Journal 4 – The IRS Fines Me then Forgives Me

I spent Friday and Saturday (Jan 31 and 1 Feb 2015) working on my taxes.  After 20 hours, I’m done with them.  I need to wait until mid month to ensure I have all the 1099s.  Then I’ll mail them in, but this year I’m using registered or tractable mail.

Last year I didn’t use tracking and the IRS said I did not submit my return for one of my LLCs.  I guess it was Murphy’s Law kicking in:  The only year I didn’t use tracking and the Internal Revenue Services looses my forms.  To be fair, it could have been the U.S. Postal Services, but it was the IRS that wanted to fine me.  Nice!

The IRS Fines Me

Without trail or proof, the IRS is allowed to charge me with the “crime” of not filing forms.  Essentially, they assumed I was trying to avoid paying my company’s taxes.  Other Federal crimes require a Grand Jury indictment; and as far as I can tell the U.S. Constitution hasn’t been appealed.

The presumption of innocence isn’t in tax law.  I’m assumed guilty and have to prove my innocence.  For my “crime,” they were going to charge (fine) me $1,200.  But, since I’ve been on time in the past, they waved the fine.  Whew!  How about that?  No jury trail.  No facts.  Just them levying a fine and then forgiving my transgressions.

I think it’s time to do away with the income tax and the IRS!

I would prefer to go back to the original U.S. Constitution when it comes to taxes, but since the “progressive” era (President Wilson to FDR to today), we’ve been a tax and spend nation.  So if we’re going to be “progressive,” why not have a flat tax or, even better, a Fair Tax?  Seriously, check it out:  Fair Tax.

Why I Do My Own Taxes

I originally wanted to complete my own taxes for three reasons:  First, given all the receipts I collected this year, it would have cost me about $500 to $600 for a bookkeeper to organize them; Second, I wanted to understand how taxes work, so I can comply with the law and take advantage of the “write offs” Congress set into the law; and Third, I wanted to save an additional $2,000 to have an Accountant prepare all my taxes.  I did my business taxes on H&R Block’s Premium package, which I purchased for under $50.00 on Amazon.

I recently left a mining partnership and the partners wanted to use an accountant.  I don’t believe we get our money’s worth.  The company has been dormant for a few years and the accountant bill is still between $500 to $700.  I’m not sure what he does?

New Goal

I’d love to have the revenue to justify a bookkeeping and accountant sometime this year.  I’ll include that as one of my operations goals.

Projects Update

I’m currently working on the Start-Up Guide.  As I write it, I am also building the business plan for Project 2, Flat Free MLS.  I’m hoping to have the majority of the plans completed before February 15th.  I’ll then start constructing the Flat Fee MLS web site and implement the plan afterwards.

With regards to Project 1 , House Flipping, I’m currently upgrading the bathrooms and hope to list it on the MLS this month.  I want to have a deliberate plan for house #2.  I did all the work to fix up house #1.  Next time, I plan to use sub-contractors to do most of the work.  This should move the project on more quickly.  For House #3, I’d like to recruit investors to see how that works.  Isn’t that called, synergy?

I’m also checking out potential projects for Project 3.  At present, I’m considering an Amazon market place business.  I’d love to get your thoughts on that project.  If you want, Tell me what you think about that business, leave a comment below.

Talley Ho!

Nick

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