HOW MY COUSIN’S SIDE HUSTLE TURNED INTO A FULL-TIME IRS PROBLEM
HOW MY COUSIN’S SIDE HUSTLE TURNED INTO A FULL-TIME IRS PROBLEM
It all started innocently. My cousin, let’s call him Tony, had a side hustle. Nothing too crazy, just flipping used electronics online. A little profit here, a little profit there. Nothing that would make him the next Warren Buffett. Or so we thought.
Tony was ambitious, but also hilariously naïve. He thought keeping all his earnings under his mattress was smart. Not for security purposes, mind you, but so he could “watch the money grow.” He didn’t realize mattresses don’t compound interest.
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. The first mistake came when Tony decided to expand. He started buying bulk electronics, hoping to resell them for double the price. This is where financial literacy comes in handy. Tony, however, skipped the “literacy” part.
His first purchase was 50 brand-new smartphones. He was ecstatic. He posted them online and bragged about his “investment portfolio.” He used the term portfolio with such confidence that even Wall Street brokers would have paused.
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Soon, Tony’s little side hustle attracted attention. Not customers, mind you, but a curious government agency called the IRS. Apparently, selling electronics for profit requires paperwork. Who knew? Tony’s reaction was pure comedy:
“Paperwork? I thought that was for taxes or something. I’m just selling phones!”
Yes, Tony, selling phones is legal. Paying taxes on profit? That’s the tricky part.
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Tony tried to get smart. He Googled: “How to avoid paying taxes on side hustle income.” Big mistake. He ended up in a financial rabbit hole that included CPA blogs, Reddit threads, and forum posts written by people with only slightly more common sense than him.
He learned words like: liability, deduction, 1099, and audit. To Tony, these were all villain names from a Marvel movie.
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Next, Tony tried “creative bookkeeping.” He started writing down all his expenses, including his Netflix subscription and his daily Starbucks latte. He reasoned: “I work better with caffeine. Therefore, latte = business expense.”
I watched him with a mix of admiration and terror. He even tried claiming his dog as a “security expense” because the dog barks at intruders.
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Things escalated when Tony started using cryptocurrency for transactions. He reasoned that Bitcoin was “digital cash” and therefore invisible to the IRS. Hilarious, right?
Except, Tony forgot one tiny detail: blockchain is public. Every crypto transaction is recorded forever. Somewhere, a government auditor laughed silently while sipping tea.
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Then came the marketing phase. Tony wanted more clients, more profit, more “financial freedom.” He created an Instagram page. The first post was a picture of his growing stack of smartphones with the caption: “Entrepreneurial Empire Loading…”
Within hours, a random accountant commented: “Empire? You mean audit incoming.”
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Tony ignored the warning signs. He started advertising on Facebook, promising fast delivery and unbeatable prices. Orders flooded in. Sales were booming. Profits were increasing. Tony was ecstatic.
Until the IRS literally called.
Yes, a real phone call. Tony answered like he was chatting with a telemarketer.
“Hello, this is Tony,” he said.
“Mr. Tony, we need to discuss your recent income,” said a serious voice.
Tony’s face went pale. He tried to act casual: “Income? Oh, you mean like, money I use for living expenses?”
The agent didn’t laugh.
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At this point, Tony realized his side hustle had officially become a full-time problem. Every day, he was calculating profits, checking his bank account, and practicing what he would say to the IRS agent.
He tried motivational mantras: “I am rich, I am financially independent, the IRS loves me.” The IRS did not love him.
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Tony decided he needed professional help. He hired a CPA, which cost him more than he had earned in profit. He justified it by saying: “It’s an investment in my financial freedom.”
The CPA looked at Tony’s books and laughed… quietly at first, then uncontrollably. Tony’s “deductions” included a $5 scratch-off lottery ticket, his gym membership, and a “business lunch” with his neighbor’s cat.
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Meanwhile, Tony tried explaining his situation to family.
“It’s just a side hustle, Mom!” he said.
“Tony, the IRS isn’t a side hustle,” she replied.
The family started betting on how many days before Tony had to liquidate his mattress of cash and beg for mercy. Odds were 3 to 1 that Tony would need to sell his gaming console to pay fines.
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Tony also discovered the dark side of online financial advice. Every TikTok “financial guru” claimed they could show him how to turn $100 into $1,000. Tony believed them. Naturally, he invested the last of his cash in a crypto token called “MoonPuppy.”
Within 48 hours, the value of MoonPuppy plummeted. Tony called me crying:
“I’m bankrupt!”
I said: “You still have $3.50 in the bank, Tony.”
He replied: “Emotionally, I’m bankrupt!”
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Tony’s IRS problem continued to escalate. They requested documentation for every sale. Tony tried to provide screenshots of PayPal transactions, which included personal memes, cats in sunglasses, and one particularly awkward selfie.
The agent was confused but intrigued. Tony’s audit became a mix of financial investigation and a comedy roast.
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At one point, Tony attempted to “negotiate” with the IRS. He sent them an email offering a lifetime supply of free electronics in exchange for forgiveness. The IRS politely declined.
Tony then tried a second approach: bribery with handmade cookies. The IRS politely declined again. Tony started considering moving to a remote island, but he didn’t know how to get there without triggering financial regulations.
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Finally, Tony realized the moral: side hustles can escalate quickly. $50 in profit can become a $500 headache. A $10 “investment” can become a $1,000 audit. His financial literacy grew exponentially, mainly in fear and sarcasm.
He learned terms like: taxable income, filing status, estimated payments, penalties, interest, and gross negligence. He also learned that sarcasm is not a valid financial strategy.
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In the end, Tony survived the IRS ordeal. He learned important lessons:
1. Side hustles require paperwork.
2. Cryptocurrency is not magic.
3. Banks, tax agencies, and accountants are not fictional villains—they’re real.
4. Humor can save your sanity.
He still sells electronics, but now he keeps detailed records, uses legitimate tax strategies, and doesn’t brag about his “portfolio” online. Emotional ROI: priceless.
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Tony’s story is a hilarious cautionary tale. It proves that ambition without financial literacy is like skydiving without a parachute: thrilling, terrifying, and extremely memorable.
Readers, learn from Tony. Laugh at him. Then double-check your side hustle income. Because the IRS is real, but so is comedy.
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