IRS is Holding me for Ransom!

[rmackie6661]

We'll I met with the State dept. guy today and it's a good news bad news situation. Mostly bad though. He's a newer guy that doesn't really know whats what. Anyway I will be paying state sales taxes from now on and buyers of my stuff have to pay the 6.5% sales tax as well if you're from MN or come here to pick it up. (boy that wont kill the sales at all!)
He made me go through all the records that I have which was only ebay and paypal and figure out what I owed since 2004. UUGGHHH If you've never gone through paypal records one by one let me tell you its really (not) fun!
Turns out I owe about 705.00 total for the four years so I quess it's not too bad. But now I have to register for a business in MN and do the annual tax return for this once hobby of mine. Jeez I really wanted to do that let me tell you.

The two and only good aspects are that I don't have to pay the tax at auctions anymore and the IRS will be cutting me a check every year for business loses. I put way more money into this so called business than I ever profit.

My outlook right now is grim but we all have our ups and downs. Luckly My bud chris and phet here are good on the spirits. Maybe I'll just go burn up another Pole Position to releive the strain.

My advise to all of you who do sell a bit is to tax it in your states so this doesn't creep up on you and kick you in the asses. Especially my friends here in MN, the land of 10000 taxes!

 

[hucklebuck73]

Man sorry to hear all that at the very least you have a great out look of the whole situation and of course you can always go drown your sorrows with Chirs and Phet...LOL I guess you could burn a PP but I wouldnt recommend it...LOL good luck man..Jake

 

[rmackie6661]

Thanks Jake Very kind words sir.

 

[jbuck]

Ummm, maybe I'm a bit out of the loop regarding your situation, but how did this all come about anyways?

 

[teckkev]

If you don't mind the $705 then it's over and done with. If you didn't have the $705 for 4 years of taxes, I would debated the sales of the games as 'yard sale' type of sales. You got a fresh prick who just got his CPA license and wants to start making a name for himself, (tears) he's after me little heart. lol. As you stated, little paperwork each year, but tax exempt from auctions and arcade part suppliers. $705 for 4 years = to ? a year?? If you made over certain amount, state can put tax claims on the sales then. Federal can't get crap from you. Why is it IRS is fighting for the state? State department has their own tax agents. I need to sleep on this one.. Unless you just bowed down to him, I'm trying to figure out why he insisted you are an official business or acting as one. If you don't mind, give me your sales totals for each of the 4 years. If you don't want to pay the $705, let me know.

 

[Phetishboy]

Ross, I am still at a loss on all this. You need a place to hide out from the Feds when you are on the lamb, though, and the Blue Nile Lounge and Electronic Amusement Parlour will accommodate you and your lovely wife. To keep your spirits even higher, free K-Y and footlongs are standard fare at the 'Nile.

 

[Leinhit]

You left out how it came about? usually something came up and flagged for their attention...

** I for one welcome our alien taxing overlords... I surely and willingly will act as an ambassador when the pending democratic take over will unleash their fury upon us.. hoping for a small consideration for myself???

 

[teckkev]

You left out how it came about? usually something came up and flagged for their attention...

** I for one welcome our alien taxing overlords... I surely and willingly will act as an ambassador when the pending democratic take over will unleash their fury upon us.. hoping for a small consideration for myself???

I for one have no problem paying my share of taxes. Everyone has a responability as a citizen to pay the respected government offices their dues (even though funds are misused). I don't like government and state to manipulate taxing laws to collect more money for the coffer. That is why court system has pro. and def. to tell the jury their interpertation of the law. Until lawmakers write the laws to be exact, justice and tax laws will be abused, manipulated to keep the legal system in a mockery.

 

[rmackie6661]

You guys are wise in your ways. This all came up one day I was in the garage finding some parts for Phet and chris and I got a phone call asking for Arcade Sales and Repair. This is the name I put on a business card to give out to local buyers of my games with just a phone # thats it. This guy started to go into the whole you need to register as a business and are subject to sales taxes and fines. BLah Blah blah. And we need to get together and do an audit.

First off I never declared to anyone that I was a business and or due this work as a business. It is a passtime hobbie of mine done from my own garage. I would say just like most of us that turn non-working games into working ones and either keep them or not that; We enjoy doing this and don't feel it's a occupation. I have a full time Firefighter/paramedical to pay the bills. The arcade aspect which totals income of sales 8000.00 and purchases about 10000 for the last year. I don't see the reason that they would be fighting to audit this. They won't make any money in the long run.

Tekkev Hell no I don't really want to pay the 705.00 if I don't have to but the question is should I just do it and get it all over with. the average tax for the last two years for in state MN sales tax was about 325.00. Which isn't too much. But that will be taked onto my local pickup customers.

What are your thoughts on this you really know what you're talking about.

