Friday, August 20, 2010

Surviving an IRS audit (Reminiscing)

 My husband and I spent our first year of married life renovating a two family home that we had purchased as an investment.  My husband was a high school teacher at the time and I was working part time and taking some graduate courses.  Needless to say, money was sparse.  We were lucky enough to live upstairs (two family home) from my in-laws who charged us a below market rent.  Ambitiously, we put every dime that we earned into renovations, hoping to make a quick profit.  It was tough, but also an adventure as we did ALL of the work ourselves.  We came home exhausted every day and lived on pasta and peas... (really, it tastes pretty good).
Just as we were putting the house on the market, a letter from the IRS arrived in our mailbox.  We were being audited!!  Oh my gosh, what did we do wrong??  I was in a panic, especially being such a youngster at 24 yrs old.  There was not much that we could do to prepare.. all our receipts were in a large shoe box..and it was stuffed to the hilt.  I remember that day clearly.  We gave the agent our shoe box and sat there as she meticulously added things up.  We were 50.00 off from our tax return.. an amount that was insignificant to the IRS... whew!  No fine, no additional tax!  At the end I asked the woman why we got audited and this is what she said. "We could not believe that you both would be able to live on the money that you earned less the money that was claimed as expenses!"
 I remember those words now as I struggle to live a "rich less" life...and I don't even have to eat pasta and peas because it's cheap.. I eat it because it's tasty!
pasta with peasImage by vigilant20 via Flickr
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