADEWELL: Yeah.  Since probably 8th grade.

 

DARRIN T. MISH: I haven’t heard anything about Joe Redner in a long time and he may have even passed away, I’m not sure.

 

KATRINA MADEWELL: No, no, no, he’s still around.

 

DARRIN: Oh, he is?  Ok.

 

KATRINA MADEWELL: He’s still around.  He’s helping his son Joey with Cigar City Brewing.

 

DARRIN T. MISH: Ok, and Joe is kind of, and for those of you that are listening who are outside of the area, Joe is kind of like the Tampa Bay Hugh Hefner.  Right?

 

KATRINA MADEWELL: Yes, he’s a Tampa icon for sure.

 

DARRIN T. MISH: There’s an office there.

 

KATRINA MADEWELL: That’s a great way to put it, I’m going to have to let Joey know that. He’ll love that.

 

DARRIN T. MISH: And there is an IRS office in St. Petersburg on Koger Blvd, which is off of 4th street North.  Very close to the intersection of Gandy and 4th Street.

 

KATRINA MADEWELL: Like the St. Peene area.

 

DARRIN T. MISH: Yeah, St. Peene area.  I know there’s one in Lakeland, I’ve never been to it, and I know there’s one in Sarasota.  So there’s IRS offices all over the place.

 

Somebody asked me just yesterday, they said something about, they told me a story – I went to the IRS local office and they couldn’t help me.  I kind of smiled and said yeah, the IRS sometimes is kind of like dealing with the Alice in Wonderland story.  They will routinely put out press releases that say something like “In the interest of providing better customer service, we are closing our local service area so that you can call the toll free number and get assistance.

 

KATRINA MADEWELL: Yeah, we have had to send people to the IRS to actually get their taxes stamped during the loan process.  That’s happened.  And that’s fun because most of the time they don’t want to help them and we have to send people in there crying this whole sob story to get them just to put a simple stamp and an initial on it.

 

DARRIN T. MISH: Yeah, back in the day we would send them to the IRS local offices and have those things date stamped so they could show us the receive date.  They’re not that willing to do that anymore.  So that’s sort of an interesting thing.

 

The other place that you can get them for the people that don’t have the computer, the interne, the printer or whatever, you can actually call the IRS at 1-800-829-1040 and ask them and they will send you quite willingly any forms that you need because it’s going to facilitate in getting…

 

KATRINA MADEWELL: Tax revenue.

 

So you got some good stories in the news.  This one’s an interesting one.  I don’t know how much you know about it, but it says the IRS (intangible) Surveillance gear documents reveal.  What the heck is that?

 

DARRIN T. MISH: This is a frightening story.  So sting ray cell phone surveillance gear, it’s a situation where law enforcement sets up basically fake cell towers.  So your phone, depending on the network you’re on and what not, your [hone will hit that sting ray tower and use it like it’s a cell tower.  What law enforcement is supposed to use these things for, they’re supposed to simply strip meta data out of the phone so they can identify when potentially a drug suspect or a terrorism suspect or whatnot is in a certain area and they can prove that he was in that area.  They’re not supposed to use this technology to listen to phone calls.  The reason is that they only need something called low-level court order.  It’s called a pen register, to go ahead and use these stingray towers in the manner I just described.  Where they’re just sort of verifying that a person is in the area.

 

The reason they need these very low level warrants is because it’s not really intrusive, that’s the thought behind it.  What the IRS is doing and lots of other federal law enforcement is doing, is literally on some of the hardware that they use at the law enforcement and all they have to do to listen to the phone call is plug in a headphone jack.

 

KATRINA MADEWELL: Is that a violation of some sort?

 

DARRIN T. MISH: Yeah, but I’m not sure it’s a trackable violation and also very interesting…

 

KATRINA MADEWELL: Because they’re listening and not recording?  Is that what you’re saying?

 

DARRIN T. MISH: Well, who knows?

 

KATRINA MADEWELL: it’s probably a recording too.

