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View Diary: Why did the IRS demand protest info from pro-life groups? (69 comments)

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  •  I have been involved in establishing a 501C(3) (14+ / 0-)

    in the past and can understand why such actions would disqualify an organization.  I can remember the application process where we had to provide demographic data proving that there was a need for our organization and that its mission was significantly different from that of other 501s in the immediate area.  (we were trying to establish an FQHC)

    It is SOP for the IRS to exercise close scrutiny since tax exempt status confers many operational advantages to a group as compared to a for profit group

    •  I also pursued the idea of (7+ / 0-)

      obtaining non-profit/tax-exempt status for a spay/neuter fund.  As benign as that sounds, the paperwork, time and money involved, to include hiring an expert, i.e., accountant/lawyer, stopped me in my tracks.

      I did spend time studying the law and composing a Mission Statement.

      It's been my sense since this broke (a year after Issa knew about it BTW) that the Baggers simply believed that they could get themselves set up as a tax-exempt organization and had no idea what was involved.  Any additional scrutiny would constitute an outrage for them.

      I find myself if not being supportive of the IRS, at least not outraged either.

      When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

      by msmacgyver on Tue May 21, 2013 at 10:40:03 AM PDT

      [ Parent ]

      •  it cost us $5000 in legal fees alone (8+ / 0-)

        and the work was done partially pro-bono.  The consultant we hired to help with the set up of the organization cost about another $3000.

        I have to wonder who is bearing the cost of establishing these 501s as the costs associated with just the set up is not chicken feed.  

        •  Exactly (3+ / 0-)

          The whining and complaining by the Baggers started over a year ago and Issa was aware of it, as I said (link to follow).

          The Baggers, RW and GOP are hoping to tie this to the IRS involvement with ACA mandate.  Just another reason to hate and distrust Obamacare.

          As I've said, I'm not all warm and fuzzy about the IRS, but I do think those involved were taking shortcuts and doing their jobs as they understood it.

          I had a run-in with the IRS last year and my acountant's firm got involved on my behalf.  It was frustrating and could have been very expensive in penalty plus accounting fees.  As it worked out, the IRS was at fault and the firm waived their fee.  Just lucky and if the Baggers had run into any kind of opposition from the IRS, their knee-jerk reaction would have been over-the-top...as it apparently was.

          When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

          by msmacgyver on Tue May 21, 2013 at 10:50:13 AM PDT

          [ Parent ]

          •  I am involved in a dispute with IRS over (3+ / 0-)
            Recommended by:
            msmacgyver, Adam B, Nova Land

            capital gains vs ordinary income over some stocks I cashed out to pay medical bills.  My attorney has told me to expect them to carry this to the federal courts because of the number of people who had to cash out stocks and bonds 2007-2009.  If the IRS wins its point, it could change how such instruments are regarded for tax purposes

            •  You have my sympathy (1+ / 0-)
              Recommended by:
              Nova Land

              Have you contacted an accountant who specializes in IRS problems?  

              After the situation with the IRS last year, the accounting firm I had been working with for several years decided to terminate our relationship.  It was a costly adventure for them and even though I had almost no input into the IRS situation and it was legitimately all on them, my accountant turned out to be a bit of a flake and this led to other problems unrelated to the IRS.  I was collateral damage in a sense; however, I went to H&R block for my 2012 return and was amazed at their levels of expertise.

              Seriously, I suggest you try H&R Block, just for a look-see which as I understand it, would be free.  My tax-preparer impressed me so much and I would trust her to sort out any problem I would ever have.  

              When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

              by msmacgyver on Tue May 21, 2013 at 11:07:54 AM PDT

              [ Parent ]

              •  H&R (2+ / 0-)
                Recommended by:
                msmacgyver, Nova Land

                I tried having H&R Block do our partnership taxes once.  I had been doing them for years and one year just didn't have the time.  After the first meeting, he put things together.  I met with him and found numerous errors and had to explain a lot to him about the forms.  After his second try, I said thanks and filed a heavily revised version of their product (I paid them and checked self-prepared on the return).   The next year I found a local practitioner that did them correctly the first time and continued using him until we incorporated.

