DARRIN T. MISH: Good morning this is Darrin T. Mish, your host of the IRS Solution Attorney.
PAT GEORGE: Wait who are you guys?
KATRINA MADEWELL: I know. He’s letting the cat out of the bag.
PAT GEORGE: Strangers, I have strangers in the studio this morning. Didn’t know I had to get to know you guys all over again.
KATRINA MADEWELL: So the back story about what Pat George is talking about is you know it’s summer time and so… and I also go quarterly, I go to San Diego quarterly which is ironically where Darrin is from, and so I had my business trip combine with vacation so we pre-recorded a couple of shows shhhh.
DARRIN T. MISH: We even prerecorded some of those shows in a different studio, in a different county even.
KATRINA MADEWELL: I know, isn’t it funny.
PAT GEORGE: I had to stay here to play them and monitor the phone calls and so I got no summer vacation.
DARRIN T. MISH: And so the board just blew up right on those recorded calls.
PAT GEORGE: When do I get to go on my vacation.
KATRINA MADEWELL: Whenever you want Pat. I’m sure Roxanne will fill in for you.
PAT GEORGE: Ok bye bye.
DARRIN T. MISH: Speaking of which if you have a question and you want to ask a tax problem-related question gives us a call at 888-404-1010 that’s 888-404-1010.
KATRINA MADEWELL: Because we are live in the studio today and we can take those calls.
PAT GEORGE: I have questions.
DARRIN T. MISH: There is no way we would let this poor of an intro actually air if it wasn’t live.
KATRINA MADEWELL: That’s right. That is right because we would have already cut that out. So today’s topic is What to Do If You Get a Letter from the IRS and by the way Mr. Darrin Mish is your host and I am your co-host Katrina Madewell.
DARRIN T. MISH: Absolutely.
KATRINA MADEWELL: Pat George was right in there.
DARRIN T. MISH: So I’ve been thinking about this topic on the way over, you know, you have to ride over several bridges and what not and I was thinking that I want to say if you get a letter from the IRS well of course you just ignore it you throw it in the trash right I mean isn’t that what most people do?
KATRINA MADEWELL: That’s not a good answer Darrin.
DARRIN T. MISH: Ok you are right, that is not in fact the answer. You are not supposed to just… well what I see a lot is I see people come in with stacks of unopened IRS correspondence that covers periods of years typically and the interesting thing is since I deal with tax problems on a regular basis, I can tell what’s pretty much in the envelope by what the face of the envelope looks like. But that is not what you should do, you should not just let them stack up and refuse to open them. I think the first thing you need to do is don’t panic because not every piece of correspondence from the IRS is a catastrophe.
KATRINA MADEWELL: Be calm and carry on.
DARRIN T. MISH: Well there have been rare occasions, not common, but there have been rare occasions where I might even get a tax refund. So when you see that envelope from the IRS I know what those look like to, you should go and open those for sure.
KATRINA MADEWELL: Has it happened like people brought in a stack of mail and they are like eww this is from the IRS and I don’t want to open it there’s actually a check in there, has that happened?
DARRIN T. MISH: I’ve seen it, I’ve seen it happen. But there is something about those 3 little letters, IRS, they really scare us as Americans and I think it’s a little sad.
KATRINA MADEWELL: It’s like hide, run sideways.
DARRIN T. MISH: Or something like that anyway. So when we see those initials or that acronym the Internal Revenue Service on an envelope, it’s pretty common for people to have you know their heart starts to race and they have that lump in their stomach and it scares them so. First thing is, don’t panic . You just need to open the letter to see what it is about because sometimes it’s really no big deal. Sometimes it’s like well you know we took your refund for 2015 for example and we applied it to a balance that you had that you were on an installment agreement.
KATRINA MADEWELL: And the cool thing is to like doing the show for as long as we have we’ve produced a lot of content and a lot of that content is on your website.
DARRIN T. MISH: Absolutely at getirshelp.com.
KATRINA MADEWELL: And so I think a lot of people might be able to answer even some of their own questions like if they just open the letter is and they see what the notice is there’s probably something on your site.
DARRIN T. MISH: Pretty much every letter has a notice number or a letter number in the upper right-hand corner and I’ve worked really hard to go ahead and do videos and what not about every single kind of letter that you could get from the IRS. So Pat George is…
KATRINA MADEWELL: I think he is trying to tell us that you are also on Facebook.
DARRIN T. MISH: Yeah I am also on Facebook he can friend me at Darrin T. Mish that’s actually my personal Facebook page or we just started a new Facebook fan type page which is called The IRS Solution Attorney show and we…..
KATRINA MADEWELL: I can always tell when Pat George has something to say, always.
DARRIN T. MISH: We will be posting more and more content there.
PAT GEORGE: I’m reliving his vacation.
KATRINA MADEWELL: Oh I see.
DARRIN T. MISH: So should I share with everybody what my idea of a vacation is…
PAT GEORGE: Yes.
DARRIN T. MISH: Ok so we actually have a fifth wheel RV and apparently when I took my wedding vows with my wife about….
KATRINA MADEWELL: I hope Heather is not listening.
DARRIN T. MISH: I was going to say about how many years now… I won’t say exactly how many years now I’m going to get it right, 16 years ago apparently I promised to go to the Lake of the Ozarks Missouri every single year because there is a family lake house there and we all get together in the summer so very adventurously we drove and we’ve done this many years in a row, drove to Missouri from Florida and…..
KATRINA MADEWELL: How long is that anyway?