 

DARRIN T. MISH: Who knows, but what a federal law enforcement has told local law enforcement who are also using these things is that if local law enforcement is in danger of the use of these devices is about to be uncovered, like in a court room or through discovery or whatnot, that local law enforcement is to basically not cooperate, not use the information and basically…

 

KATRINA MADEWELL: Bail out of it.

 

DARRIN T. MISH: Yeah.  Hit the ejection button and just bail out.  The IRS, don’t you think it’s interesting and sort of questionable on why the IRS would even need these things?  I mean, there is a criminal investigative division at the IRs and there’s 2 or 3,000 agents, but the intrusiveness of the government post 9/11 and post Patriot Act.  I guess the Patriot Act was passed in 2012 as a response to 9/11.

 

KATRINA MADEWELL: Exactly, it was.

 

DARRIN T. MISH: I can remember reading the news and seeing that this thing was being proposed and saying to my wife, this is terrible.  There’s going to be this tremendous pendulum swing away from individual liberty in our country under the guise of “oh, we need this to fight terrorism.”  How on earth is the IRS using these sting ray towers to fight terrorism?  It’s so tempting, once you give law enforcement a tool, to only use it for its intended purpose.  I’m not anti-law enforcement, but law enforcement a lot of times looks at situations like an “us vs. them” mentality and they’ll do whatever it takes to get the bad guys.  That’s not what our system is based upon.  Our system is based upon checks and balances, the rule of law, we should still have strong individual freedoms in this country and it seems like we keep going down this road of collectivism and what’s best for the common good.  Those sound like really nice things until you realize that if our republic is being run like a pure democracy meaning that if the majority rules individual rights will necessarily suffer.

 

KATRINA MADEWELL: We move away from individual liberties and move a little bit more into the communist space.  If somebody else is regulating what’s being done and said.

 

DARRIN T. MISH: Not to get too far down into this rabbit hole, but the colonies…the British colonies that made up America later were founded by people fleeing Europe, Britain in particular because they were seeking more individual religious freedom primarily.  The Pilgrims were a religious sect that were being persecuted in Britain and so they split.  They left for the new world because they knew there wouldn’t be people persecuting them for their beliefs.  It’s kind of scary that we’ve gotten to this point in American society where it’s all secular humanism.  It’s what the left actually thinks is right is what we’re kind of living under right now.

 

KATRINA MADEWELL: The problem is we’ve been so free and people have the right to say anything that people take it so far left that they lose sight of the original goal and the original agenda and how our whole country was started.

 

DARRIN T. MISH: I talk about this all the time.  Individual responsibility is really the key to success. At the beginning of the show I talked about all of our problems are caused by decisions that we’ve made or haven’t made.  You can’t even solve the problem if you’re still pointing the finger at somebody else.  Maybe somebody else contributed to the problem.  Granted.  There’s usually more than one person that causes or contributes to a problem, but until you take that personal responsibility that, ok, maybe even if I didn’t solve it, but I’m going to solve it now.  I’m going to take the steps I need to now to get that thing solved.  It’s just scary that the IRS is using these sting ray things.  There probably will be another congressional investigation.  It probably will go nowhere.

 

KATRINA MADEWELL: I think there’s a lot of stuff we don’t know, but that’s another whole story.

 

DARRIN T. MISH: The Justice Department doesn’t seem to prosecute for anything anymore.

 

KATRINA MADEWELL: David Parker out of Virginia Beach, he is an owner, he pleads guilty to over one million dollars in tax evasion.  He pleaded guilty on Thursday for evading income taxes and payments.

 

DARRIN T. MISH: We talk on the show a lot about how…

 

KATRINA MADEWELL: 49 year old guy.

 

DARRIN T. MISH: People with tax problems are often worried about going to prison, it’s one of their biggest fears, and that makes sense.  If you haven’t filed tax returns, it makes sense that you’re scared because you’re breaking the law and you know that there’s potential for people to go to prison.  This is one of those stories that the IRS…

 

KATRINA MADEWELL: It says up to 8 years.

