Taxable...
I've got a project that I've been helping a friend work on for some years now. I'm not the first person to help him with this project. The first person had to quit the project and that's when I agreed to help out. I really don't do too much work on it anymore so I don't think about it. Until today.
I received a call from the first person to help (let's call this person "FPtH" from here on out). I haven't spoken to this person in about eight years when I first transitioned onto the project, so it was weird enough just talking to FPtH at all. Apparently, when FPtH started the project, she helped my friend set up a PayPal account to accept payments for various and sundry items. What I didn't realize was that FPtH, in order to expedite the process of verifying the PayPal account, used her own name and social security number under the umbrella of my friend's company name to get it up and running instead of just the company name and business ID.
I'm sure you see where this is going.
FPtH received a letter from the IRS saying that she underreported her income by several tens of thousands of dollars over the last eight years. They found a PayPal account registered to her name and SSN with a lot of transactions over the last eight years. Since it also had my friend's company name attached, that's how she knew to call me. She had completely forgotten about it and, when I reminded her about the account, realization set in like an anvil on Wile E. Coyote's head.
Why it took so long for the IRS to figure this out is one thing. Why FPtH set it up this way in the first place is another thing altogether. Why my friend didn't know about it is yet another.
Luckily, I'm not responsible for anything here. I gave PayPal the proper business ID number and everyone is now going about their merry way.
But, damn, if I wasn't laughing. Hard. And into the phone. I had to apologize to FPtH for it as well. I felt bad. But not too bad, apparently.
Just bit of misinformation and BLAMMO! The IRS comes calling, albeit years later. Hope FPtH gets it all straightened out in the end.
Posted by: Marty Mankins | Saturday, 25 January 2014 at 02:23 PM
I hope so too.
Posted by: kapgar | Saturday, 25 January 2014 at 02:30 PM