IRS Out of Control

Targets Retirees


SYNOPSIS: Mainstream media reports on how ridiculous the IRS is, implying that it is an agency out of control. We note that the same mainstream media perpetuates the misconception that the tax laws apply to all citizens rather than honestly reporting on the ongoing misapplication of law by IRS personnel, and explaining that the tax laws are limited in application to U.S. citizens living and working in foreign countries, nonresident aliens, or those involved in certain taxable occupations.

IRS NAILS 'LAVENDER HILL MOB'

By Colin Ruthven

When are lottery winners losers? When the IRS gets in on the action.

Sometimes, even though we love America, with its amber waves of purple mounted majesties fruiting all over the plains, we get a little ticked off at our government. Sometimes we find ourselves muttering" All the government ever seems to do is suck up our hard earned money and spew it out on projects such as the V22 Osprey military aircraft, which the Pentagon doesn't even want, and which tends to crash, but which Congress has fought to spend millions on anyway, because this will help the re-election efforts of certain congresspersons, who would cheerfully vote to spend millions on a program to develop a working artificial hemorrhoid as long as the money would be spent in their districts.

I mutter this frequently myself. But we must not allow ourselves to become cynical. We must remember that for every instance of the government's demonstrating the intelligence of a yam, there is also an instance of the government's rising to the level of a far more complex vegetable, such as the turnip.

Today I'm pleased to tell you the heartwarming story of a group of 10 men whose lives have been changed, thanks to prompt coordinated government action. I got this story from one of the men, Al Oliver, a retired Navy chaplain. In fact, all 10 are retirees (or, in Al Oliver's words, "chronologically disadvantaged")

The men live in the Azalea Trace retirement center in Pensacola, Fla. For years, they've gathered every morning to drink coffee and talk. In 1988, they formed a pact. Each would buy a Florida lottery ticket every week, and if anybody won, they'd all split the money. They called themselves the Lavender Hill Mob, and stamped that name on their lottery tickets.

For three years they won nothing. Then in 1991 one of their tickets had five out of six winning numbers, for a prize of $4,156. Oliver took the ticket to the state lottery office in Pensacola, where he had to fill out Form 5754 , indicating who was to get the money. He wrote down "Lavender Hill Mob".

A while later he got the form back from the state, along with a letter informing him that the Lavender Hill Mob was a partnership and could not be paid until it obtained an Employer Identification Number or EIN from (ominous music starts here)...the Internal Revenue Service.

At this point the readers are like an audience watching the scene of a horror movie wherein the woman trapped alone in the house at night is about to go down into the basement.

"NO! NO!," you're shouting to Al Oliver. "Don't get involved with the IRS! Better just throw the ticket away!"

But Oliver went to an IRS office and applied for the EIN by filling out Form SS-4. " I had to list everything on all ten forms except I believe our cholesterol count," he recalls. The IRS then gave him the EIN, which he sent along with the Form 5751 to the state lottery, which sent him the check, which he took to the bank, which after balking a little, finally gave him 10 cashiers checks for the Lavender Hill Mob members.

NOW YOU'RE thinking: "OK, so it was an annoying bureaucratic hassle, but everything turned out fine."

Please try not to be such a weiner head. Of course, everything did not turn out fine. In February, Oliver began receiving notices from the IRS demanding to know where exactly were the Lavender Hill Mob's 1065 forms showing partnership income for 1989, 1990 and 1991. So Oliver went to his CPA, who filled out the forms with zeros and sent them in.

Of course, this only angered the IRS, because here the Lavender Hill Mob was just now getting around to filing forms for as far back as 1989, which means these forms were LATE. You can't allow that kind of flagrant disregard for the law. You let the Mob members slide on that , and the next thing you know they're selling crack on the shuffleboard court.

So in June the IRS notified the MOB members that, for failing to file their 1989 Form 1065 on time, they owed a penalty of $2500. Oliver's CPA wrote a letter to the IRS attempting to explain everything. Then in July, the Mobsters got another notice informing them they owed $2500 PLUS $19.10 in interest charges, which will of course continue to mount. The notice states the government may file a tax lien against the Mobsters, and adds: "WE MUST ALSO CONSIDER TAKING YOUR WAGES, PROPERTY OR OTHER ASSETS."

That's where it stood when I last heard from Oliver. Since this whole thing is obviously a simple misunderstanding, we can safely assume it will never be resolved. The wisest course for the Mobsters would be to turn all their worldly goods over to the government right now. Because if they keep attempting to file the correct form, they're going to wind up in serious trouble, fleeing through the swamps around Pensacola, pursued by airborne IRS agents in the new V22 Osprey, suspended via steel cables from some aircraft that can actually fly.. Dave Barry - Humor - - Dave Barry is a columnist for the Miami Herald.'

[END]


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