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Thread: Taxes--a minor rant.

  1. #1

    Default Taxes--a minor rant.

    It's that wonderful time of year again. Tax season. A time when a CPA is overworked, or people are pulling their hair out trying to figure out the latest wrinkle in the tax code.

    Who has a good story about the mess that taxes can create for us? I've got one to share.

    Last year, my wife and I did our joint return fairly early and tried to e-file. The IRS took our return, no problem, but the good ol' State of California refused our return and made us file by paper. Even after that, we had to call in to get our refund moving to us. Why? Someone had already e-filed a return with the state in my wife's name and SSN. That's right, a fraudulent return was filed for my wife, who is a stay-at-home mother with no reported wages.

    Lots of phone calls and leg-work from there to do: check credit reports, notify the IRS (turns out that the same person tried to file a fraudulent federal return two days after we e-filed our joint return), etc. We even went to the local police, but they wouldn't take a report unless we could show we had suffered damages. Effectively, the state lost the money, not us, so the onus was on the state to go after the fraudulent filer.

    Fast forward to this year. Getting together all the paperwork for our taxes and, lo and behold, there are two 1099-G forms from the state! One for myself and 'X ID THEFT', and one for my wife. The one for the joint return shows the correct amount we received for our refund last year, the one for my wife shows the amount of the fraudulent refund. We are supposed to claim BOTH as income for the last tax year.

    So I spent over half an hour on the phone to the state this morning. What are they going to do to fix this? One would think the most reasonable way would be to amend the fraudulent return to show that it was not my wife who received this, especially as she had no W-2 or income.

    Nope.

    They are changing the 1099-G for our joint return to show that we got a lower refund amount, by the amount that my wife supposedly received from the fraudulent return. So this balances the dollar amounts going into the tax forms this year, but it still leaves one major issue: the fraudulent return is still there! This now means that any major financial transactions (home purchase, refinance, etc.) that would review the returns are going to be an absolute mess since we have a double return for my wife for tax year 2011.

    Ah, the high level thinking that goes on in our government. So refreshing, is it not?

  2. #2

    Default

    Heh, actually i've got some pretty funny story too.

    In the last years, i mostly made the tax return for my parents (for me it's pretty useless as a student, from my part time jobs it would be... maybe 10$ and we're mostly spending the money for vacations, etc~, so i'll help). Last year i thought, that we could get more. Basically they never put in anything about their insurances (don't know with other countries, you can get a lil bit in germany, as an example from your car insurance). I took me 4 hours i guess, a lot of looking through way too much papers, etc.
    In the end, we got less back than the year before... great! =/

    Although i have to say, i didn't really check the papers yet, we still got some time left for the new ones, so i'm looking into them soon i guess, maybe something was wrong.
    But like you did already say, it's way too much trouble addressing an error the state made... In the end you're just running from place to place.
    Don't know about your current problem, i'm not familiar with it, sorry :(

  3. #3

    Default

    I once forgot to attach my W2 forms to my taxes when I sent them in. I called the IRS. I was on the phone waiting for about two minutes when someone picked up. She gave me her name, and ID#, and a case number that the call would go under. I explained the issue, she told me what form to print and fill out and send in with the W2s. The entire call lasted five minutes and her instructions fixed everything. It was delightful.

  4. #4

    Default

    Well call me Naive.. I'm still trying to figure out on what exactly all that tax money gets wasted on mostly.

    No, honestly, it's a hassle at best - here as well.. filling out the tax forms is close to rocket science if you don't want be be completely ruined by the end of the day.
    Also I think that most every government has become WAY TO BLOATED... it's a money-hungry, scheming, ever growing, hard to stop beast with just way to many heads.
    And when I just look at the pay-grades for politicians, geez... I get sick.

  5. #5

    Default



    Quote Originally Posted by AnalogRTO View Post
    It's that wonderful time of year again. Tax season. A time when a CPA is overworked, or people are pulling their hair out trying to figure out the latest wrinkle in the tax code.

    Who has a good story about the mess that taxes can create for us? I've got one to share.

    Last year, my wife and I did our joint return fairly early and tried to e-file. The IRS took our return, no problem, but the good ol' State of California refused our return and made us file by paper. Even after that, we had to call in to get our refund moving to us. Why? Someone had already e-filed a return with the state in my wife's name and SSN. That's right, a fraudulent return was filed for my wife, who is a stay-at-home mother with no reported wages.

