- We're back downstairs now. Grandpa is playing the harmonica, when the buzzer rings.
- Flurry! Excitement! Everyone figures it's Tony come to call for Alice.
- But it isn't. Instead it's a bespectacled cranky guy from the IRS, come to talk to Grandpa about his taxes.
- The tax dude tries to start a serious discussion about financial whatsis, but he's interrupted by the doorbell.
- It is Tony this time (looking mighty spiffy in his suit) and everybody flutters and fuses. The IRS guy looks like he's sucked a lemon up his nose.
- Finally Taxdude von Lemonsnout gets down to business.
- Grandpa has never paid taxes, as it turns out. He owes twenty-two years back income taxes.
- Owing twenty-two years of back taxes is a serious matter, Shmoopers. Grandpa just pooh-poohs it, but he can do that because he's in the movies. Don't try it at home.
- Grandpa says he "wouldn't mind paying for something sensible" but says that paying the government for battleships and Congress, and the President is such a waste of money.
- Alice comes downstairs to take Tony away, but Tony wants to stay and listen to Grandpa give the tax-dude what's for.
- The taxman yells at grandpa but is driven off by Ed's xylophone and the fireworks going off.
- Then there's a weird moment where Tony says the government might get him in trouble, and Vanderhof says he doesn't actually owe the government anything.
- In the play he really hadn't paid his taxes; but Hollywood may be uneasy about sneering at authority in quite that way.
- Anyway, Alice and Tony are about to go, but Essie's Russian dancing teacher Mr. Kolenkhov shows up for dinner.
- Everybody sits down and Grandpa says a cutesy folksy prayer asking God to keep them all safe and healthy, and then they all eat.