The dangerous pursuit of happiness

Bob once said this:

"Our country is dedicated to the 'Pursuit of Happiness.' The problem with that is that if we're constantly pursuing happiness... we're never actually happy. It's always in front of us. We should be dedicated instead to Happiness. Or just being happy."

Wise words, no? (I love that man) I believe that is a HUGE distinction. Pursuing happiness is plain dangerous to one's mental state. And perhaps the explanation to why life can feel like one big treadmill. The carrot in front of us is our happiness. Taunting us:

Ha ha. You'll never catch me! Feel free to pursue me until your legs fall off. But you'll never catch me!

 So what do we do about it?

Well, I have a lot of thoughts on the subject. Many of those I shared in a post titled "How to be happy. Now." I wrote that in the midst of fighting foreclosure. In the face of lots of stress I was committed to happiness. No matter what. In the moment. That's key. Not when we're out of this foreclosure mess, but now.

Get in action
I also believe that being in action helps. Ever notice how when you're super busy doing something that inspires you, you're not sitting around wondering whether or not you're happy? Yeah. I like how that works.

Bob turned me on to this reality show called Shark Tank. On the show, inventors and business people have the opportunity to pitch their ideas to a group of "Sharks" or investors who may or may not choose to become an angel investor. On the surface it doesn't sound very interesting.

It's the people and their stories that make it worth watching. One story in particular really inspired me.

The Mod Mom
Kiersten Hathcock of Mod Mom Furniture describes herself like this:

I'm an ex-marketing exec mom turned freelancer turned web designer turned nanny turned furniture designer and builder. I opted for the straight and narrow career path as you can see. :)

As she said on The Shark Tank, she left her job to stay at home with her kids and then her husband lost his job. So she taught herself carpentry and began a furniture company to support her family.

It all began with a toy box. Apparently they were looking to buy one but couldn't find any they liked, so she decided to learn how to make her own and the business grew from there. She now can't keep up with the demand as she can only physically make three toy boxes herself in one week.

The Noah Owl Box from Mod Mom Furniture

I love this story because it illustrates how resilient people can be. So often it's not until our backs are up against the wall that we really get creative. Opportunity exists even in the most dire times. But it's not going to just fall into your lap. You have to get in action.

Many times I've said to Bob, "I wish I could make furniture." Well, I'm not going to just wake up one morning suddenly able to wield a jigsaw with the grace of a seasoned carpenter. But there's no reason why I can't teach myself like Kiersten did. Sometimes I just really want that overnight thing to really happen. You know? But it won't. It never will.

By the way, I really love that toy box.

How to Steal like an Artist
Have you seen this? It's a blog post by an artist named Austin Kleon that's been making the rounds on Facebook. As Austin describes it, it's a simple list of ten things he wishes he'd heard when he was in college. And it's great. I wish I'd heard these things earlier as well.

But given the fact that I thought I had it all figured out back then I probably wouldn't have really listened anyway. Now that I know that I have no idea what I'm doing, I'm a much better student.

I found the list to be inspirational and a good reminder for the best route to happiness in life.

Here's an excerpt:

5. Side projects and hobbies are important.

Speaking of play — one thing I’ve learned in my brief tenure as an artist: it’s the side projects that blow up.
By side projects I mean the stuff that you thought was just messing around. Stuff that’s just play. That’s actually the good stuff. That’s when the magic happens.

Magic happens when you're not trying to force it to happen. When you're just playing. When you're being self-expressed, living in the moment and trying something with no particular agenda. Experimentation for the sake of experimentation. Losing yourself in the moment.  Not only is that where the magic happens. It's also where the happiness lives.

I highly recommend you read Austin's entire post.
Then come back here and tell me what you thought of it.

So, those are my thoughts on happiness for the day. My greatest reminder is Malcolm. He's happiness personified. Already a little more than 8 months old. Already crawling and pulling himself up to standing. That's all he wants to do all day long. Pull himself up to standing. That and put things in his mouth.