And Phet thanks for the invite. The wife already has both of the required items to attend your parties. She's awesome! Hope the parts will work for you. (PS I'll need to charge a 6.5% tax on those) J/K

Ross...

 

[Leinhit]

You just had a card w/ a business name on it, bascially for fun? you never registered your business name?

here i got a business name.. for my hobby farm stuff... but declare it on taxes every year... worried someday I'll get the 'call' too... i do very very little.. raise a few cows at a time to keep and sell the meat.. and a little mini stud horse for stud service...

I m with ya.. it sucks...

just thinking if you never registered a business name.. then why couldn't you say you were just funning around ?

and when asked.. tell them you had no sales or buys... the only record was the one you provided...

 

[p1899m]

If I am not mistaken you mentioned that the income from this hobby that they are claiming you owe taxes on are based on ebay and pay pal records. Just wondering but did they take into account your arcade related purchases that were ebay and pay pal related as well as any credit card purchases of arcade related items that you have bought for your own collection? You say you spend more on the hobby than you make which I am sure of but did they take into account only the money you made or did they at least factor in the money you could prove you have spent as well?

 

[teckkev]

If I am not mistaken you mentioned that the income from this hobby that they are claiming you owe taxes on are based on ebay and pay pal records. Just wondering but did they take into account your arcade related purchases that were ebay and pay pal related as well as any credit card purchases of arcade related items that you have bought for your own collection? You say you spend more on the hobby than you make which I am sure of but did they take into account only the money you made or did they at least factor in the money you could prove you have spent as well?

I left a reply, but i got the error page

In a nut shell here are the facts:
1) IRS is cool on this, they do not want any money.
2) we all cheat taxes. If you have a yard sale and make $30, you are required by tax law to claim it.
3) There is no such thing as write-offs for sales tax. You are basically escrow between buyer and state.

Only thing you could do is claim as additional income and then use your write-offs. Problem is, that is more of a federal feature than state.

Whoever it was that turned you in, I hope they drown in a freezing lake!

 

[rmackie6661]

[quote

Whoever it was that turned you in, I hope they drown in a freezing lake!

[/quote]

Yeah Apparently they can't tell me how they found out about me. My guess is someone here in the area with a carrot stuck up their ass. I hope they do he same also there's lots of lakes to fall into here in MN.
I think I'll just go through with the payment and get it done with and not have to deal with it anymore this year.

I sure wish I could find the SOB that gave them my generic business card! Those were only for local buyers to call me if they had any issues with their games. Well I won't be giving those out anymore.

 

[chris25810]

Hey Ross,
I've got a pair of cabs and a 4600 tube waiting for you, are you around tonight? As a bonus, you can have the mouse piss pad(Ladybug)if you fancy the aroma it gives off.

 

[TexasHotshot]

It's not impossible that YOU gave them the business card.

 

[mspaeth]

Anyway I will be paying state sales taxes from now on and buyers of my stuff have to pay the 6.5% sales tax as well if you're from MN or come here to pick it up.

He made me go through all the records that I have which was only ebay and paypal and figure out what I owed since 2004.

Wait a sec... is the $705 for unpaid *INCOME* tax, or unpaid "SALES* tax?

 

[rmackie6661]

Wait a sec... is the $705 for unpaid *INCOME* tax, or unpaid "SALES* tax?

[/quote]

Mark thats what I came up with for the period of jan 1 2004 to current, MN sales only it came up to about 10800.00 for the total and our tax is 6.5% so that's where I got the 705.00 due.

 

[shardian]

Those were only for local buyers to call me if they had any issues with their games. Well I won't be giving those out anymore.

That's what you get for going above and beyond the call and being nice to people.
Look at it this way, at least they aren't taking all your games away while claiming you are running an arcade out of your home and violating zoning laws.

 

[rmackie6661]

Those were only for local buyers to call me if they had any issues with their games. Well I won't be giving those out anymore.

That's what you get for going above and beyond the call and being nice to people.
Look at it this way, at least they aren't taking all your games away while claiming you are running an arcade out of your home and violating zoning laws.

Yeah If that happened You'd hear about something bad happening here in St Paul and I would be on my way south of the border.

 

[gamegrid]

Those were only for local buyers to call me if they had any issues with their games. Well I won't be giving those out anymore.

That's what you get for going above and beyond the call and being nice to people.
Look at it this way, at least they aren't taking all your games away while claiming you are running an arcade out of your home and violating zoning laws.

Yeah If that happened You'd hear about something bad happening here in St Paul and I would be on my way south of the border.

They do have the Mall Of America up there... If you want to take out some of your anger at society.

Anyway, it is screwed up and it is pretty obvious that the state probably paid more than $700-some-odd dollars to enforce their tax code on you. That's pretty pathetic, in my opinion.