Getting paid "off the books" dilemma (I don't want to be)!Submitted by Ed Thinking on Mon, 11/04/2013 - 10:32
Interesting practical problem:
"I am retired and am working part time basically just to keep busy. I am also collecting social security but, due to my age, I can earn as much as I want without it reducing my SS so that isn’t an issue for me. I came across a job last Jan at a local business (a national franchise whose owner has just 1 store) where I can and do literally walk to work. The hours are good, the job is relatively easy and I enjoy working there.The dilemma is this. The owner refuses to pay me properly. He only wants to pay me “under the counter” and by check. I have been fighting him with this over the 10 months I have been working there. I WANT TO show this income and be paid properly. I have wrangled about 5 months “on the books” payments out of him but his other 2 employees (kids in their 20’s) have never been paid properly and don’t care (not my problem). Going forward in 2014 he refuses to pay me “properly.”I don’t want to quit. It’s just too convenient. My question is: Am ** I** “protected” from IRS issues if I simply report all the income (he pays me by check!!!) in January as misc income? I don’t care what happens to him for improper payroll procedures, just me. I do have a federal EIN number from a part time business I had and I could even report it as income for that business. I don’t really make enough there to even have to report estimated taxes but I do anyway.My concern is the legal (IRS, STATE) issues I may create FOR MYSELF working there. Am I “safe” if I simply report everything I get paid from him? Since the dummy pays me by check (that is his cash) if he gets audited HE’S screwed. I just don't want to give up the convenience of this."
Disclaimer: I am not the person that is facing this, I just thought it would be a good exercise how to apply liberty principles to a problem like this. If you want to respond directly to the person with the problem do so on the link on that site...