When I'm laughing with Malcolm for absolutely no reason, I am happy. I'm not pursuing happiness. I'm being happy. Automatically. And without thinking about it.


Worth noting: Malcolm has a huge smile on his face right now. Know why? He just pooped.

Foreclosure Fraud: Did the bank lose your paperwork?

This is not a feel good blog post.
This post is very likely to make your blood boil.
To twist your stomach into knots.
At the heart of this post is outrage and disgust.

Here we go...

On Sunday night, 60 Minutes featured an incredible story about the foreclosure crisis that brings this entire disaster to an all new low. 

And it's all about the paperwork.

Remember all that paperwork you signed when you bought your house? Oh, the paperwork. Pages and pages of paperwork. Of course you remember the paperwork!

Well, according to the 60 Minutes story, it's very possible that your bank doesn't remember it. That they might have "lost" it. But not really. They say "lost" but what they mean is that they never actually bothered with it when your loan was bundled and sold. Why? Because all of that paperwork would just slow down profits.

This might seem like a small point. But it's not. Without that paperwork, the bank cannot prove ownership of your mortgage. And if the bank can't prove who owns your mortgage, then they have no legal right to foreclosure.


Here's an excerpt from the 60 Minutes story reported by Scott Pelley that explains:

Scott Pelley explains a bizarre aftershock of the U.S. financial collapse: An epidemic of forged and missing mortgage documents.


It's bizarre but, it turns out, Wall Street cut corners when it created those mortgage-backed investments that triggered the financial collapse. Now that banks want to evict people, they're unwinding these exotic investments to find, that often, the legal documents behind the mortgages aren't there.

Caught in a jam of their own making, some companies appear to be resorting to forgery and phony paperwork to throw people - down on their luck - out of their homes.

So, the banks can't find the mortgage paperwork so they create phony paperwork. Forgeries. Can you imagine? This is real. This actually happened.

You've got to watch the entire segment. It's truly unbelievable.

Bravo to Scott Pelley and 60 Minutes for breaking this story wide open.

But the real props go to Lynn Szymoniak. She is the source for this story and the woman who discovered the forged documents while fighting to save her own home from foreclosure. When Szymoniak was told that the bank had lost her documents only to miraculously find them a year later, she got suspicious. And as a lawyer and fraud specialist focusing on forgeries, she uncovered this conspiracy.

This is truly a mess. No. A disgrace. I think back to when Bob and I were trying to modify our loan and were required to provide the bank with endless streams of paperwork. Over and over again. The banks required that the paperwork be perfect. They would lose it. We'd send it again. They were allowed to make mistakes, we were not.

This brings it all to a whole new level. It's unacceptable. Period.

And the banks shouldn't be allowed to get away with forgery, simply by claiming ignorance.

By the way, banks that participated in creating false documents to replace "lost" paperwork include:

Wells Fargo
Bank of America
HSBC
Deutsche Bank
Citibank
US Bank

They all outsourced their forgery to a company called Docx. Well, not directly. They claim that their mortgage servicing firms are the ones that are responsible for hiring Docx to create the phony documents and that they had no knowledge of any forgeries taking place.

Do you buy that?
That the banks had no idea this was happening? I don't. Not for a second.
And I'm tired of this argument. Of course they knew. And they should take full responsibility.
How many down-on-their-luck homeowners have to pay for this nightmare?

People in foreclosure are already living their nightmares and now this?

How do you know if your mortgage paperwork was "lost"? 
Well, if your mortgage was bundled and sold at the height of the real estate peak, then it's very possible that your paperwork was forged along the way. So, you'll want to request your paperwork from the bank. And then look it over closely. Look at the date of assignment of mortgage. Look at the signature. If it's signed by "Linda Green" then it's been forged.

Who is Linda Green?
I'll let 60 Minutes explain:

One of the strangest signatures belonged to the bank vice president who had signed Szymoniak's newly discovered mortgage documents. The name is Linda Green. But, on thousands of other mortgages, the style of Green's signature changed a lot.


