Obama SHOULD Be on a Comedy Show If He's Talking about the IRS

Earlier this week, the President of the United States, Barack Obama, chose to give an interview.  It was not to one of the lapdog networks' lapdog correspondents, like George Stephanopoulos, and certainly was not to Fox or Newsmax but, rather, it was to Jon Stewart, whose show is on the Comedy Central network.

Comedy Central.  The President of the United States.  Yep, great country we have.

So in the course of things, Stewart got around to asking Obama something that got the president talking about the IRS.  Now, the IRS is embroiled in a heavy scandal involving their targeting of conservative-leaning groups seeking tax-exempt status -- heck, you know that.

You know that Lois Lerner, the now-retired IRS executive up to her chin in the scandal, pleaded the Fifth rather than testify before Congress.  You also assume that to be prima facie evidence that something happened for which she could be charged; otherwise she would have answered Congress candidly.  You know there was communication between the IRS and the Eric Holder Memorial Department of Justice, to figure out how to avoid getting caught.  So yes, there was wrongdoing at the IRS, and it clearly was political.  We all know that, no matter what Obama says.

However, none of that seemed to have ever been told to Mr. Obama, who laughably blamed Republicans for the whole thing.  In fact, in the course of his deflection of his own political scandal onto his opponents, he actually said this to the guy from Comedy Central:

"[The] real scandal around the IRS is that they have been so poorly funded that they cannot go after these folks who are deliberately avoiding tax payments.”

Oh it is, is it?  The IRS is actually not able to go after "those folks" who are deliberately avoiding tax payments, and it's because it is so poorly funded?  You mean it's not because their model for choosing which cases to investigate is a moronic kludge, that wastes its precious resources on stupid cases?

Evidence follows:

As I've noted before, my wife and I formerly owned a business that closed in 2013.  The business was, in fact, the nation's largest plus-size bridal salon.  In its best years it did nearly a million per year in sales, 3-4 times the volume of most salons -- but it was never profitable.

You see, access to capital dried up as soon as Obama was elected; the banks stopped lending to small business (though they kept advertising that they were, ha ha).   If you doubt that, get 5-6 small business owners in a room and ask them how many banks turned them down in the last five years.  They'll laugh, but only because it hurts.  In our case, thirteen different banks declined to deal with us -- some were candid enough to say that the president's policies made it a challenge for them to take even small risks, ones they would have always taken in previous years to help small businesses.

Bridal is a very capital-intensive business -- samples are expensive, and you need many more samples in a plus-size salon.  Capital was available when we opened, but when the White House changed, the capital market went dry as a Baptist wedding.  Ultimately, we closed the store and shut down the company, losing every last penny of our savings in the process.

Then, two months back, comes a letter to the deceased company from the IRS.  They were auditing the company for 2013, our last year, questioning an apparent mismatch between reported sales revenues and actual cash and credit-card documentation.

I'll clear this up for you in two seconds ... wedding gowns are normally an ordered item, and take 4-6 months to create and ship.  Brides typically pay twice -- half down and half when the gown comes in.  So a salon can either claim (for tax purposes) all the revenue when the order is placed, or take half at sale and half when the gown arrives.  Either is OK with accountants and the IRS, as long as you do it the same way all the time.

We took all the revenue at the time of sales.  So for a November or December order, we ended up paying tax in the year of the sale, even though we got half the payment the following year -- better for the Government, in fact.  In 2013 we received payments for the back half of a lot of 2012 sales, but stopped taking sales mid-year when we closed.  So our 2013 receipts were higher than our 2013 sales, but we had already paid the tax on those extra receipts the prior year.  Duh.

So as soon as that was shown to the IRS agent, you would think that since, you know, the president thinks the IRS agents are desperately needed to "go after those folks who are deliberately avoiding tax payments", they would have dropped the case, especially given that:
- It was obvious there was no case
- It was obvious the taxes had, in fact, already been paid
- It was obvious nothing had been done wrong
- It was obvious that the business was already shuttered
- It was obvious that the owners, a 64-year-old couple, were broke.

Nope, the IRS doesn't work that way.  Instead of doing a fast preliminary check and seeing that the salon had already paid the taxes on the revenue in question, they ordered us to provide over 300 pages of printed documentation, bank records, sales records (we no longer owned the point-of-sale system), inventory records, personal tax records (what, like IRS doesn't have our earlier filings -- whom do they think we filed our returns with, Greece?), etc.

Worst of all, though, is that we had to have the business's accounting firm represent us to the auditor.  You just don't do that yourself without "CPA" after your name, not if you want to avoid screwing up the process.  You know, if you are in a hole, stop digging. 

Accountants are not cheap, and to date they have accumulated over $3,000 in fee charges to us, to defend against a warrantless audit by the IRS, that could have -- and should have -- been dropped after the first conversation.  We will have to find money to pay for an ever-mounting accounting bill for a warrantless IRS audit.

So let me ask.  How do you think my wife and I felt, seeing the clip of Obama on Comedy Central complaining that his IRS "didn't have enough funding to go after the really bad guys?"

Nope, they can't go after the bad guys, but they can go after an old couple's closed small business from which they will get nothing, since (A) everything was done legally, and taxes were paid perfectly legally, and (B) the business is closed and its owners already lost their savings.

Let me tell you something, Mr. Obama -- don't you dare ask the taxpayers to pay one cent more to fund the IRS, until you figure out a way to set the priorities of its audit troops a heck of a lot better than they're assigned now.  You want more money?  Do a better job with what you have first.

Because they obviously can't figure out who the "bad guys" are.   Hint: it ain't us.

Copyright 2015 by Robert Sutton
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