Tax Bits: The Pink Shoes Investigations

Episode 8: Penalty Land Alex thought IRS deadlines were like curfews - you might get a scolding if you’re late, maybe a warning. What he didn’t realize is that the IRS runs its own amusement park:  Penalty Land , where every wrong turn costs real money. The rides aren’t fun. ·        Late Filing  : 5% per month, up to 25%. More than 60 days late? Minimum $510, even if you only owed a few bucks. · ...

Alex finally thought YOLO Inc had caught a break. A dividend check landed from a biotech investment, and for a moment it felt like free money - champagne corks, high-fives, the works. But with the IRS, “free” usually comes with fine print. Enter  Schedule C  of Form 1120: Dividends and Special Deductions. This isn’t about paying your own shareholders - it’s about reporting dividends your corporati...

Every startup founder thinks deductions are easy. “Just list expenses, right?” That’s exactly what Alex of YOLO Inc. thought - until the IRS turned his expense sheet into a dungeon map. Here’s the truth: deductions aren’t just write-offs, they’re traps waiting to be sprung. Salaries are deductible, but only if “reasonable.” Repairs count, but upgrades? Those are capital improvements. Bad debts nee...

Episode 5: The Inventory Heist – COGS & Form 1125-A Inventory. To Alex, it was just boxes in a warehouse with “YOLO Inc.” stickers slapped on the side. But to the IRS, it’s a math problem with very specific answers. Enter  Form 1125-A  - the Cost of Goods Sold schedule. Here’s the twist: COGS isn’t just “what you paid for stuff.” It’s a full recipe. Beginning inventory, purchases, labor, mater...

Episode 4: Show Me the (Gross) Money Revenue: the word every founder loves to flaunt - until the IRS asks for proof. This week, Alex of YOLO Inc discovers that “all the money coming in” isn’t the whole story. On  Form 1120, Line 1 , everything hinges on whether you’re cash basis (count when paid) or accrual basis (count when earned). That innocent December prepayment? Cash basis says one year, acc...

Episode 3: The schedule squad – Schedules K, L, M-1 & Friends When Alex of YOLO Inc. first opened  Form 1120 , he thought he was in the clear. Two pages. Quick work. Easy life. Right? Wrong. Like any good drama, the real story starts in the footnotes - or in this case, the attachments. Enter the schedules. Dozens of them. Each one a supporting character with its own quirks, secrets, and demand...

Episode 2: Deadlines, Dread, and the Dreadline Startup founders often think taxes are about numbers. In reality? They’re about calendars. In this episode, Alex - the neon-sneakered CEO of YOLO Inc. - discovers that IRS deadlines don’t care about his pitch deck, his cold brew habit, or the fact that he’s “too busy scaling.” Form 1120 isn’t just due “sometime in April.” The IRS sets the clock based...

Episode 1: The Curious Case of the Missing Return Every startup founder has that one pile of unopened mail labeled  “deal with later.”  For Alex, the 32 year-old hoodie wearing and neon-sneaker-wearing founder of YOLO Inc., that pile turned into a horror show when it produced an IRS letter titled:  Failure to File – Form 1120. If you’re wondering what Form 1120 is, think of it as the IRS’s annual...

Welcome to🎙"  Episode 0: Introduction" of Tax Bits: The Pink Shoes Investigations – Inside America’s Corporate Tax Secrets . The spark? On a recent vacation, I was flipping through the IRS Form 1120 instructions (yes, I know 🙈). It was painfully boring… until I started turning the rules into stories. Suddenly, I wasn’t yawning anymore - I was laughing, connecting dots, and imagining cha...