One for you, 19 for me....

[captainsblog]

Wow. Lots of weird dreams last night.

I was on a plane that almost crashed two blocks from the house I grew up in. Before that (or possibly after), I got into wicked arguments with Dennis and Jim, two of my best friends in the world. Oh, and I got notice of an income tax audit.

Oops. That last one really did happen yesterday. First time in half a century I've been considered significant enough to audit.

It's a relatively minor inquiry, as these things go. My self-employment schedule shows what, apparently, is an above-standard deviation amount deducted for "legal and professional expenses" in 2007 and 2008. Understandable; to comply with one set of rules (of the state ethics variety), I cannot have electronic debits for federal court filing fees deducted directly from my trust account, so I leave those funds in my regular account and then have the filing fees debited to the Visa debit card I have for that purpose. That means I need to book the total amount received as income and then deduct the filing fees under that pesky category.

The filing fees for business reorganization cases are much higher, and so, because '07 and '08 each included at least one Chapter 11 filing, those debits, and thus my deductions for them, went higher for those years than prior ones or even last year (when I took over somebody else's Chapter 11 but didn't pay the filing fee for it).

The revenue officer sounds reasonable; I asked if I needed to pull out all of the dozens of actual filing receipts, which I keep in the case files, or if the bank statements showing the $299/$1039/$274 debits would be sufficient. She suggested the same compromise I would have: I will provide a full sample for a three-month period, and just the bank statements for the rest of the two years being looked at.

I tend to be honest to a fault when it comes to this kind of shite- hell, I deposit (and pay income tax and FICA on) cash that clients give me- so I don't think it's going to be much of an inquisition. At least that's not what I expect.