DARRIN T. MISH: Generally it’s about a 20-24-hour drive but we stop a lot along the way and have a good time. We usually stop and do some things on the way and sometimes many years, most years in fact we will tack on some kind of really cool family adventure on the back end. In the past we have gone to Yellowstone, we’ve gone to Grand Teton, we’ve gone to Mt. Rushmore….
KATRINA MADEWELL: That’s the way to do it like stop along the way enjoy some stuff and then you know get to your destination versus trying to hurry up and get there.
DARRIN T. MISH: So on one epic trip, we were way out west, we were in Wyoming at Grand Teton and we started talking about how far, how long it was going to take to get back home. I punched in our home address in the GPS and it says like 3 and a half days of continuous driving. I was like ok, I don’t think we are going to do that all in one sitting, actually what we did was go down to Carlsbad Caverns in New Mexico cause I have always wanted to go there when I was a kid and then we spent about 3 days driving across Texas.
KATRINA MADEWELL: What made you want to go there? What’s there, how was it?
DARRIN T. MISH: Carlsbad Caverns? Oh it’s really neat it’s this giant hole in the ground that goes down hundreds and hundreds of feet and actually you could take an elevator but what we did was we walked all the way down and it’s I want to say a couple of miles.
KATRINA MADEWELL: Wow.
DARRIN T. MISH: And there are stalactites and stalagmites and I don’t know the difference really…
KATRINA MADEWELL: Yeah one goes up, one goes down.
DARRIN T. MISH: Exactly and we had a great time so I think it’s a really good place to be one of my kids honestly because they get to go and see and do things that I never got to do which is what I think it is really all about.
KATRINA MADEWELL: What was the favorite part of your trip?
DARRIN T. MISH: This trip?
KATRINA MADEWELL: Yeah.
PAT GEORGE: Coming back.
KATRINA MADEWELL: Coming back.
DARRIN T. MISH: Yeah arriving home safely I think is probably the best part of the trip this year.
KATRINA MADEWELL: Just crazy people on the road we were talking about that how you almost got hit head on several times.
DARRIN T. MISH: Yeah there’s a lot of people who are really impatient and there is something about hauling a trailer and we all do it when we are not hauling a trailer is we’ve got to get around that guy we do it to semi drivers all the time. I think that semi-truck drivers are probably saints basically because I don’t know, I don’t know how they don’t lose their temper and just smash people.
KATRINA MADEWELL: Have to be.
DARRIN T. MISH: And you do hear about that on occasion.
KATRINA MADEWELL: Which they are certainly bigger and they could but highly not encouraged. So again our studio call in number is 888-404-1010 and Pat George is trying to mess up Darrin there flipping thru all the photos.
DARRIN T. MISH: Ok just so…
KATRINA MADEWELL: Our topic for the show…
PAT GEORGE: I see you made a stop at the fireworks outlet.
DARRIN T. MISH: So what Pat George is doing just to give you a picture since we are on radio.
KATRINA MADEWELL: I wish we had video
DARRIN T. MISH: There is a monitor right next to my face and he’s supposed to use it to send me messages about when the breaks are and things like that but what he is doing is he’s flipping thru all the pictures on my Facebook feed and I’m kind of a character on Facebook, I’m kind of a character in real life but and it’s, he’s doing it and it’s really distracting me so I just turned the monitor off.
KATRINA MADEWELL: Pat George does it every show to me intentionally just to trying to mess me up.
PAT GEORGE: I knew you were a cowboy but I didn’t know your wife was a cowboy too.
KATRINA MADEWELL: Cowgirl, get it right.
DARRIN T. MISH: Something about, it means something when your woman takes your cowboy hat I think.
KATRINA MADEWELL: Oh man I don’t want to know.
DARRIN T. MISH: Moving right along anyway back to the IRS notices….
KATRINA MADEWELL: You get a letter from the IRS don’t panic.
DARRIN T. MISH: You know typically an IRS notice is going to be about your Federal tax return or your accounts or balances that you owe. It’s going to be about a specific issue such as changes that they are proposing to make to your account. It may ask you sometimes, it may ask you for additional information. Sometimes you might have taken a position on your tax return and they just want some documentations of proof. I will give you a real common example is a lot of times people specifically in divorce situations they want to claim their children which I think is obviously their right but sometimes the IRS will ask for documentation that the child was in the home for more than 50% of the time. Happens a lot when they are step-children, different last names and non-biological children that kind of thing and the IRS is pretty hard on people and proving that they want documentary proof that the kid was in the household for more than 50% of the year.
KATRINA MADEWELL: With that being said I’ve seen a lot of times where I mean at least this is what I’ve seen from the side that I work in which is real estate, you will have like a husband and wife that are separate, or split and then they are fighting over who is going to get the child and then so what I’ve always heard is the first one to file gets the write off and sometimes you know the child may be with the mom most of that time, the dad’s filing first.
DARRIN T. MISH: Yeah those things are supposed to be handled in the divorce decree but people don’t always follow that and the IRS certainly does not go by what the divorce decree says, the IRS just basically treats it like a race, whoever claims the child first wins.
KATRINA MADEWELL: Which is insanity but…
DARRIN T. MISH: And not super fair.
KATRINA MADEWELL: They just you know, they just want it done they don’t want to make it their fight I guess. So you are listening to the IRS Solution Attorney show today’s topic is What to Do If You Get a Letter from the IRS and if you have actually gotten a letter from the IRS and you have a question on it you can call us we are at 888-404-1010 lock that number in your phone, 888-404-1010 we will be back in a minute.
