IRS Sends Me a $16,165.03 Bill

I got four letters from the IRS today. I had been starting to wonder: They hadn’t sent me anything since .

These new letters sum up my total unpaid taxes for , , , and (I didn’t owe any taxes in , and I don’t have any outstanding balance for earlier years).

They don’t have any of the bombast, boldface, or exclamation marks of previous letters. Indeed, they’re almost apologetic: beginning with the passive-verb phrase “We are required to send you this notice…” (We wouldn’t bother you, but somebody made us.)

The letters give a careful tally of how the interest charges have accumulated during different periods as the interest rates have fluctuated, but they give no accounting of the penalties, which also accumulate over time in parallel.

Oddly, the “total” interest is shown in two separate places in all but one of the sets of letters, and the numbers do not agree with each other. Okay for government math, I guess.

The notices also don’t show their idea of the original unpaid balance. So, in short, they are a little difficult to interpret.

If you’re curious, here’s what they’re after me for (at least according to some of their incompatible figures):

Tax YearTax+PenaltiesInterestTotal
Total$14,907.36$1,257.67$16,165.03
2007$4,258.97$780.37$5,039.34
2009$1,513.58$124.91$1,638.49
2010$4,704.32$257.42$4,961.74
2011$4,430.49$94.97$4,525.46

I called up the IRS this afternoon and asked them to send me their transcripts for those four tax years in the hopes that they will have more complete figures. I have long suspected that they’re calculating the penalties and interest incorrectly, and the funny numbers in their letters add to my suspicions, but I haven’t ever sat down and done the calculations myself. Maybe I will.

I’m hesitant to get in an argument with the IRS about math of all things, but on the other hand if I do have a valid legal complaint and their software really is too inept to calcualte penalties & interest correctly, that might gum up their works pretty severely — I’m reminded of how the hero in Brazil stops a couple of vindictive government workers in their tracks by asking to review their “form 27b-6” — which worked about as well as Dorothy throwing water on the witch.

browse«»
Find Out More!

For more information on the topic or topics below (organized as “topic → subtopic → sub-subtopic”), click on any of the ♦ symbols to see other pages on this site that cover the topic. Or browse the site’s topic index at the “Outline” page.