My horrible IRS experience… Part 1
Everyone has probably heard about the $8,000 in tax credits that are available to first time home buyers, right?
Right.
Ok, so I am a first time home buyer. I would like to get these tax credits, right?
Right.
I filled my amended tax return in June, do I have the $8,000?
No.
Let me start from the beginning…
We bought our house at the end of May. It needed some work (namely a completely new roof and new electrical line coming in), but we were ready to tackle it. We got a little bit of a discount from the previous owners (in the form of seller concessions), but we had to pay a good portion of it ourselves. The roof was going to be the worst part, it would turn out to be about $5,400 out of pocket.
Alright, sounds fine. Especially when there is this great tax credit being offered by the government for first time home buyers. We don’t have the money right now, but we can get this 0% loan (for 6 months) to cover it now, and we can make those payments until the money from the government arrives.
The roof needed to be done, it leaked, and it needed to be replaced a few years ago. We didn’t want to spend all of our savings/emergency money to cover it, so we opted for the loan.
A couple weeks after we bought the house (June 9th) I filled out the IRS amended tax return - Form 1040X - and the First Time Homebuyer Credit - Form 5405. I sent it in a week later (around June 15th) - the IRS received it around the 22nd.
Sounds all good, right? Wait a little while, and I should get a shiny check for $8,000. I could pay off the rest of the loan, and a bunch of stuff we had to buy in preparation for the baby.
Except, no. I received a letter from the IRS a few weeks later (letter dated July 6th).
“The First-Time Homebuyer Credit is not available until a home has been purchased. The date entered on the Form 5405 indicates you plan to purchase the home in the future. We cannot allow the credit until after you have acquired the home. Please resubmit your claim at that time.”
Shit! What? Did I fill out the form wrong?
I immediately looked at the PDF copy of what I had sent in (and boy am I glad I had that copy), and I became pissed.
Part 1, Section B: Date acquired: 05/29/09
Well, Since I didn’t even send the paperwork in until mid June, I have no idea why they said I was in error. I read the rest of the letter and called up the 1-800 number they provided for if I had any questions.
I was on hold for a long time. A very long time. For those of you who don’t know, the hold music at the IRS is pretty shitty. It’s classical, but it skips.
Anyway, eventually I got through to a very nice man. Lets call him Bob from Oakland.
Bob listened to my explanation, and did a little digging. He was able to bring up a copy of the forms that I submitted and agreed with me that the IRS was in error. He put me on hold for a little while to figure out what to do.
When Bob came back, he had a game plan. He told me that they had screwed up, and he would like to refer me (I still don’t know exactly to where), but I didn’t make the credentials that usually warrent a referal - but he would try. He recommended that I submit my paperwork again, with a note explaining the error the IRS had made, just in case his manager kicked back the referal.
Bob was a very nice guy. To be honest, I was actually extremely impressed with the customer service I received while on the phone.
So, the next morning I printed out the PDF copy of the form I had, hand wrote a note saying something to effect of “I own the house, the date has always been right. It’s past May. Gimme my money you little bastards”. Ok, maybe not that last bit, and I sent it in - again, with the proper paperwork included.
I got a response from them so quickly from the first submission, I figured I’d hear something pretty quick for the second. I waited til August. No news.
I decided it was time to call the 800 number again, and figure out what was going on.
This time I got Steve. Steve was also a very nice guy. I started off explaining that I had called before, I had filled a return, and I was wondering what was going on.
Steve looked into my file, and said “Well, we only got your amended return a few weeks ago, you’ll need to wait a while before it will be totally processed”.
Hold on a minute Steve. This was my SECOND submission. I want you to look some more at my file.
He did. He looked into it some more and noticed that my previous submission file had been closed out by some woman (not Bob). He realized that shouldn’t have happened, and put me on hold so he could figure some more things out. When he got back, he told me that he linked the two claims, and got approval from his manager to pass it on to the Taxpayer Advocate System. Fancy title. They would be getting back to me within 7 business days.
…8 business days later…
I called the 800 number back. This time I got Billy. I asked if I should just give him my information so he could bring up the file, but he said I should just tell him the story. 5 mins later: “Ok, What’s your information?”
(insert facepalm here).
Now, Billy turned out to be one of the best guys I talked to. Billy told me much of the same, but let me know that my file is one of the most poorly handled ones he’s seen. That made me feel good, almost proud.