DARRIN T. MISH: Welcome back to the IRS Solution Attorney show apparently the theme of the show is my vacation. It was a lot of fun.
KATRINA MADEWELL: Well you know I was gone too so he can’t just chap on you.
DARRIN T. MISH: I think it’s really just Pat’s jealous that he didn’t get to go on vacation.
PAT GEORGE: That’s a start.
KATRINA MADEWELL: We usually do fun stuff every vacation but this time we just slept, literally slept pretty much the whole time.
DARRIN T. MISH: Well that might be a sign…
KATRINA MADEWELL: Slept.
DARRIN T. MISH: Maybe you are pushing just a little bit too hard.
KATRINA MADEWELL: Watch movies, play Tetris.
PAT GEORGE: Now everyone’s playing Pokemon on the go.
KATRINA MADEWELL: I know. You know I’ve been trying to figure that out every time I try to read the articles on it I get side tracked but…
PAT GEORGE: Did you download it on your phone yet?
KATRINA MADEWELL: No.
PAT GEORGE: Don’t.
DARRIN T. MISH: Yeah.
PAT GEORGE: It takes over everything you do on your phone. It monitors everything, just not pictures, it does everything. Whatever you look at it monitors everything that’s the bad thing about it.
DARRIN T. MISH: It’s obviously a government plot.
PAT GEORGE: Yes.
DARRIN T. MISH: Obviously.
KATRINA MADEWELL: I know I’ve heard some different real estate people talking about it because I guess they have to, I don’t really understand it but you have to go to different places to get the card like it’s a modern-day version of the old trading cards?
PAT GEORGE: Yeah they have one that you have to go to Minnesota.
DARRIN T. MISH: Sponsored by the Minnesota Chamber of commerce.
KATRINA MADEWELL: Whatever. Ok if your kid is playing Pokémon or you know anything about this please call in and enlighten us because we clearly do not know.
DARRIN T. MISH: There’s already a lawyer that I’ve seen online that is advertising if you’ve been hurt as a result of somebody playing Pokémon give me a call.
KATRINA MADEWELL: What?
DARRIN T. MISH: Which I think is kind of interesting cause you know it’s going to happen right because from what I understand they have their head down even more often than usual.
PAT GEORGE: Yeah this guy on the news this morning ran into a tree.
KATRINA MADEWELL: Doing Pokémon stuff or just in general?
PAT GEORGE: Pokémon stuff yeah it said he was doing Pokémon.
DARRIN T. MISH: And I just went, this is not my area of expertise by any stretch neo-negligence but…
KATRINA MADEWELL: Do your kids play that? Are they familiar with that?
DARRIN T. MISH: No I, they are actually gone right now, I hope they are not playing it.
PAT GEORGE: This is your opportunity you are pretty much an entrepreneur you can introduce an IRS game.
DARRIN T. MISH: I could, I could in fact the problem is it would probably have to be rated for violence because that is what people would actually want. I’m not advocating violence by any stretch of the imagination I was just joking.
KATRINA MADEWELL: Oh man we like to have a little bit of fun in between but you know we do bring some seriousness to the show and so today’s topic is what to do if you get a letter from the IRS.
DARRIN T. MISH: So we went over you know a couple of things real quick, I will just recap those you know don’t panic, don’t freak out just because you got a letter from the IRS does not mean that it is necessarily bad quite often they are just administrative notices, it’s just like putting you on notice ok.
KATRINA MADEWELL: There might be a refund in there you won’t know unless you open it.
DARRIN T. MISH: There could be a refund in there. The second thing is you know it’s usually about a specific issue and it’s just going to tell you what that issue is and what changes they might be proposing to your account sometimes they are big sometimes they are not sometimes it doesn’t make any difference so you want to go ahead and open it. The next thing is you know you may get a notice that the IRS or indicates that the IRS made a change or a correction to your tax return, sometimes it means you owe more, sometimes it means you owe less, sometimes it means you don’t have any difference at all. So you just want to review that information and compare it to your original return. You know mistakes are actually pretty common on tax returns and the good thing is it’s one of those things where most mistakes can be fixed there’s very few mistakes that can’t.
KATRINA MADEWELL: So what happens if you owe less do they actually include a refund or what?
DARRIN T. MISH: If you don’t have any outstanding balances for sure they will actually generate a refund check.
KATRINA MADEWELL: There another example of a check in the mail.
DARRIN T. MISH: I think we have a call from…
KATRINA MADEWELL: I believe we do from Alice hold on let’s get her on the line. Hi Alice welcome to the show do we have you?
PAT GEORGE: Push it right on the left. Left-hand side.
DARRIN T. MISH: There she is.
KATRINA MADEWELL: I think we got her now.
DARRIN T. MISH: Ok there is something going on, can’t hear.
KATRINA MADEWELL: Alice hold on one second because hold on. Ok are you there? Alice?
KATRINA MADEWELL: Ok let’s try this again go ahead we didn’t hear you cause somehow there was a little snafu on the phone.
ALICE: Well is the people being robbed playing Pokémon?
DARRIN T. MISH: Oh yeah.
KATRINA MADEWELL: Pat is she coming thru the air or is she only in here, she is ok.
DARRIN T. MISH: So yeah I saw some news reports of people of being robbed while playing Pokémon because they are not…
ALICE: There was a young man that got stabbed while playing Pokémon.
KATRINA MADEWELL: Was this locally?
ALICE: Yes right there in Tampa.
KATRINA MADEWELL: Alrighty then.
DARRIN T. MISH: I think the moral of the story is be aware of your surroundings you do not actually fully go into fantasy land.
