no it does not. the irs rules about trading are very clear and very well documented. there are few grey areas. for there to be an 80k mistake something does not add up. i think the op is only telling us part of the story.
Well, as soon as the op finds out, the op will post it. From the preliminary findings, this is 'apparently' from 2008's return. All I can imagine is the irs thinks (or has found. sigh...) that there was more income in 2008 than what was reported. I make an ok living, but 97k MORE IN TAXES??!?!?!?! I'm in a paperwork mess as we speak trying to figure this mess out... Gonna be a long evening.
Damn IRS. Don't get too excited until you hear back from your accountant. Of course, you should have some idea in the back of your mind if there was income offset some how that might make such a large liability possible. If not, it's probably just some error that can be easily discovered. Act fast to get back to them though. It seems like they like to start attaching tax leins on real estate and bank and other cash accounts. Good luck with those blood suckers.
Thanks bro! It may very well be 1099 income. It's looking like one of the guys I did some work with in 2007, and 2008 JUST NOW FILED HIS RETURN(s) AND turned in a 1099 that I didn't know about. We made some pretty good money, so this could be it. He turned in one 1099, but we also worked on a sizable wealth transfer case that he didn't turn one in on UNTIL RECENTLY!!!!!!!!!!!!!!!!!!!!!!!!!! (Yes, my fault for not knowing.) IF this is the case, I will formally apologize here on ET
so you thought since there was no 1099 reported you would just forget that income? that sounds like tax evasion to me.
Well, if that turns out to be the case you can at least argue to get out of the interest and penalties since you didn't see a 1099. Just don't ignore any communication from the IRS, though. Ignoring the IRS usually ends badly. Good luck.
it happened to me once: a huge tax bill out of nowhere. the reason was that i shorted 40K worth of ETF in Dec and covered it in Jan. but the sale was reported on 1099 and messed up cost-of-basis or I messed it up when filling. just replied to their request with the letter explaining what happened and that was the end of it. i maybe actually called IRS as well to explain the situation, can't remember now. **edit** skimming through the thread i notice now that my situation is different from that of OP. gonna leave it here in case it is helpful to somebody else.