And, even more remarkable, Szymoniak found Green was vice president of 20 banks - all at the same time.


Where did all those documents come from? We went searching for "the" Linda Green and found her in rural Georgia. She told us she has never been a bank vice president.


In 2003, she was a shipping clerk for auto parts when her grandson told her about a job at a company called Docx. The company, that was once housed in Alpharetta, Ga., was a sweatshop for forged mortgage documents.


"They were sitting in a room signing their name as fast as they possibly could to any kind of nonsense document that was put in front of them," Szymoniak said.

I urge any homeowner (whether in foreclosure or not) to request your documents to see if your mortgage might have been a part of this mess. It's best to know now in case, God forbid, you might end up in foreclosure down the road.

And everyone should watch the 60 Minutes segment. Today.



Or you can read the text: Mortgage Paperwork Mess: Next Housing Shock?

What do you think of all of this? Have you been told by your bank that your paperwork has been lost? Any lawyers out there reading this? What say you?

The new logo: red and turquoise love

Why, yes. I did get a makeover. Thank you for noticing. I just felt it was time. My old look began to feel, well, old. And kind of drab. Unpolished. In need of professional assistance. 

how it went down...

I'm reading a new post on Baby By the Sea and am blown away by the blog's new look. I'm immediately struck by blog envy. Check out that logo. I love it. It's fab. Fabuloso. I want a new logo. I want my blog to look that amazing.

So I ask Baby By the Sea’s Jennifer Furber who created her inspiring new logo. The response comes of no surprise. Sara Jensen. Sara Jensen of Friday Harbor. Sara Jensen of Lost Bird Found.  Of course Sara is behind Baby By the Sea’s fabuloso new look. 

the back story

Sara and I met last year via Twitter. Out of the blue I received a tweet that went something like this: 

"I think we live on the same island."

And she was right. We did. We began a Twitter friendship. I followed her. She followed me. You know how it goes. But it took us forever to meet for real... which you wouldn't think would be so hard living on a small island with not even one stop light. 

We were both surprised we hadn't crossed paths in real life. Only on Twitter. Until the day I walked into her office and introduced myself. I was 35 weeks pregnant at the time.

We didn't really hang until after Malcolm was born and we went to her husband Thor's birthday party on South Beach. We ate delicious Korean BBQ short ribs (one of my favorite dishes) and hung out on the wind-whipped, beautiful stretch of driftwood blanketed beach that is South Beach on San Juan Island. 

Malcolm happened to be only 13 days old. He spent the entire party sleeping in the Moby wrapped tightly to my body while we whale watched and hung out with other Islander parents of young children. The kids were climbing all over the driftwood like little monkeys and building driftwood forts. I honestly don’t remember much of what was said at that party. I was a little sleep deprived at the time. But… I remember thinking: Sara Jensen is way cool. I’m glad we met.

 

We had only just begun to know each other when Bob and I broke the news that we were leaving the island. Returning to Chicago. The island is small, but it’s full of amazing people. Sara is one of them. So hiring her to create a new look for LITTOF was really a no-brainer.

And I LOVE what she did. The blog looks much happier to me now. 

It was Sara’s idea to use the logo to tell a story. And I think it's brilliant. It actually tells our story. 

Here it is in a grey and red version:

We’ll be making a few more tweaks to the blog to make it look even better. Spiffy-ing things up.

Well? What do you think of LITOF's new look?

Do you have home seller's fatigue syndrome?

Chicago Tribune reporter Nancy Watkins has coined my new favorite phrase:

Home Seller's Fatigue Syndrome

Her house sat on the market for one year and one week before selling for 33 percent less than she paid for it in 2005. Not in a short sale or foreclosure, but still. Those of us who have had homes sit and sit and sit on this godforsaken market can relate to Nancy and the phenomenon of HFS as she calls it.