KATRINA MADEWELL: So what’s the idea kind of game Alice do you know anything about it.
ALICE: All I know is what my granddaughters have told me. They’re getting these little creatures that you can save up and they change into whatever.
KATRINA MADEWELL: Huh.
DARRIN T. MISH: And the goal of the game is to collect the cards, get more points and go up to different levels is that right?
DARRIN T. MISH: I did see a pizza place today or I saw it on Facebook that a pizza place actually has specials. They will actually feed, if you reached the highest level on Pokémon Go they will actually give you a free pizza. So I mean it, it’s one of these you know cultural crazes that we go through in the United States every so often where it’s just going to be a really big deal for a while and then it’s probably kind of fade off.
KATRINA MADEWELL: Yeah but what I’m curious about this one because there are some things that stay a big deal for a while, there’s some stuff that’s like hype real quick and then it goes away real quick and I’m wondering if this is not one of those things.
DARRIN T. MISH: Well we will have to wait and see.
KATRINA MADEWELL: Well thank you for chiming in there Alice if you are playing the Pokémon game or you know someone that is, make sure you pay attention and stay safe. Thanks for your call.
DARRIN T. MISH: So the next thing that I wanted to talk about is every IRS notice that you are going to get is going to have specific instructions so, in other words, is there is something that you need to do it’s going to tell you specifically what it is you need to do. It never ceases to amaze me how many people actually will get an IRS notice and the fear and anxiety that grips them grips them so intensely that they can’t read anymore. You know the notice’s where particularly difficult to comprehend it’s just something to do with the anxiety that is wrapped around the fear of dealing with the IRS just causes people to just be paralyzed.
So my advice would be just, just try to take deep breaths and read it, it might not be a big deal.
KATRINA MADEWELL: One of the things that you put on here for tip number 6 if you don’t agree with the notice it’s important for you to respond and that’s kind of a loaded question because I would think most people wouldn’t know exactly how to respond.
DARRIN T. MISH: Exactly so there is a notice that comes out called a CP2000 it’s a CP2000 and what that is it’s a proposal from the IRS to typically increase your tax liability. Most often because you have neglected to put the income from the 1099 or something like that on your tax return and before the IRS can assess that tax, assess is just a fancy word that means add the tax to your tax bill. Before they can assess the tax they have to give you an opportunity to respond and so if you get a CP1000, CP2000 one of the first things you’d want to do is obviously take it to a professional such as myself if you don’t want to handle it yourself, but if you think you can handle it yourself because it’s relatively minor and what not you are going to want to look for the deadline on the notice and you are going to want to make sure that you respond your reply to the debt to the IRS’s CP2000 before that deadline lapses and you’ve heard this many times on the show you don’t want to just go ahead and put regular first class stamp on that envelope and mail it in because it just about guaranteed quote lost if you do that.
KATRINA MADEWELL: So what does the correspondence need to actually look like can this be just a hand written letter that goes to the IRS or does it need to be typed up in some kind of formal?
DARRIN T. MISH: In the course on the CP2000 there is a place to go ahead and respond typically…
KATRINA MADEWELL: Oh so on the letter.
DARRIN T. MISH: Yeah on the letter itself it has some lines and what not and I would say that if there is more you know correspondence that is necessary I would encourage you to type it up so that it is easy to read. The biggest problem that pro-say, tax-payers have that’s tax payers that are not represented by counsel is that when you hand write something it is more difficult to read and something gets lost in the translation because people are lazy, people just don’t want to read things that are difficult to read. So I think that typing up a response is always the best idea.
KATRINA MADEWELL: The other thing I was thinking to is most of the time I would imagine that most people don’t agree with any notice that they get from the IRS right like the numbers always going to be off or they don’t think they owe the money?
DARRIN T. MISH: If I got a big refund coming I agree with the IRS.
KATRINA MADEWELL: Wow how many more times than none it’s not a refund.
DARRIN T. MISH: Well no I actually disagree with you Katrina because there are times, there’s a lot of times when you might get a CP2000 and it’s about a 1099 that you forgot and what’s there to disagree about with that you know let’s say you are an independent contractor and you work for 2 different places and you put, you only put the income from one 1099 on there and the other one was like say 3 or $5,000 something like that and you just forgot, innocent mistakes happen but when you look at that I mean what are you going to, how are you going to argue that it’s like oh yeah you are right but in that, in that example let’s say it was a $5000 1099 that you forgot about well there might be corresponding expense deductions that go along with that as well.
KATRINA MADEWELL: But you still have to refile the return right or edit it or what was it re?
DARRIN T. MISH: You would want to amend the return.
KATRINA MADEWELL: Amend it that was what I was thinking.
DARRIN T. MISH: So on the CP2000 if you straight up agree there’s a place to sign, if you straight up disagree there’s a place to sign but you want to make sure you send that letter in via certified mail.
KATRINA MADEWELL: So you are supposed to respond one way or the other.
DARRIN T. MISH: If you don’t respond you agree.
KATRINA MADEWELL: Oh alrighty then. Well I love how the IRS thinks.
DARRIN T. MISH: Isn’t that nice how they worked that out for you.
KATRINA MADEWELL: You are listening to the IRS Solution Attorney show with your host Mr. Darrin T. Mish and I’m your co-host Katrina Madewell we have Pat George back there on the board doing a great job thank you to the caller Alice we appreciate you listening to the show, when we come back we are going to continue on with our tips what to do if you get a letter from the IRS and if you’ve gotten a letter from the IRS and you got a question now’s your chance, you can call Darrin he’s the expert of this topic and he can answer it right away. 888-404-1010, 888-404-1010 you can also reach Darrin at getirshelp.com. We will be back in a minute.
