Risks of paying off the books

[Anonymous]

Anonymous wrote:People who pay off the book should be prosecuted and serve prison time as well as those who want to be paid off the books. But they are probably undocumented and can be expelled.

A lot don't want to mess up government aid, which should also be prosecuted, in my opinion, as it takes aid away from people who actually need it.

[Anonymous]

Well, if you and nanny part acrimoniously, she can file for unemployment and rat you out to qualify. She’ll owe a little. You’ll owe a shit ton of money in back taxes, penalties, a portion of the nanny’s taxes, AND you’ll likely be audited for past years plus be more likely to be audited in the future.

Don’t give in to nannies who want you to commit tax fraud. There are law abiding nannies out there.

[Anonymous]

Anonymous wrote:Well, if you and nanny part acrimoniously, she can file for unemployment and rat you out to qualify. She’ll owe a little. You’ll owe a shit ton of money in back taxes, penalties, a portion of the nanny’s taxes, AND you’ll likely be audited for past years plus be more likely to be audited in the future.

Don’t give in to nannies who want you to commit tax fraud. There are law abiding nannies out there.

This, no I’ve thought it would happen then Covid hit. Nannies who were paid under the table couldn’t file for unemployment.

[Anonymous]

Anonymous wrote:My neighbor's 19yo DD works as a nanny while she is home from college this summer. It is more like a mother's helper to a SAHM of 4 young kids. She is paid @ $100 a day "cash" to keep them company, take them to the pool and park and put the babies down for naps. She works 7 hours, 4 days a week M - Th.

I don't know for sure, but I would bet that she is not going to pay taxes on it. Her mom told me like it was a good thing that she has a "fun" job and is making so much more than she made previous summers.

My DD works retail at a local shop and makes $11 an hour. She does 6 hour shifts, 5 days a week, and is bring home HALF. I know it's wrong, but I would allow her to do somethinglike this nanny thing (off the books) she could find it.

She’s an idiot. She could be making at least $150/day.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My neighbor's 19yo DD works as a nanny while she is home from college this summer. It is more like a mother's helper to a SAHM of 4 young kids. She is paid @ $100 a day "cash" to keep them company, take them to the pool and park and put the babies down for naps. She works 7 hours, 4 days a week M - Th.

I don't know for sure, but I would bet that she is not going to pay taxes on it. Her mom told me like it was a good thing that she has a "fun" job and is making so much more than she made previous summers.

My DD works retail at a local shop and makes $11 an hour. She does 6 hour shifts, 5 days a week, and is bring home HALF. I know it's wrong, but I would allow her to do somethinglike this nanny thing (off the books) she could find it.

They might not be hitting the minimum threshold for domestic worker (somethng like 30k a year in md) so technically don’t have to but also your daughter is getting ss and unemployment stocked away which may come in handy later. I really worry about retirement for the lifetime off the books nannies. There are too many employers willing to screw them over.

$30k?!? The limit is actually $2,300 and it’s federal.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Well, if you and nanny part acrimoniously, she can file for unemployment and rat you out to qualify. She’ll owe a little. You’ll owe a shit ton of money in back taxes, penalties, a portion of the nanny’s taxes, AND you’ll likely be audited for past years plus be more likely to be audited in the future.

Don’t give in to nannies who want you to commit tax fraud. There are law abiding nannies out there.

This, no I’ve thought it would happen then Covid hit. Nannies who were paid under the table couldn’t file for unemployment.

Actually you are wrong.

When the pandemic hit - lots of nannies were let go. Because of the pandemic anyone could file for unemployment, even those under the table.

What happened was - nanny fills out all information (IE prior employment), nanny may or may not get unemployment (a lot did) and a letter from the IRS was sent to said employers (with all kinds of fun stuff written like back taxes, fees, etc).

Signed a nanny (who thankfully was never let go during the pandemic but knows hundreds of nannies who were some of whom were paid under the table. But thankfully the nanny relief fund was set up to help any nannies out of work)

[Anonymous]

Zoe Baird and Kimba Wood. Look them up!