Seriously, reading this took me right back to my mad cleaning frenzies having to get the house ready for prospective buyers and the moment when an agent barged into our house with her clients in tow without an appointment... and I had JUST gotten dressed after a shower. Oh, the stress. The prolonged stress. The constant cleaning and de-cluttering. The strangers in our house. The agents who don't call first... No, I don't really miss it.

So.

How do you know if you're suffering from HFS? Well, Nancy cleverly and refreshingly details the symptoms. Here are a just a couple:

-You have a constant unsettled feeling reinforced daily by the sight of the sign in your front yard, swinging in the wind and, you would swear some days, laughing.

-You have developed paranoia because during various open houses people swiped your prescription drugs and went through your drawers. Not only do you no longer have open houses, but you jump whenever your husband touches you.

For the rest of the symptoms as well as the cure, you'll have to read the entire Tribune article.

You'll be glad you did.

Here it is:

Stressing the Positive in Selling a Home, or Just Plain Stressing - Chicago Tribune

By the way, I came across this article thanks to Dennis Rodkin of Chicago Magazine's Deal Estate blog. Check it out. And follow Dennis on Twitter: @DealEstate.

And lastly... just wondering. Ever have prospective buyers barge in on you unexpectedly? And what is the thing you'll miss the LEAST about having your house on the market? 
Share in the comments below...

Back on the yoga mat again

Yesterday I woke up to a body that ached all over.
But not because of some killer yoga workout.
No.
I ached because my body was missing yoga.
How can that be? I promised to do yoga once a day every day for the month of March.
Well...
Time to fess up.
I pushed that promise to the far recesses of my brain throughout last week. I've skipped approximately 8 days this month.
Bailing on my commitment.
Does not feel good.
 
Has this ever happened to you?
You promised yourself you'd eat healthier. No more chocolate. No more potato chips. But then someone leaves a bag of chips behind at your house after a dinner party. And you eat one. Then you eat a handful. Then you think, "Well, I just blew it. There goes my promise. I may as well finish the bag."

I may as well finish the bag?! Crazy, right?

Well, that is exactly what I almost did with my yoga commitment.

"Well, I missed a day. There goes my perfect month of yoga. Won't matter if I miss another day. Or another...I'll just pretend I never made the promise in the first place. I may as well just burn my yoga mat. Get rid of the evidence."

But no matter how hard I tried, I couldn't pretend that I had made that promise. That's always there.

The logic gets so crazy in those moments. I mean, who am I hiding from? Myself. The side of myself that wants to be better. And when I break my word to myself I'm only indulging the side of myself that's okay with being complacent. But that is not the game I'm up to. I'm not okay with complacency.

That doesn't mean that I expect to be perfect. That just means that no matter how many times I break my word, I'll keep going back to the mat, so to speak.

Yesterday I could feel my body calling out for Downward Facing Dog. It wanted to be stretched. Lengthened. So I re-committed. I realize there remains only a few more days in the month. But no matter. It's not over. Every day counts.

So last night at 10:52 PM, I got back on the yoga mat again. It felt great. The yoga felt physically energizing (my body was literally buzzing all over after) but also emotionally invigorating. Because I did what I said I was going to do.

On a somewhat related note in the world of March Madness, who isn't inspired by VCU's road to the Final Four?! As Coach Shaka Smart said after their win last night, "Anything is possible."

VCU Reaches 2011 Final Four Thanks to Dominance, Not Luck - SB Nation

How to avoid wanting

The other day I came across this Groupon:

$10 for a one-year subscription to "dwell" magazine!

I am a big fan of Dwell. And $10 for a year is a steal, right? Totally. A no-brainer. This is why I love Groupon. It helps me save money on things I love and would already buy even without the discount.

So I was all set to partake in this particular Groupon when I remembered...

Reading magazines makes me want to buy things. 

And reading Dwell really makes me want to buy things.
Things like... a house.

Back in May of 2009 I wrote a blog post about this very subject. It was time to shed our possessions and I began with the stack of magazines. Getting rid of those magazines had me realize so much about the source of wanting.