KATRINA MADEWELL: Never heard that one before.
DARRIN T. MISH: And welcome back to the IRS Solution Attorney show I am your host THE IRS Solution Attorney Darrin T. Mish.
KATRINA MADEWELL: Yes I have.
PAT GEORGE: Yes you have.
KATRINA MADEWELL: Yes I have.
DARRIN T. MISH: Once we got to the chorus you’ve heard it.
KATRINA MADEWELL: Yes. Welcome back to the show.
DARRIN T. MISH: See Pat George is just like a generation or in your case 2 generations old.
KATRINA MADEWELL: Yeah maybe three, I don’t know.
DARRIN T. MISH: You know we have to get back at him when we can…
PAT GEORGE: I think I was in high school when she was born.
DARRIN T. MISH: Yeah is that right?
KATRINA MADEWELL: Well that depends what year were you in high school?
PAT GEORGE: 1973.
KATRINA MADEWELL: Oh yeah see I wasn’t even born yet. 3 generations.
DARRIN T. MISH: I was still wearing short pants. So anyway moving right along today’s topic is what do you do if you get a letter from the IRS and so far I can recap what we said, basically saying don’t panic, open the envelope, read the letter and then respond if you need to respond. You think that’s a pretty fair recap of what we’ve talked about so far?
KATRINA MADEWELL: I think so in short.
DARRIN T. MISH: And you know the next point is you won’t really need to call the IRS or visit an IRS office for most notices which is kind of counterintuitive right but most of the time…
KATRINA MADEWELL: They probably don’t want you there because it costs them more money if they have to have somebody to visit you but isn’t it a long wait anyway if you go there?
DARRIN T. MISH: Well right now the 2 IRS you know sort of offices here in the Tampa Bay area, the Tamp in St. Petersburg both of them are not taking any drop in customers period, it’s all by appointment.
KATRINA MADEWELL: So you are not allowed to just go in you have to make an appointment.
DARRIN T. MISH: In fact, in Tampa, there’s a couple of security guards that are armed with magnetometers at the front that test’s for metal and what not and they will not even let you in the door unless you have an appointment. So it’s interesting I can remember when the IRS made this big switch, they used to call those IRS serve what do they call them?
KATRINA MADEWELL: Service centers or something like that?
DARRIN T. MISH: It’s not really a service center but it was something along those lines it was for customer service and so I can remember when the notice came out this has probably been about 10 years ago, the IRS said in the interest of providing better customer service we’re going to eliminate all customer service in walk-in locations nationwide. I mean that’s like Alice in Wonderland right so I think that most people…
KATRINA MADEWELL: We on the real estate side we have seen times where the returns actually have to be stamped by the IRS cause maybe they just filed them or something…
DARRIN T. MISH: That’s an exception.
KATRINA MADEWELL: Yeah and they do, well I got to tell ya we’ve had customers go in and they’re like nope sorry can’t help you, got to make an appointment and then like what happens is they usually start crying or breaking down and somebody helps them.
DARRIN T. MISH: See I had to do that back in June for my 2015 tax return and at least I knew the verbiage right, so I knew I didn’t have an appointment oh and I brought my kids that’s kind of, I wanted to show them what the IRS was like and I think the kids actually helped because we walked up and we told them what we needed to do and why we needed to do it and they were very cordial and they were really and they went ahead and let us file the return. I can see how if you don’t know you know sort of what your rights are and sort of know how to tell them what you need and to be assertive about it I can see them turning you away because they think that you are just you know….
KATRINA MADEWELL: A crazy person.
DARRIN T. MISH: Or trying to you know get service without having an appointment like they need you know so…
KATRINA MADEWELL: But some of the things are very time sensitive like if you are in the middle of a real estate transaction where you are getting a loan that is going to be time sensitive.
DARRIN T. MISH: Yeah for sure. Back to the notices though if you do have to call the IRS for some reason there is going to be a toll-free number in the upper right-hand corner typically that tells you where to call. Now I want to caution people that are listening about this because if you’re somebody who would probably be a good client for me somebody who hasn’t filed tax returns in years or owes large amounts of money say more than you can afford to write a check for you may not want to call the IRS because in my opinion what it does is it sets the collection clock running, in other words, the normal course of how long things would take might have been longer had you not called. Because typically when you call if you have a large amount that you owe the IRS and you can’t afford to pay them they are going to give you either a 30 or 60-day deadline and then you are going to have to respond and if you don’t respond within that time parameter then the IRS collection machine is going to go into like high gear and it’s going to get worse and worse so.
KATRINA MADEWELL: You actually may ramp it up for yourself.
DARRIN T. MISH: Yeah and I had a client come in just this week that had done that, they had kind of called because they thought that was the right thing to do and what they did they just kind of set the whole thing on fire and now it’s going a lot faster than we would like it to go.
KATRINA MADEWELL: Why am I not surprised by that at all.
DARRIN T. MISH: Well not only that it’s really hard to get through to the IRS, right now on average I would say your hold times are an hour plus and then sometimes it’s really annoying when you do this for a living you will be on hold for over an hour and then a recording, you listen to really bad music, by the way, and that they haven’t changed in like 20 years. But occasionally what will happen is you will be on hold for an hour plus and you will hear a new message that says something like due to call volume call back tomorrow click.
KATRINA MADEWELL: So you hold for an hour and then they just hang up on you that’s lovely.
