I just mailed off my 2009 tax returns, in which I reported all of my unreported earnings. I know my usage doesn’t meet the typical definition of unreported earnings, which is money a person or business earns and doesn’t report for tax purposes. In my case, I think of unreported earnings as income that doesn’t generate a 1099, such as my book sales through a UK printer and my eBook sales, which are handled by PayPal. These sales amounted to around 20% of my earnings in 2009, could go as high as 25% next year, and obviously, I report those earnings and pay the taxes or I don’t suppose I’d be writing about it.
Many small businesses treat any income that doesn’t draw a 1099 as free money, and don’t report it on their taxes. Since I have income in the 28% Federal tax bracket, the 6.5% Massachusetts tax bracket (think medical insurance penalty) and pay 15.3% self employment tax on the whole, that income is taxed at roughly 49%. But I pay my taxes religiously, most Americans do when it comes down to it, and that included my spending time to correctGoogle this year who under-reported my income by around $2400 on the 1099 they did send. I noticed because I figure my taxes based on my actual income, all of which is channeled through my business bank account, whatever the source.
On my way back from the Post Office, I stopped into the local Liberty Mutual Insurance office to complain, or point out, that they were applying a 25% discount for Air Bag / Automatic Seat Belts to my 1986 Dodge Omni. That’s a mistake, the Omni has neither, I don’t believe they were even available as options. But the woman who wrote the policy in the first place assured me that Liberty Mutual automatically applies these discounts based on the VIN (Vehichle Identification Number), by which she was implying that I was somehow wrong. Trust me on this one – I’ve had the steering wheel off, no air bag, and I wouldn’t have noticed automatic seatbelts at some point in the last 24 years.
Which poses an ethical question. How much trouble am I obliged to go to to correct an error that is not of my making and that I’ve already showed up in person to address? I did check the VIN number against the actual tag in the car when I got home, they match, and I’ve had the car on the road for years without the discount being applied, so either they’ve changed their underwriting guidelines, or my representative simply doesn’t understand how their system works.
From the “fairness” standpoint, it doesn’t really matter. I don’t ever take passengers in the Omni, and I always wear the seat belt so it may as well be equipped with automatic seat belts. But I suspect I’ll find time in the next couple days to call their main office and see what the deal is, without mentioning the fact I’ve already been into the branch office since there’s no point getting my rep in trouble. As a prize for honesty, my insurance bill for the next eight months will go up around $80.
Only in America.
When you have been sold insurance which you know doesn’t accurately reflect the reality it often means you are effectively driving without insurance. I was once sold insurance that I had to claim on …turned out the broker was taking money and not passing it on to the insurer. The policy document I had was invalid. Fortunately, the real insurer stepped in to mediate. It was hell though!
Bina,
Interesting point. In this case, it’s not an independent agent, it’s the local office of a large regional insurer. I’m trying to figure out the best time to call so I don’t get routed to the local office where I could end up getting the same story, which I’m sure is incorrect. I’ll probably just try after hours tonight.
Morris