    Lots of phone calls and leg-work from there to do: check credit reports, notify the IRS (turns out that the same person tried to file a fraudulent federal return two days after we e-filed our joint return), etc. We even went to the local police, but they wouldn't take a report unless we could show we had suffered damages. Effectively, the state lost the money, not us, so the onus was on the state to go after the fraudulent filer.

    Fast forward to this year. Getting together all the paperwork for our taxes and, lo and behold, there are two 1099-G forms from the state! One for myself and 'X ID THEFT', and one for my wife. The one for the joint return shows the correct amount we received for our refund last year, the one for my wife shows the amount of the fraudulent refund. We are supposed to claim BOTH as income for the last tax year.

    So I spent over half an hour on the phone to the state this morning. What are they going to do to fix this? One would think the most reasonable way would be to amend the fraudulent return to show that it was not my wife who received this, especially as she had no W-2 or income.

    Nope.

    They are changing the 1099-G for our joint return to show that we got a lower refund amount, by the amount that my wife supposedly received from the fraudulent return. So this balances the dollar amounts going into the tax forms this year, but it still leaves one major issue: the fraudulent return is still there! This now means that any major financial transactions (home purchase, refinance, etc.) that would review the returns are going to be an absolute mess since we have a double return for my wife for tax year 2011.

    Ah, the high level thinking that goes on in our government. So refreshing, is it not?
    Man I feel your pain.

    I do the books for several Califorina businesses. As a result I have to deal with the Califorina state & local government accountants on a regular basis. I just have to say...the State of California...is completely run by chimps on crack. I literally had to tell an accountant from the County of Orange to "shut up and take my money", because she couldn't figure out the difference between a payable and a receivable.
    You invoiced me not the other way around!
    You have a check in hand, from me, for taxes!
    Why are we having this conversation!?!?

    OK rant over.

  6. #6

    Default

    I don't mean to start a debate here, but when people need to hire other people to do taxes for them, that should be a pretty big hint that the tax code is too complicated.

  7. #7

    Default

    I generally haven't had too big a problem with taxes. I use turbotax - my tax situation isn't complicated enough for a CPA yet. There's no way I'd want to figure it out on my own without software, however.

    The only time it was complicated was when I exercised some stock options from company I work for (a startup - not successful (yet)), which might have required that I pay the AMT (the difference between the strike price and current value is considered income for the AMT - but that's a rant for another day when I'm more awake). That was a complicated spreadsheet... Since then I've figured I'll just exercise them only if they're worth something, and not try to avoid potential tax liability in the future by slowly exercising them over time.

  8. #8

    Default

    The state pulled a fast one on you. By making you claim both amounts, the state effectively "recovered" what they lost; the easy way. None of us are authorized to administer professional help here; and this is something you might need a lawyer (who knows tax code) for. Go seek out a lawyer, it's the best you can do for making your future easier.

  9. #9

    Default



    Quote Originally Posted by Entity View Post
    The state pulled a fast one on you. By making you claim both amounts, the state effectively "recovered" what they lost; the easy way. None of us are authorized to administer professional help here; and this is something you might need a lawyer (who knows tax code) for. Go seek out a lawyer, it's the best you can do for making your future easier.
    Believe it or not, I got through to the identity theft department at the state tax board (they were supposed to wipe the fraudulent return out last year). Turned out, some idiot left the fraudulent return and put down that the real joint return had the identity theft on it. Five minutes on the phone with the right person got it corrected where we no longer have to put down the refund from the fraudulent return on our taxes.

    Such a mess though, one wonders how hard it is to do things right the first time.

    - - - Updated - - -



    Quote Originally Posted by Entity View Post
    The state pulled a fast one on you. By making you claim both amounts, the state effectively "recovered" what they lost; the easy way. None of us are authorized to administer professional help here; and this is something you might need a lawyer (who knows tax code) for. Go seek out a lawyer, it's the best you can do for making your future easier.
    Believe it or not, I got through to the identity theft department at the state tax board (they were supposed to wipe the fraudulent return out last year). Turned out, some idiot left the fraudulent return and put down that the real joint return had the identity theft on it. Five minutes on the phone with the right person got it corrected where we no longer have to put down the refund from the fraudulent return on our taxes.

    Such a mess though, one wonders how hard it is to do things right the first time.

  10. #10

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