PAT GEORGE: Is it because of manpower or there are so busy?
DARRIN T. MISH: I think it is a manpower issue and you know Congress keeps getting mad at the IRS because of various things that are probably deserving. So they are cutting their funding which is and actually with the Obama care you know health care mandates and all those things congress keeps throwing more and more responsibilities on the IRS with less and less money and less and less manpower and so yeah of course. And the problem….
KATRINA MADEWELL: Yeah like that Obama care you have to have insurance or we are going to fine you.
DARRIN T. MISH: Yeah one of the things that’s short sided about what Congress does and I think Congress has some you know fair reasons to be upset with the IRS with regard with the Lois Lerner stuff and what not but it’s really short sided because the IRS is THE government agency that brings in revenue so if you want to decrease the deficit you know and decrease the debt I think it makes sense to give the IRS enough money to do their core functions.
KATRINA MADEWELL: It’s probably good for the tax-payers though because you are not nipping at every little thing.
DARRIN T. MISH: Could be theirs, I know the audits are down so that’s probably good for tax payers but if you are the one that’s kind of trying to budget for the country which nobody does anymore by the way, Congress doesn’t do it, the President sends like a fairy tale budget to the Congress…
KATRINA MADEWELL: We do but our government doesn’t.
DARRIN T. MISH: Yeah exactly our government just kind of operates with an open check book with a….
KATRINA MADEWELL: Oh we can just print more money.
DARRIN T. MISH: Yeah with an unlimited credit line on their credit card. But if you were the one that was trying to budget or pay for governmental functions you would think you would want to give enough money to the people who collect it to make it happen.
KATRINA MADEWELL: You know one of the things well on this list you have number 8 I’m looking always keep copies of the notices you receive with other tax records. Why would you need to keep copies of notices aren’t they like redundant and duplicate of the same thing?
DARRIN T. MISH: Ok, so sometimes they are duplicates so if you are married and you file a joint return one’s going to come to the husband and one’s going to come to the wife.
KATRINA MADEWELL: Same address right?
DARRIN T. MISH: So, I’m not telling you to keep both of those, but I’m trying to tell you to keep all of the notice sequentially so that you have them in case you do need help and you want to go to a professional it’s going to help us understand where you are in the process.
KATRINA MADEWELL: So at least open the envelope and put it in a pile.
DARRIN T. MISH: Yeah, what a lot of people do, well I’ve already said what a lot of people do, is they just come in with the unopen notices. That’s better than throwing them out or god forbid, getting little certified notices in your mail box and you know it’s from the IRS because it says it is and what most people do is they just blow it off and they never go get it because they think if I didn’t get it then they can’t possibly do anything bad to me. Wrong, you know the IRS just has to send the correspondence to your last known address and if you don’t go pick it up then it’s no harm no follow to them they don’t really care. So if you….
KATRINA MADEWELL: So what if they are on vacation we were talking about that what happens if you are on vacation and they try to send it and you are not there?
DARRIN T. MISH: Well I think typically that the post office is going to make 3 attempts over the course of about I don’t know how long is that maybe a week?
KATRINA MADEWELL: But if you are on vacation that’s… they are going to come 3 times in that week.
DARRIN T. MISH: You are right, that could happen and if it does then that’s really unfortunate.
PAT GEORGE: So they are probably never going to find you two.
KATRINA MADEWELL: I’m calling Darrin if I get any letters. That’s all I know.
DARRIN T. MISH: I think Pat might be trying to say we are always on vacation.
KATRINA MADEWELL: No, no, no.
DARRIN T. MISH: Absolutely not we are here every Thursday morning if we are not typically we are doing a recorded show right?
KATRINA MADEWELL: Yeah.
PAT GEORGE: And I got to hand it to you when you aren’t you just don’t play repeat you do a brand new show which is very admirable.
KATRINA MADEWELL: Which a lot of people do air reruns they do.
PAT GEORGE: They aren’t reruns yes they will just say you can run a rerun but you guys just don’t do that.
DARRIN T. MISH: What are you guys giving away all the radio secrets here you know we are not supposed to talk about reruns.
KATRINA MADEWELL: We don’t.
DARRIN T. MISH: Those are best of shows if you have to…
PAT GEORGE: You don’t even play best of, you do first of.
KATRINA MADEWELL: We do, yes we do.
DARRIN T. MISH: We sure try. Yeah but sometimes people get sick and things, people get stuck on bridges and things like that.
KATRINA MADEWELL: That was only once. Give me a break.
PAT GEORGE: Just one people 2 times.
DARRIN T. MISH: There was a time, there was a different time on another station that we don’t talk about that much, and it was when I first started doing the show and I’m going to admit it because it takes a man to admit this I was scared, I was scared but I was doing it and she called in and she was my lifeline she was like my phone a friend and she helped me out. She’s better on the phone then I am live so.
KATRINA MADEWELL: What? What is that supposed to mean? I know it’s a compliment but…
PAT GEORGE: Well that means that you are on the phone all day long so you got lots of experience on the phone.
KATRINA MADEWELL: Yes, that I have.
DARRIN T. MISH: I mean when you can’t be here live in the studio and you phone in that you are very, very good.
KATRINA MADEWELL: You know, I don’t know if I told you this but like my very first show here at Money talk on Fridays I was late.
DARRIN T. MISH: Well, of course you were cause that’s your pattern.
KATRINA MADEWELL: Well I was used to afternoon radio not morning rush hour traffic.
PAT GEORGE: It’s funny you say that, we’ve had like probably a handful of new first time shows and a good portion that they are always late on the first show.