                Your mileage may vary.

                Government can't restrict free speech, but corporations can? WTF

                by kyoders on Tue May 21, 2013 at 12:02:12 PM PDT

                [ Parent ]

                •  Partnership returns are a different animal (3+ / 0-)
                  Recommended by:
                  msmacgyver, Nova Land, BachFan

                  and most H&RB employees have never been trained to do them, and many offices don't even have the software. When I worked for the company, we had a list of return types we shouldn't even attempt, and the phone numbers of the handful of highly trained (Enrolled Agent) colleagues who would do them right.

                  That said, finding a local independent office that handles them well is also a good solution.  

                  •  I did it (3+ / 0-)

                    That's interesting.  I guess the guy at the local branch didn't know that, because he obviously had never seen a 1065 before, but said he could do it.  Ours was a pretty simple case, but I managed to figure it out and do them correctly, I think, for 5 or 6 years.  I admit that it took a lot of research, and a lot of angst, and not a few unfruitful calls to "experts."  Yet another area where the tax code needs to be simplified and clarified.  I imagine a lot of the confusing parts are loopholes designed for people using partnerships for reasons other than it is supposed to be the simplest form of doing business when there are multiple people involved.

                    Government can't restrict free speech, but corporations can? WTF

                    by kyoders on Tue May 21, 2013 at 01:35:02 PM PDT

                    [ Parent ]

                •  Absolutely...YMMV (1+ / 0-)
                  Recommended by:
                  Nova Land

                  The H&R Block rep who did my taxes was a very experienced tax preparer with many additional credits to her resume.  A long time H&R B employee, she also teaches and lectures.  

                  I got lucky to be sure.

                  When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

                  by msmacgyver on Tue May 21, 2013 at 01:49:45 PM PDT

                  [ Parent ]

              •  my current attorney is a CPA and a tax specialist (1+ / 0-)
                Recommended by:
                msmacgyver

                as well as being a member of the Bar and admitted to practice before US Superior Court.  He has been in practice almost 50 years and has been my attorney/accountant for the last 30 years.  So far, I have no problems with his advice

                •  That's encouraging...you didn't (0+ / 0-)

                  sound as if you had a lot of confidence in your attorney with this post:

                  I am involved in a dispute with IRS over
                  capital gains vs ordinary income over some stocks I cashed out to pay medical bills.  My attorney has told me to expect them to carry this to the federal courts because of the number of people who had to cash out stocks and bonds 2007-2009.

                  When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

                  by msmacgyver on Tue May 21, 2013 at 01:53:46 PM PDT

                  [ Parent ]

                  •  it is a lack of confidence in the IRS to admit (1+ / 0-)
                    Recommended by:
                    msmacgyver

                    their audit was wrong and they misidentified the funds in question as ordinary income instead of capital gains.  We have submitted a library of paperwork refuting their position but I understand about 20 other local farmers are having similar problems with the IRS over what constitutes capital gains vs ordinary income (caveat: this involves land law and what disposal of fixtures to the farm qualifies as capital gains and which qualifies as ordinary income)

                    We have already whittled their estimate of amount due by $20,000.

                    •  Yes, getting the IRS to admit to error (0+ / 0-)

                      is what happened in my case, too.  And, it was what eventually got my accountant/tax preparer in over her head.  She simply could not deal and a more senior person was assigned to my case.

                      In the meantime, I continued to receive very scary notices from the IRS despite my being assured by the accounting firm that "everything is being taken care of" and other emails to that effect.

                      I think there is a certain kind of "civilian" who can deal with the IRS culture and for those who simply cannot, like my original tax preparer, it can only go from bad to worse.

                      When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

                      by msmacgyver on Tue May 21, 2013 at 02:58:29 PM PDT

                      [ Parent ]

                      •  I am getting the scary notices and they are (1+ / 0-)
                        Recommended by:
                        msmacgyver

                        garnishing a part of my SSDI payments.

