Today, a young man posted the following in a popular personal finance group on Facebook:
“Does anyone have any real experiences with audits on HSA accounts? Does it happen? I’m realizing now that I may have made some deductions on some ‘unqualified expenses’.”
This fellow just announced to the world that he may owe the IRS back taxes and a hefty 20% penalty because he used his Health Savings Account to pay for something he shouldn’t have.
While it’s laudable if he wants to correct his potential mistake, a public electronic forum isn’t a smart place to be making financial confessions attached to your real name.
- It’s a public invitation for an audit. He may as well have posted: “IRS: please audit me.’ Someday, I wouldn’t be surprised to learn that IRS computers are mining public social media data to automatically identify audit candidates. Maybe they already are — like bill collectors. An audit is never a pleasant process, whether innocent or not. Better to determine how to correct your tax mistakes in private than publicly invite an audit.
- It’s a public invitation for scammers. This fellow may now receive Facebook messages from people trying to take advantage of his ignorance: “Pay me $X, and I’ll fix the problem for you.” Or, worse, extortionists: “Pay me $X, or I’ll turn you into the IRS.”
A better approach?
- Do some basic research. A simple web search turned up some quick answers to his underlying question — like this article: What If You Use Your Health Savings Debit Card For Take-Out?
- Consult a trusted advisor. Once armed with some preliminary findings, follow up with a certified tax professional for some expert advice. In private.
The message for your kids: just because it’s easy to ask a personal financial question on social media doesn’t mean you should. Financial confessions belong in private, not on Facebook.
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