KATRINA MADEWELL: See you can’t judge the traffic especially if you are not used to driving in it like if I’m going to get up and drive 5 days a week it’s like a job to come here in the morning because it takes me an hour or an hour and a half to get here.
DARRIN T. MISH: That’s true.
KATRINA MADEWELL: But Charlie filled in, he like jumped right in and I was on the phone and it was great.
DARRIN T. MISH: Charlie’s a pro, that’s why you know he’s the kind of guy that just makes things happen. Charlie’s the station manager here at 1010.
KATRINA MADEWELL: I’ll tell you, in about 15 minutes like he had my guest, I think he had all the interview questions lined up and he was ready to roll with it.
PAT GEORGE: Well (Inaudible) assistant was Charlie so you know who would have been….
KATRINA MADEWELL: I see. Now it’s at four generations is that what you are saying?
PAT GEORGE: Four?
KATRINA MADEWELL: I’m just playing.
DARRIN T. MISH: So we can be sure that Charlie will once again meet us at the studio door on the way out today. After those compliments.
KATRINA MADEWELL: We love Charlie. We are teasing Charlie but we love him we really do.
DARRIN T. MISH: For sure.
KATRINA MADEWELL: So number 9 is, be alert for tax scams.
DARRIN T. MISH: You know the IRS sends letters and notices by mail, the IRS does not contact people by email or social media or really make first contacts by the telephone did you know that?
KATRINA MADEWELL: No.
DARRIN T. MISH: So what’s going around now and it’s been going around for quite a while is typically you will get a voicemail or sometimes a live call typically from somebody with an East Indian accent, we are not making any kind of stereotypes here it’s just these scams seem to originate…
KATRINA MADEWELL: You and Heather have actually received these?
DARRIN T. MISH: Yeah these calls tend to originate in, you know India, Bangladesh, Pakistan and what they are doing is basically trying to scare people into giving them their personal information or in other cases trying to get them you know scare tax payers to give them money. We had a client before we were representing her who actually gave somebody on one of these phone scams I want to say $36,000 in iTunes gift certificates or gift cards.
KATRINA MADEWELL: That just sounds off.
DARRIN T. MISH: It makes you want to smack your head because since when did the IRS want to get paid in iTunes gift cards but it was really sad because she was a victim of that crime and it was unrecoverable because you know the money left the country.
KATRINA MADEWELL: Gone, gone. Last little tip number 10 is for more information visit irs.gov.
DARRIN T. MISH: Or you can visit our website at getirshelp.com. We’ve tried to do videos about every single notice that there is, if you happen to find you know or get some notice where I haven’t done a video I would appreciate it if you would let me know and I will do a video perfectly explaining or attempt to perfectly explain what to do if you get such a letter.
KATRINA MADEWELL: So getirshelp.com, you can also reach Darrin at 888-get-mish.
DARRIN T. MISH: That’s 888-get-mish, 888-get-mish or you can visit our website at getirshelp.com.
KATRINA MADEWELL: How does Mish translate 888-get-mish?
DARRIN T. MISH: It’s 438-6474.
KATRINA MADEWELL: Alright you are listening to the IRS Solution attorney show we will be back in just a moment we do have some questions from listeners and we will take those in just a minute.
DARRIN T. MISH: Welcome back to the IRS Solution Attorney show that’s a blast from the past that’s Welcome Back Kotter is it not?
PAT GEORGE: Yes it is. Welcome back from your vacation.
DARRIN T. MISH: So ahh.
KATRINA MADEWELL: When are you going to turn the Welcome back around? I think that’s the highlight of the show. Taking a long time to get to that part. There you go.
DARRIN T. MISH: This was the show that actually launched John Travolta do you remember his character?
KATRINA MADEWELL: Oh yes I remember John Travolta.
DARRIN T. MISH: He would say…
KATRINA MADEWELL: I was in love with him when I was a kid.
DARRIN T. MISH: The teacher would ask him a question and he would say “What?”
KATRINA MADEWELL: I don’t remember that but I remember John Travolta and Nicholas Cage, two of my favorite actors.
DARRIN T. MISH: Yeah I think he was on Welcome Back Kotter before he was on Saturday Night Fever? Right?
KATRINA MADEWELL: Oh yes I was a kid.
DARRIN T. MISH: That was the disco.
KATRINA MADEWELL: I was a kid when that show was on but I do remember it.
PAT GEORGE: And then you got all your inspiration Urban Cowboy.
KATRINA MADEWELL: So some of the questions that we have and we really appreciate your questions, we appreciate you listening to the show. If you have any you can send them to Darrin directly at he’s on Twitter @darrin_mish , you can call in or you can email him.
DARRIN T. MISH: You can email him, firstname.lastname@example.org or you can visit us on Facebook on The IRS Solution Attorney new fan page.
KATRINA MADEWELL: And we will take those questions a lot of times and bring them to the air so Jason wants to know ” If I file electronically what do I do with my W-2 forms”? I think what he means is what do you physically do with the paper.
DARRIN T. MISH: Yeah because back in the day right when we would form, you know you were working for a restaurant or whatever and you did your 1040 EZ or really any 1040 you would go ahead and mail your W-2’s with your 1040. It’s kind of hard wired in our DNA as Americans if we you know filed returns for 20 years or whatever that’s what you do right? Well, not when you E-File because the truth of the matter is the IRS already has copies of those W-2’s …
KATRINA MADEWELL: So they don’t need the paper.