 

DARRIN T. MISH: The IRS decided to pop this guy.  I guess he was the owner of a Jet Ski kind of business in Virginia.  They decided to pop this guy because it made the news.  We’re reading this off a website up in the Virginia area and it’s made the news.  The reason it’s in the news is because it’s going to scare “x” number of people into compliance and get them taking care of their tax problems.  We’re talking about this on a national radio show here and people are going to hear about it and they’re going to get scared and they’re going to do what they need to do.  This guy, it was really pretty funny.  He didn’t file federal tax returns from 2007 to 2011.  In and of itself, not that unusual.  But he also didn’t file his business income tax returns after 2007.

 

KATRINA MADEWELL: He just didn’t file at all.

 

DARRIN T. MISH: The combined tax bill is over a million dollars.  Here’s what he did that was really probably really got him popped. He met with an IRS agent in February 2012 and failed to disclose all of his assets while indicating to the IRS that he had very little money.  Then a few weeks after that meeting, he goes to casinos in Florida and Atlantic City and he buys $50,000 in chips.  And he gets caught.   It’s not so much the failure to file the tax returns, in my opinion, that caused him to be prosecuted.  It was the lie.

 

KATRINA MADEWELL: Well, it’s a fact that he owes the IRS a million bucks and he just spent 50 grand on casino chips, they probably didn’t like that very much.

 

DARRIN T. MISH: I actually don’t have a gigantic problem with that.

 

KATRINA MADEWELL: I don’t think the IRS liked it very much.

 

DARRIN T. MISH: He shouldn’t have told the lie to the IRS because what he did is he probably motivated a fairly typically unmotivated IRS employee.  He motivated that person to prosecute him.  So now he’s going to end up, he faces the maximum penalty of five years.  He’s probably going to go do a year or two in some federal country club kind of prison.  Incidentally I’ve talked to many people who have been incarcerated in these federal minimum security prisons and they tell me they’re not nice places.  No matter what we talk about outside.  They say they’re not very nice and it’s a low point in their life.  Hopefully this guy will get it together.  There’s that saying, pigs get fat, hogs get slaughtered.  David Parker, he was exhibiting very hog-like behavior.

 

KATRINA MADEWELL: You should have filed something, buddy.

 

DARRIN T. MISH: Really should have called me, I could have taken care of it.  You definitely wouldn’t be going to prison at this point, I don’t think.

 

KATRINA MADEWELL: Don’t lie to your attorney or the IRS agent.  Wrong thing to do.

 

DARRIN T. MISH: Yeah, lying to your attorney is just dumb because we can handle pretty much any set of facts, but not as well if we get surprised.

 

KATRINA MADEWELL: CNN had another one that says the department of justice closes an IRS investigation with no charges.  What’s up with that?

 

DARRIN T. MISH: I think I just alluded to that a couple minutes ago that the justice department doesn’t seem to prosecute people anymore.  Do you remember the Lois Lerner that.  I’ll briefly talk about what was going on with Lois Lerner.  She was an IRS employee, fairly high level and she was in charge of the division of the IRS that took care of granting non-profit status.  The non-profit’s we’re talking about in this case are not the typical 501 (c) (3)’s?  They’re 501 (c) (4)’s which are non-profit’s that have to do with political fund raising.  They’ve only been legal a few years as a result of a Supreme Court decision.  What happened is right before the 2012 Presidential election, this ruling came down perhaps a year or two prior to that.  There was lots of tea party groups and conservative groups who were trying to set up these political non-profits so that they could advance their agenda.  Their agenda was to win the White House and help Mitt Romney win the White House.  What happened is the IRS, it took the IRS a very long time to approve these types of noon-profits and many of them were ultimately approved, but they were approved well after the election. There are some people who think that if these things had been approved then the election consequences would have been different.  I don’t know if that’s the case or not, but it’s really the appearance of impropriety that’s the problem here.  It’s not whether impropriety occurred or not, it’s the appearance that the IRS was being used as political weapon by an administration to win elections and to keep their political opponents down. The members of Congress did this probe and they subpoenaed her and she took the fifth and she refused to testify about her activities and stuff. It was kind of funny, it was big in the news.  She makes this big long statement about how innocent she is and then she takes the fifth.  Which you can’t really do, but she did it.  And she got away with it.  So just this past Friday the justice department notified Congress that it’s closing the two year investigation on whether or not she improperly – or the IRS improperly – targeted the Tea Party and other conservative groups.  There’s a great quote and I love this because you know I’m a small government guy, the probe found, quote: Substantial evidence of mismanagement, poor judgement, and institutional inertia, leading to the belief by many tax-exempt applicants that the IRS targeted them based on their political viewpoints.  But poor management is not a crime. Close quote.