                        •  I am so sorry this is happening to you (0+ / 0-)

                          From what I could gather, the local IRS people my accountants were talking to were simply pushing paper and not trying to solve the problem.  Some of the gibberish I was told was just that...gibberish.

                          Can you offer to make a settlement with the IRS?

                          When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

                          by msmacgyver on Tue May 21, 2013 at 07:37:45 PM PDT

                          [ Parent ]

                          •  it is my position that there is no need for a (1+ / 0-)
                            Recommended by:
                            msmacgyver

                            compromise as the legislation behind the termination of the No Net Cost Program and Tobacco Stabilization Program was explicit how the buy out would be treated tax wise.  The IRS has changed the rules without any sort of legislative change as far as our research indicates

                          •  I wish you success with this (0+ / 0-)

                            My penalty would have been in excess of $6,000 and like you, I would never have conceded.  

                            When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

                            by msmacgyver on Tue May 21, 2013 at 10:11:23 PM PDT

                            [ Parent ]

                    •  I'm confused (0+ / 0-)

                      Your earlier post says your dispute involves the dispostion of stock.

                      "Well, I'm sure I'd feel much worse if I weren't under such heavy sedation..."--David St. Hubbins

                      by Old Left Good Left on Tue May 21, 2013 at 03:38:23 PM PDT

                      [ Parent ]

                      •  it is a picky point governing the Tobacco Buyout (0+ / 0-)

                        Program where tobacco companies bought out growers' allotments and retired the Tobacco Stabilization program.  Allotments were in units of pounds and payment was a certain amount to growers and a certain amount to landowners.  For those of us who were in both categories, we received both types of payments but a proportion of each payment was allocated to capital gains since the allotments could be bought and sold the same as stocks or land while the amount allocated to growers was purely ordinary income.  In 2009, the IRS stopped treating these blended payments in accordance to the legislation that governed this program and instead treated all payments as ordinary income (including a 20,000 lb allotment that I purchased from a farm that was being converted to a development.  They refused to recognize that I had any basis in the pounds at all)

        •  Link/excerpt to Issa info (1+ / 0-)
          Recommended by:
          entlord

          http://www.huffingtonpost.com/...

          "I knew what was approximately in it when we made the allegations about a year ago. This is one of those things where it's been, in a sense, an open secret, but you don't accuse the IRS until you've had a nonpartisan, deep look. That's what the IG has done. That's why the IGs in fact exist within government, is to find this kind of waste and fraud and abuse of power."

          Issa, according to an aide, asked the IG for an investigation last spring, after hearing allegations of selective targeting of conservative groups. The IG told him in a letter this summer that he was looking into it.

          The groups singled-out were applying for nonprofit status as "social welfare" organizations, a loophole that allows political groups to conceal donors and accept unlimited contributions.”

          When someone is impatient and says, "I haven't got all day," I always wonder, How can that be? How can you not have all day? George Carlin

          by msmacgyver on Tue May 21, 2013 at 10:52:23 AM PDT

          [ Parent ]

      •  I suspect Rove? someone was teaching TP'ers this (0+ / 0-)

        I have to believe that there were seminars, webinars, meetings, at which local TP groups were instructed how to form a 501c4 and how wonderful it is as a vehicle for circumventing all that nasty disclosure-and-limits stuff that the mooslim nazi Federal Election Commission makes you do.

        It's no different than the industry that's teaching Romney wannabees how to stash money in offshore bank accounts and IRAs stuffed with penny stocks that magically mushroom the next nanosecond into gazillions of dollars. People do not come up with these ideas on their own; there's a promotion team.

        And guys, if you are trying to avoid being classified as a political party, using the description "Party" in your name doesn't seem like a particularly smart move.

        •  We have those trainings as well. (1+ / 0-)
          Recommended by:
          Adam B

          There are occasional workshops put on for progressives seeking to set up non-profits.  Nothing nefarious about explaining the process to people and advising them on how to properly comply with the law.

      •  I don't think they're that bad at all. (1+ / 0-)
        Recommended by:
        Eyesbright

        its a bunch of yes/no boxes to check, projection of finances, and a description of the org.  that's about it.

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