Especially fitting today is what I wrote about my relationship to Dwell:

Take Dwell, for example. I love Dwell magazine. The images, the homes, the stories, the ideas it would inspire... but I could never shake the fantasy it sparked. The fantasy and dream for a better life.

What I didn't realize until I stopped reading Dwell is that looking at the perfect images of other people's homes and furniture made me feel lacking. Our home wouldn't be complete until I replaced the living room furniture with that (incredibly expensive) Ligne Roset sofa I saw or until we installed solar panels on the roof. Until we renovated our 2nd bathroom and installed a rain shower head in the first. I compared my life to the lives I saw in those pages and always felt inferior. The luster of our home would lesson each time.

After closing an issue I would look around our house and just feel, ugh. That rug needs to go. Look at our dining room table... it's so boring compared to that oblong white marble table I saw in Dwell.

It's been a few years now since I let my Dwell subscription lapse. Our life looks so different. Yes, we have a baby. We live in a new city. Those are the big and obvious changes. Not so obvious but big in a different way is the fact that I don't feel lacking. We have far less today than we did back when I was a regular Dwell reader, but it doesn't feel that way. Our life feels full. Complete. We have everything we need. And the last thing I want to do is go back to feeling lacking.

Needless to say, I will not be purchasing the discounted year subscription to Dwell offered by Groupon.

Turns out I can't afford it.


P.S. I don't mean to bad mouth Dwell. I seriously adore the magazine. I just know my own weaknesses and refuse to indulge them. That doesn't mean I won't occasionally pick up an issue and be inspired. I know what you're thinking... if I pick up one issue for $5, why wouldn't I just pay another $5 for an entire year?! Well... see above.

If you'd like to read my post from May 2009 about magazines, here it is: "You Really Should Have Read This By Now"

Imagine this foreclosure story

Imagine you’re 75-years-old.

You live in New York State with your spouse and together you have a daughter in Chicago and a son in Connecticut.

Imagine you and your spouse are tucked into bed, sleeping peacefully at 9:45 PM when you’re startled awake by banging at your door.

What goes through your mind? Someone’s been hurt. Right?

Imagine that the person banging on the door is the Sheriff. But he’s not there to deliver news of any accident. He’s there to serve you foreclosure papers.

Not your foreclosure papers. Your daughter in Chicago. The Sheriff is there to serve you with her foreclosure papers.

At 9:45 PM.

Now imagine you’re the brother in Connecticut. Same story. Sheriff serves you with your sister’s foreclosure papers.

And now imagine you’re the sister.

You’re in Chicago and you're in foreclosure. Fighting to save your home. You've been served with the papers... and have just found out that your parents in New York and your brother in Connecticut were also served with your papers.

You’re in HUD-Approved Mortgage Counseling. You’re researching your options. Navigating the labyrinth of foreclosure.

You’ve already been through hell. With a brain tumor. You lost your job when you used up all of your medical leave only to have your property taxes double in the last two years.

Your $1260 mortgage ballooned to $2300. None of this was expected. But it happened. And now not only are you having to deal with the fear and intimidation that accompanies the possibility of losing your home, but your parents and brother are too.

You try to talk to Wells Fargo but they tell you to communicate with their foreclosure attorney who never picks up the phone.

You try to keep it together.

Your husband grew up in communist Czechoslovakia. He escaped his country -- he left there to come here for a better life. He came here with nothing, got his green card, did everything exactly as he was supposed to -- worked hard, paid taxes, pursued the "American Dream" -- and now is back at square one. He wonders if he made the right decision. But he knows he did. Because he met you.


Now imagine that this story is true.

Because it is. This is a true story from a Love in the Time of Foreclosure reader.

Her name is Trish and she gave me permission to share her story with all of you.

What really touched me is how much she and her husband have been through and how they are still trying to create a positive outcome. They don't know what that will be at this point. Their story doesn't have an ending yet.