DARRIN T. MISH: I know this because I get the W-2’s from the IRS from my non-filing clients all the time. So provided the employer has sent those into the IRS and the Social Security Administration then the IRS will have those.
KATRINA MADEWELL: Which they have and they did I’m sure of it.
DARRIN T. MISH: Typically if they didn’t they are going to have their own problems.
KATRINA MADEWELL: Ok so David wants to know ” I retired last year and started receiving Social Security payments do I have to pay taxes on my Social Security Benefits”? Really good question.
DARRIN T. MISH: Yeah I thought that was a really good question you know the answer is …. it depends, of course, it depends if the Social Security benefits are your, you know Social Security retirement is your only source of income then no you are not going to have to pay taxes but there are some rules here and I’m going to go ahead and tell them to you right now. You have to pay taxes on your benefits if you file a Federal tax return as an individual and your combined income exceeds $25,000. So your combined income would be your Social Security and other ok so if it exceeds $25,000 then your Social Security benefits are going to start to become taxable, at no time will you have to pay taxes on more than 85% of your Social Security benefits.
KATRINA MADEWELL: I can’t even understand why they would tax retired people.
DARRIN T. MISH: I will tell you in a second historically why what happened and if you are a married couple then your combined income cannot be more than $32,000 so I actually have somebody in my family that is on Social Security right now, he could be working but when he looks at the math why would I want to do that cause I would have to pay taxes and that’s a disincentive to be out there as an older retired person out there generating income contributing to the economy and what not he looks at the math and I got to pay more taxes then it’s worth so I’m just not going to do that I’m just going to go fishing every day. So historically what happened is there was a President by the name of Clinton who decided that it would be really cool to go ahead and tax the rich by taxing you know people’s Social Security benefits if it exceeded some amount of money and I don’t know about you but when I look at $25,000 as an individual or $32,000 as a couple…
KATRINA MADEWELL: You would be lucky to pay housing payment on that.
DARRIN T. MISH: I don’t think that qualifies as somebody who is rich so it’s really unfair because all of us are coerced, we’re forced to pay into this you know this system and then to get back the money that we’ve paid in if we are successful then we have to pay tax on it. It just doesn’t seem fair to me doesn’t make sense but it is the way it is.
KATRINA MADEWELL: That’s what we were waiting for the train wreck of the week.
DARRIN T. MISH: It’s about that time for the train wreck, IRS train wreck of the week. This is the segment of the show where I talk about somebody who came into the office as something of a train wreck, they had a disastrous situation and there’s always a happy ending. So in this particular show it is going to be a little bit different I don’t think I’ve ever really talked about this situation. You know there’s a statute of limitations for the collection of tax and it runs 10 years from the assessment of the tax and you could think of the assessment of the tax either when you file a tax return with a balance due or when the IRS just files a tax return for you and that’s called a substitute for return. In this particular case this individual was a real estate investor and had sold 3 houses as I recall and never filed tax returns and so the IRS eventually filed know as a substitute for returns for her and they came up with a tax bill over 2 tax years of a $116,955.91 now keep in mind these substitute for returns were fiction because what they did when they prepared the return is they just added up the sale price of the house as if she got the houses for free which she didn’t, didn’t happen obviously and they just multiplied by the tax rate and they came up with this giant bill and so when she came into the office and kind of told me about the scenario and told me about what tax years they were, I said why don’t we go ahead and just take, get a power of attorney for you and take a nice discreet, electronic look at your transcripts so we can see what may be the statute of limitations is coming close.
KATRINA MADEWELL: Can the IRS see that or does that kind of fall off the radar?
DARRIN T. MISH: I think they can see it I mean there is a record that I made that inquiry but there’s so many, there’s probably millions of inquiries a day so it doesn’t trigger anything in particular. It’s not going to trigger a collection action for example. I’ve been doing this for many years and I’ve never seen it trigger a collection action. So when we, when we went ahead and got those transcripts I was able to identify that the statute of limitations on at least these 2 years was going to expire in a few months so the worst thing you could do circling back to the first and second segment of the show is the worse you could do is call them at that point. What do you think is going to happen if you call them, “Hey you know I owe you like over a hundred grand you know”?
KATRINA MADEWELL: Like you said the fire will start.
DARRIN T. MISH: You know that statute of limitations is about to blow what do you say well that would be a really bad idea and so what we did is we just kind of laid low we just took no action and eventually at least on those 2 years the statute of limitations expired. Now there is a sort of interesting angle on this case so that was over a hundred almost a $117,000 that she just doesn’t have to pay.
KATRINA MADEWELL: And it was how old? 7 years?
DARRIN T. MISH: It was over 10 years old.
KATRINA MADEWELL: Ok, 10 years old.
DARRIN T. MISH: And it was actually for tax-year 2001 and 2002 but remember when they prepare a substitute for return it usually takes them awhile to get there and so that’s why in 2016 we are still here dealing with this. But there’s about another $300,000 on a little bit later tax year and it’s just got a few more months to go so it looks like she is going to get out of that as well.
KATRINA MADEWELL: So she didn’t actually pay anything to settle it you just kind of followed the rules and were able to fly under the radar and avoid it.
DARRIN T. MISH: Yeah you just follow the rules, you got to know what the law is. You got to know what to do in these situations and the worst thing you could have done in this particular situation is call the IRS and say, “Hey”.
KATRINA MADEWELL: Sounds to me like you are worth every penny you are paying. You are listening to the IRS Solution Attorney Show thanks so much for joining us today for this week.
DARRIN T. MISH: We’re out.
PAT GEORGE: I’ll be on vacation next week.