Billy was about to say he wasn’t going to be able to do much for me, but I mentioned for the first time that this was causing me financial difficulty.
Immediately Billy decided to refer me again to the Taxpayer Advocate System, but this time he also gave me their number. Told me it was probably too late to call that night, but I could try Monday (it was a Friday). I told him I’d call after we hung up to at least find out their hours.
Billy apologized to me several times and wished me luck. I hung up and called the Taxpayer Advocates.
PS: The Taxpayer Advocates have the same shitty hold music as the IRS Customer Service people.
I actually got through that night, and I talked to a guy, we’ll call him Mike. Mike was a nice guy, and I told him my story. He asked for my information and I gave it to him. He was able to give me a pretty good background of how my file had been passed around. Mike said I might just have to wait a little while longer before an advocate could help me, since now the filings were taking 3-4 months to complete (previously 6-8 weeks), and mine wasn’t outside of that window yet, since my second filing was the date considered.
I decided to say the magic words - in fact I said them randomly, and not even in a sentence.
“Financial Hardship.”
“Excuse me sir?”
“I don’t know, but I was told if I say those words you’ll listen to me.”
Mike started listening, asking for how I was having a financial hardship. I explained that the money was going to help pay for the repairs on the house that I had a loan taken out for. I explained that we had made our budget, and we were ok for now, but without that money we would start to go into the red.
By the way, apparently financially planning, and knowing that you will be going into debt a month or two ahead of time isn’t “Financial Hardship”, you have to go into debt first before you can call it that. Yeah, fuck you government.
Anyway, Mike did say that if I asked him to - he could get me assigned to an Advocate immediately, even though he warned that I don’t make the qualifications. He said he felt I was not being handled well, and it could help, but at the same time the Advocate might not agree. In the end it was the Advocate’s decision, not his, to determine if they could help.
I told Mike, that I had send in the paperwork in June - the 2nd filing was because I was told to by the IRS, and that it wasn’t fair for my second filing date to be considered as the date. He looked more into it and said, that he felt maybe it would be worth the Advocate taking a look. An advocate should be in touch with me within 3 business days.
…4 business days later…
I hadn’t heard from the Advocate, so I called the number I was given by Billy again. This time I got Joe.
Now, at this point I was not a happy camper. I feel bad because I was a little short with Joe, but he was also a little short with me. Eventually I got Joe looking at my file, and he told me that I was assigned to an Advocate, and I should be getting a call shortly. Joe also apologized after looking at my file, saying it was poorly handled. Joe decided to give me my Advocate’s name, and his number.
Thank you Joe.
Joe told me my advocate would be in his office 7:30 - 4:30 Monday - Friday.
I called my advocate, we’ll call him Jimmy. Jimmy didn’t answer at first, so I left a voice mail explaining the situation. I thought I was screwed, but it turns out Jimmy actually called me back. He got information from me and told me he would look into it. He read parts of my file to me, and he said he would need to get copies of some paperwork from various IRS offices around the country (mostly places that I had called previously). He told me the whole process would take a while, since there was something still being transfered to the Fresno office. I asked him how long this would take, he told me it depended on if they audited me or not. Since I made less than $10,000 last year (yay being a grad student), my file would likely be flagged for closer examination for fraud. But, he told me, he would get back to me by the end of September.
End of September? ARE YOU FUCKING SERIOUS. FUCK YOU JIMMY.
I politely asked if there was anything I could do to speed things up, and he told me no.
I hung up, and decided I would call him again in about 2 weeks (which was the 7th), he told me paperwork was being looked at in the Fresno office, but nothing had been figured out yet. He told me he would get back to me by the end of the month with any information if any came by.
So, here I wait. I still don’t know the real status of my filing, and nobody really seems to care. It’s frustrating because I know if I owed THEM money, things would be moving a lot faster. I also am frustrated because THEY screwed up, and are taking their damn time fixing it.
Look, I know I’m not financially as screwed as many other people in this country, but it shouldn’t take this long to get this figured out. I am counting on that money to make sure I don’t run into financial problems in the next few months (the roof payment alone takes a big chunk out of the money we have to spend - and that was supposed to be paid for by this credit). The fact that I’m not already in debt means the IRS will take its damn time sorting this out.
The only good part about all of this is that apparently I am supposed to get the $8,000 plus interest. We’ll see if that actually happens.
As nice as that interest would be — does anyone have any ideas on how to make this get sorted out sooner?