I was also completely surprised by the fact that her brother and parents were served with her foreclosure papers. I've never heard of that. As Trish wrote to me, she's never experienced such intimidation tactics before. No. I wouldn't think so. It makes me wonder... how much of this is going on that we don't know about.

Has anyone else out there fighting foreclosure been the victim of the bank's intimidation tactics?

The other mystery is that because she is in HUD-Approved Mortgage counseling, Wells Fargo is not allowed to pursue legal action against her for 90 days. Yet they served her entire family with foreclosure papers. This seems to be a case of the right hand not knowing what the left hand is doing.

And it makes me angry.

This is what I want to say...

Trish,

As I wrote to you before, you're not alone. Keep focusing on the positives in your life. I'm glad you have each other. Because that's how you'll get through this... together.  Good luck. And please keep us posted. As our story has made a difference for you, now yours will make a difference for someone else. Thank you for having the courage to share.


Best,


Steph

I love...

I shot this video last night on my iPhone. Pablo was begging for scraps at the dinner table and Malcolm was just going gaga over his Pug noises. The sound of Malcolm laughing is my favorite sound in the universe.

Malcolm is 7 1/2 months already, learning to crawl (he's very good at scooting backwards) and teething (he's got two sharp little baby teeth already.)

I hope you enjoy our little man's laughter!

Yogi by night

This is my yoga space.

It becomes my yoga space when I roll out my mat. Before that it's our family room. Throw a blanket down and it becomes Malcolm's play area.

But that mat transforms it into my yoga time.

And so far, that has happened exclusively at night. Not until at least 9PM. There have been a few nights where I don't begin until 11:50 PM.

I'm checking in on my promise to do yoga once a day for at least ten minutes every single day in March.

So here's the update. My daily practice has ranged from fifteen minutes on the low end to sixty minutes on the high end. Well... the low end was actually March 4th when I attempted to do my practice with Malcolm. I don't really count that, though.

Things I've learned in 7 days of my yoga journey:

1. Yogis Anonymous is a God send! Two of my friends recommended it to me because they have FREE online classes. And one of my friend's wife is a teacher there. Her name is Aria Mayland and I highly recommend her classes! Check out Yogis Anonymous!

2. A little yoga goes a long way. The days that I only get fifteen minutes in, I still feel the difference. I always begin with breathing to center myself. That alone is worth the trouble.

3. I can feel years of neglect in my muscles. The other night I was doing a cross-legged forward bend and was overwhelmed by how tight my hips are. I used to be so flexible. Especially when I was a dancer. Here's what I realized. The reason I never commit and stick to a daily routine is because I've been unwilling to confront all the years of not being on a daily routine and what that neglect has done to my body. Does this make sense? It's like allowing the laundry to pile up. The more laundry that piles up, the harder it is to confront it.

So that's where I am right now. I'm still hoping to get in a full ninety minute Yogis Anonymous class. Perhaps on the weekend. I'm looking forward to that.

How's this yoga-once-a-day challenge going for you? Anyone out there following along at home?

Oh- one more thing... I've been doing Itsy Bitsy Yoga with Malcolm... hoping to give him the gift of yoga. He seems to like it.

What to do if you owe more to the IRS than you can pay...

Image via WikipediaCrying helps. Well, a little. Well, okay. Maybe not. But it just seems to go with the territory.

Let's just say that I've shed a few tears over our IRS debt. Sometimes the frustration from the endless phone calls is enough to bring it on. But crying doesn't really help. What does? Determination and patience.

It's tax season. April 15th is right around the corner and I figured this topic would be helpful to some people out there. Perhaps a couple. Maybe even a few. We'll see.

So what do you do if you owe more to the IRS than you can pay?

Well, I'll tell you what we did. What we're doing.

I'm going to structure this as a question/answer post. We'll start that way at least. See how it works. But first I need to say that I am not a tax attorney. I'm not an attorney of any kind. Not an expert. Just someone who's been there.

