When our oldest daughter was in college, she wrote a book. (She's smart.) Since I handle tax matters related to my books, I offered to handle tax matters related to her book. She agreed. (She's not always smart.)
As she tells the story, her mother almost landed her in jail.
Kids. They so exaggerate.
When you sell products in a state, you have to register as a retail merchant. Retail merchants must pay retail taxes. I paid my retail taxes but, in my never-ending quest for inefficiency, forgot to pay hers. What can I say? I should have had a V-8.
You'd think the state might appreciate that I was busy, that she was busy, and that everybody has far too much paperwork. They did not.
What they did do was send a snippy letter saying that if she did not pay her retail taxes, they would issue a warrant for her arrest.
I phoned the kid and told her not to worry if she heard rumors about her being arrested, as I had immediately filed her taxes and all was well. She responded by hyperventilating.
I keep wondering how all these big-name people who owe hundreds of thousands of dollars live with the stress of knowing that there are warrants on them. Maybe it's what you call a two-tiered tax system: Those who can sleep at night and those who can't.
A couple of weeks later, another letter arrived saying our daughter was still delinquent on her taxes (not true) and that a sheriff would serve a warrant.
I phoned the kid again. When I told her they couldn't find her tax payment, it was the scream heard 'round the world. I told her to have a good weekend and not let the fact that she was a fugitive bother her.
The following Monday we promptly called the state department of revenue. They assured us the payment had been received and that the second letter had been sent in error. The nice lady gave us her word that a sheriff would not be arresting our daughter and said they send those letters to scare people.
It worked.
I think of this each time news breaks of yet another high-profile celeb or politician owing back taxes. Didn't Treasury Secretary Timothy Geithner, who owed $443,000 in taxes, get a scary letter? Maybe he did and he just doesn't scare easily.
Rev. Al Sharpton and his business entities reportedly owe more than $1.5 million in taxes and penalties. He doesn't seem scared. In fact, he seems like he enjoys himself.
The New York Post recently ran a tax-weasel list of New Yorkers who owe back taxes. It was a virtual who's who of celebrities, designers, entrepreneurs and politicians. It's like being a tax cheat has become the new status symbol.
And if all your friends didn't pay their taxes, would you not pay yours?
Tom Daschle paid $128,203 in back taxes and $11,964 in interest last month. Nancy Killefer, tapped to serve in the White House and the Office of Management and Budget has had a $946.69 lien for back taxes on her home since 2005. It makes you wonder who takes the tax laws seriously.
Our daughter promptly paid $17 in back taxes, along with a $1.70 penalty. We're hoping she gets a cabinet position.