[Anonymous]

Anonymous wrote:

Anonymous wrote:I have always wondered how the IRS doesn't catch this kind of tax fraud- how stupid are they? I mean 20/hr is 40k a year. You're not paying in physical cash, you're still writing checks, wiring money or venmo. There's a huge paper trail.

They catch it when you flaunt it and someone rats on you (posting lots of vacation pics with nanny while the neighbor 3 houses over knows you aren't paying her above board) or you become a big deal in the news - through crime (Derek Chauvin was busted for tax fraud only after he murdered someone on social media) or political/business infamy (the Nannygate/Trump effect).

Basically people who keep their head down are fine. The IRS isn't checking everyone's bank accounts.

My neighbor had a nanny off the books. He got audited for a different issue but the IRS found out about the nanny because of the cash withdrawals that were made from his checking on a weekly basis and at the end of the year. Penalties up the wazoo. Not worth it!

[Anonymous]

Anonymous wrote:

Anonymous wrote:I have always wondered how the IRS doesn't catch this kind of tax fraud- how stupid are they? I mean 20/hr is 40k a year. You're not paying in physical cash, you're still writing checks, wiring money or venmo. There's a huge paper trail.

They catch it when you flaunt it and someone rats on you (posting lots of vacation pics with nanny while the neighbor 3 houses over knows you aren't paying her above board) or you become a big deal in the news - through crime (Derek Chauvin was busted for tax fraud only after he murdered someone on social media) or political/business infamy (the Nannygate/Trump effect).

Basically people who keep their head down are fine. The IRS isn't checking everyone's bank accounts.

Teresa Giudice from Real Housewives of NJ
Jen Shah from Real Housewives of Salt Lake City
Dorit Kemsley Real Housewives of Beverly Hills

and about a half dozen others too.

If you're flaunting your wealth on TV, expect to get busted.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My neighbor's 19yo DD works as a nanny while she is home from college this summer. It is more like a mother's helper to a SAHM of 4 young kids. She is paid @ $100 a day "cash" to keep them company, take them to the pool and park and put the babies down for naps. She works 7 hours, 4 days a week M - Th.

I don't know for sure, but I would bet that she is not going to pay taxes on it. Her mom told me like it was a good thing that she has a "fun" job and is making so much more than she made previous summers.

My DD works retail at a local shop and makes $11 an hour. She does 6 hour shifts, 5 days a week, and is bring home HALF. I know it's wrong, but I would allow her to do somethinglike this nanny thing (off the books) she could find it.

They might not be hitting the minimum threshold for domestic worker (somethng like 30k a year in md) so technically don’t have to but also your daughter is getting ss and unemployment stocked away which may come in handy later. I really worry about retirement for the lifetime off the books nannies. There are too many employers willing to screw them over.

$30k?!? The limit is actually $2,300 and it’s federal.

+1 Any nanny who works more than a month or two is going to hit that limit.

[Anonymous]

Anonymous wrote:For them - tax fraud is huge if they don't account for their income. They also have to pay a higher tax rate to be 'self-employed'. Off the books also tends to have 'looser' contract terms. Will you even give them an employment contract? How will they enforce employment terms like sick leave, OT, and health care? What happens if you decide to just quit using them 2-months into a 1-year agreement?

For you - tax fraud and future employment security claims if someone finds out https://en.wikipedia.org/wiki/Nannygate

+1 This. If you pay them off the books, they have no fallback plan. They won't qualify for unemployment. This happened to our former nanny when due to COVID her employer dumped her with no notice as they opted to telework elsewhere. If she hadn't had a long work history on the books, she wouldn't have qualified for unemployment. The nanny of a friend of mine threw out her back lifting her toddler, and was disabled for 2 months. If your nanny works off the books, she has zero protections.

[Anonymous]

We have good friends who pay their nanny $65,000/year cash. It’s absolutely insane to me but she’s been with them for 3 1/2 years now and nothing has happened. I’d personally be way way too nervous.

[Anonymous]

Aww you are so unkind for the lady who said the commentary about undocumented people. Did you know Trump pay them to work at his hotels and golf places $8 por hour so he's taking advantage of them.Plus he don't pay taxes. sorry for your.