Okay... here we go....


Why do you guys owe so much to the IRS?
I'll start by reminding people that we were putting all of our money into the renovation of our house. We got behind on our income taxes and were planning on making that up in 2008.

But then Bob lost his job and all of our money then went towards paying our mortgage so that we wouldn't lose the house. But then we ended up in foreclosure anyway. And lost the house... but not in foreclosure. In a short sale.

Every time I talk to an IRS agent (almost every time) they ask, "Why do you owe so much?" This always puts me on the defense. I always hear that question as, "Why are you such a screw up?" And instead of responding, "Why are YOU such a screw up?!" which is what the child in me wants to say, I take a breath.

Why do we owe so much? Because my husband used to make good money as an independent contractor. But then he lost his job and because we had our savings tied up in the house (another way of saying we had no savings) our money went towards saving our house.

Simple answer: We got behind. But now we're trying to catch up as best we can and be responsible for our debt.


Wait, didn't you guys declare bankruptcy?
Why do you still owe the IRS?
Yes. We declared bankruptcy. The reason we still owe the IRS is because declaring Chapter 7 does not wipe out IRS debts. Or student loans, by the way.

While we were "in bankruptcy" we weren't required to pay our IRS debt, but we were allowed to make voluntary payments. We did not do this. Only because we couldn't afford to. The benefit in making voluntary payments is that you're chipping away at your debt and the interest.

Once we were "out of bankruptcy" we started receiving those certified letters from the IRS.


What are the options for someone who owes more to the IRS than they can afford to pay?
Well, there might be more options than we considered. One option is to hire a tax attorney and work with them. We wanted to handle it ourselves so we didn't go that route. Instead, I spent a lot of time on the phone with the IRS (did you know that their hold music NEVER changes? Never) to find out what our options were.

We were told we had two options and they were:

1. Offer In Compromise
Essentially an Offer In Compromise is the way to settle your debt with the IRS. If you want to settle for less than you owe. There's this big long form you have to fill out that's pretty confusing and you have to pay something like $100 for the process of consideration. You submit all of this material and the IRS then considers your situation. During this process of consideration, they stop sending you scary certified letters and they stop penalizing. So you have a breather until they let you know whether or not your offer is approved.

That's my paraphrasing. But you should really visit the actual IRS website that explains the Offer In Compromise.

2. Installment Agreement
This is where you agree to pay the entire amount that you owe, but you pay it in a manageable monthly installment.


Which option did you choose?
We chose the installment agreement. Here's why.

On one of my many long phone calls with the IRS, someone told me that it would be a waste of our time to submit the Offer In Compromise. This person said that because we were young and had at one point made a good amount of money, they wouldn't approve our offer.

Why? I asked. Why? Well, because we have the rest of our lives to work. We're not incapacitated. We statistically have many years left. Enough left to work and make up the money that we owe. So there would be no reason for the IRS to settle for a lessor amount.

This IRS agent told me that the Offer In Compromise is usually for the elderly or people who can no longer work or make money.

So we decided not to bother with that long and confusing form and instead pursued an Installment Agreement.

BUT. Yes, there's a but. Don't believe that agent like I did. I have a friend who used to work for a company that helped people settle their debts to the IRS. He told me that agent was wrong. The Offer In Compromise is not only for the elderly or people who can no longer work. He said that we should have at least tried it first. Well... too late for us.

This leads me to an important tangent:

When you talk to the IRS, always get the agent's ID#. Always. Always. Always. Why? Because in my experience, they give contradictory and often wildly inaccurate information.

Example, please?
Why yes, of course.

This example is from when I was in the middle of setting up our Installment Agreement.

-CUE FLASHBACK-

We're in a 1910 farmhouse on a rural island in the Pacific Northwest. It's raining. I'm very pregnant. Only one month away from my due date and I just got off the phone with an IRS agent who told me to fax in all of our financials in order to be considered for an Installment Agreement.

