Tag Archives: IRS audit

Letter to Congresswoman Carolyn Maloney sent August 1, 2011

18 Aug

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Letter to Congresswoman Carolyn Maloney sent August 1, 2011

I live in Israel. Marylouise Serrato of the ACA suggested I contact you as I believe I am being unjustly treated by the IRS.

My wife and I, in our latter years, I being 70 and Nancy 67, have been selected “at random” by the IRS for a compliance research examination for the tax year 2008. I was sent a seven page Form 4564 listing all the documents required for the audit. I must also fill out Forms 9209, 9211 and 9213 providing appropriate certified translations of each document.

We maintain dual citizenship and have been full Israeli citizens since 1992. We file and pay income taxes to the US every year. We also pay Israeli income taxes every year and have owned our house on Moshav Evan Menachem for the last 13 years. It is quite clear that we are eligible for the Earned Income Exclusion and that, even if we claim our gross earned incomes from my medical work ($28,743) and my wife’s farming work ($50,691), without reduction for expenses, we do not exceed the maximum allowable Earned Income Exclusion for the tax year 2008.

They want proof of our Israeli residency, which is in Hebrew. The want all the documentation regarding all expenses claimed on the Schedule C of our self employment endeavors, which, obviously also is in Hebrew and, according to the tax compliance officer, requires “Certified Translation.” All these translations entail a huge amount of work, time and expense to complete. Needless to say, our earned income, even if you don’t reduce it by business expenses, does not exceed the maximum earned income exclusion for 2008. We have always paid the self employment tax (social security) based on this earned income.

I feel that this total audit is unfair because the IRS has no representative in Israel. We deal with the office in Puerto Rico. They have no one who can read and understand Hebrew. If they want to review all this documentation they should provide a means of their understanding it such as an IRS officer in the Embassy here. I really have been depressed and distraught over this whole affair. I believe that it caused my acute appendicitis, which occurred three days after receiving the notification of this audit. I have even thought of taking my own life.

I turned to the Tax Advocate Service for assistance and they requested that the IRS carry out a limited/focused audit instead of the all-inclusive compliance research exam. The request was denied by the IRS. After that, the Advocate said they could not help me any more and closed my file.

Can you help me in any way or refer me to anyone who might be able to influence the IRS to at least carry out a focused audit? Can you draw this to the attention of someone in the IRS who might be able to help?

Thank you for anything that you try to do.

Author’s addendum: This inquiry was not answered as of this date