Yes, it's OBVIOUSLY a non-fiction story, meant to be funny.
But I disagree that most things that are funny are fiction. Fiction can certainly be funny, but it's not exclusive. The truely funniest things in life, is the real stuff. The gaffe, the errors, the misteps, the ironic, the odd, the spectacular, etc, etc.
I have an idea, tell some friends that joke, aloud. And see if it really keeps their interest. Be sure to prep it with "If you can [listen to] this whole story without tears of laughter running down your cheeks, then there's no hope for you!" Also, be sure to add this: "For those of you who have lived in Texas, you know how true this is." Even though the story, as pointed out, isn't true at all.
In my experience, one would likely find the audience to not be very receptive.
I'd like to be clear about one thing too, I have never said that the poster (Roossy90) was not funny. I said the story on the link was not funny. I still think the story on the link is not funny. Even after re-reading it "trying to put myself in that position," I did not find it funny. It's not a lack of sense of humor, the writing was bad. The joke went on too long. The east coaster's first reactions were so large to the heat that it had no where to crescendo to. He was already in a world of hurt from the get go. Why would someone continue if they practically needed the heimlick manuevre after only the second tasting. Perhaps a less explosive response to chili #1 and a better, more worrisome build would've made it funnier.
I didn't like the fact that the East coaster's first written words were "Holy $h17." To make an unbelievable story believable, the actions of the characters needs to be credible thus keeping the fiction story rooted in non-fiction. A more subtle reaction to chili #1 would've been better like "Wow, you Texans sure like your pepper. A nice hot chili to start off the day. I'm sure glad my beer was close by."
This way, he's saying it's hot, when the Texas judges are calling it mild. Then he can move more slowly to passing out/keeling over, or what ever.
It's not very clever writing. I get writing samples all the time. This wasn't a good example of good writing. And the poorly crafted story combined with an obvious "in Texas we know what hot is and those Easterners do not" stereo type, just didn't work well together.