We had to gather bank statements from every bank account (at the time we had 3) for the previous three months and pay stubs from the previous three months.

When I suggested that it would be a lot of pages, the agent promised me that didn't matter. She assured me that they would accept a fax of any length. She told me to call back when I had it ready and an agent would sit with me on the phone while I faxed it in so I could be sure it arrived. This agent, I might add, was very kind on the phone. So friendly.

Well.

I gathered all of our financials which totaled 45 pages (!) and made that call.

So there I am really pregnant at EarthBox (my place of employment) on my day off because I don't have a fax machine at home and my wonderful boss said I could use the one at work. I have all 45 pages of our financials ready to get this darn thing set up once and for all.

The phone rings. I follow the prompts as usual. The familiar hold music clicks on. Hold music I'm sure is the same in the elevator to Hell. Anyway, there it is. And here I am.

Agent #0247233 answers.

Her voice doesn't sound too friendly. But I don't let it affect my tone. I explain why I'm calling. In a very kind. Very friendly tone. My tone does not work on this agent.

And this is where I go to my notes (always take notes):

my notes from my call with the IRS on June 4, 2010:

-Spoke with #0247233. She was incredibly rude to me. When I asked to speak to a manager, she put me on hold for a long time. Then came back and said that all of the managers were in a meeting.

-She told me they would NOT accept a 45-page fax (which conflicts with the info I was given on June 2 when I spoke to #0090582). I told her that I was told it would be okay to fax it in.

-Said they wouldn't accept a fax greater than 10 pages. I had to mail it in.

-She refused to answer my question about how to mail it in. I wanted to know if it would be better to send it Priority Mail or Certified. She wouldn't answer. She said, "I'm not going to answer your question because you'll just say I gave you the wrong information."

-When I asked what I needed to include with my pay stubs, she got very argumentative. Again saying she wasn't going to answer my question because she didn't want to give me a reason to say she gave me "wrong information."

-I said, "I'm being really nice to you and you are being hostile towards me." And she hung up. She actually hung up.

At that point, this very pregnant woman got in her car and sobbed. Just sobbed.

-END FLASHBACK-

So, yes. It can be extremely stressful trying to set something up with the IRS. So many hoops to jump through and just wanting to be free of the debt.

It makes it even harder when the person on the other end of the line is hostile for no apparent reason and when you're given blatantly inaccurate information. It's beyond frustrating.

But it happens. So what do you do? Well, if you need to take a minute or two to sob it out. Do that. Then just get back on that horse. You have no choice. The IRS will not forget about your debt. You have to find a way to be responsible for that.

Therefore, you just have to stay on top of things. If you're given a call back date, make sure you call back ON THAT DATE. Don't miss anything. And when in doubt, call and ask. Double, triple check everything.


How do you set up an installment agreement?
You call the IRS and tell them that you'd like to set up an installment agreement. You will then have to fill out form 433-F. You can fill it out and then call to give the information over the phone. Or you can fill it out and mail it in with the back-up documentation.

The required documentation includes (but is not limited to):

3 months bank statements (all accounts)
3 months pay stubs

Basically you're sending in proof of your monthly expenses. The IRS uses this information to determine how much you're ABLE to pay on a monthly basis. They will always take the HIGHEST possible amount based on your income vs. expenses.

IMPORTANT NOTE ABOUT INSTALLMENT AGREEMENTS:
I'm not sure if this applies to ALL Installment Agreements... but it did apply with us. Once you enter into an Installment Agreement with the IRS, a tax lien will be placed on you and show on your credit score.


Are you now in an Installment Agreement?
Yes. We pay $200 per month. We were originally paying $750 per month but that was when we weren't paying rent. Since we now pay rent and have more expenses living in Chicago (including baby expenses) the IRS agreed to lower our monthly amount.


Do you owe more to the IRS than you can pay? If so, how are you going about paying your debt? What questions do you have? Other suggestions? Please share in the comments section.

Thanks! I hope this helps.