 

You have one party of the government, pointing at the IRS, the justice department pointing at the IRS saying there’s substantial evidence that they can’t manage their way out of a paper bag.  They exhibited extremely poor judgement and there was this intuitional inertia.  Let’s break that down.  What does that mean?  I think that means that there was direction from the top to slow walk these things through. That’s what I think it says and it’s just sort of interesting that we’ve now just decided, well, the justice department has decided, there’s just not enough evidence that there was any crime.  They just suck at their jobs so we just have to live with it.

 

KATRINA MADEWELL: It’s a waste of time, we’re just going to close it.

 

DARRIN T. MISH:  Yeah, fascinating.  There’s another person and as much as I try not to make this show political, there’s another person who’s big in the news who had a bunch of emails that seem3ed to get lost and found on a regular basis and I think that this is really the justice department telegraphing that there’s nothing going to come out of that, either.  It’s just you know, sloppiness.  You can have a server in your bedroom if you have national security secrets on your computer.  It’s no big deal.

 

KATRINA MADEWELL: There’s a big delay in the time they turn stuff over. That always helps.

 

DARRIN T. MISH: I just find it frustrating because I actually do believe in government to the extent that it has limited functions and it should perform those functions very well.  We should have a strong military, we should have border controls, we should have a currency, we should have roads and bridges, we should have minimal laws that facilitate interstate commerce so we can buy a bottle of water that was filled in California where there’s a drought or whatever.  This is just…this telegraphs to us as citizens that there are two sets of rules going on here.  There’s rules for this David Parker dude in Virginia who if he doesn’t pay his income tax, he’s going to be looking at prison, and there’s rules if you work for the government or you’re part of the ruling class that don’t apply to you.  You’re exempt because you have friends in high places.

 

I want to get to the train wreck of the week here today, we’re running out of time.  This is a pretty interesting story.

 

KATRINA MADEWELL: Wait, wait for it!  Wait for it!

 

(Train wreck sound)

 

DARRIN: Our producer Jeff is a little slow this morning.  It’s a really interesting story, a very good client. He was my client for about seven years.  Talk about how long some IRS cases can take to resolve.  We resolved that one, and that’s not the topic of the IRS train wreck of the week.  He had a really good year, one of his most recent years and his adjusted gross income was right around a million bucks.  It was good for him, I like seeing people succeed, it makes me happy and he’s a good guy and he deserves that kind of money.  What happened is he actually filed his tax return a little bit late and he didn’t pay all of the taxes that he owed.  What happened is he generated a penalty of up to right around $65,000, using first time penalty abatement rules, I was able to get that completely refunded to him and he had $65,000 that he didn’t have to pay to the IRS and he was able to use on whatever he wanted.  Hopefully it was to stimulate the economy on some kind of level.

 

KATRINA MADEWELL: If you have an IRS issue, a question, or a problem, just call 888-GET-MISH and our host Darrin Mish will help you out.  888-GET-MISH.  You can also hit him up on Twitter.

 

DARRIN T. MISH: Facebook.  You can hit me up on Twitter at darrin_mish, you can hit me up on Facebook, my name or getirshelp.com.

 

KATRINA MADEWELL: Thanks so much for joining us, we’ll be back same time, same place next week.  For this week, we’re out.

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