Extortion - how to deal with?

[Anonymous]

Anonymous wrote:As I've read more details here, I feel sorry for OP.
If I were hiring someone for two hours per weekday to drive my kids to/from school and activities, I would've thought of it as an alternative to Uber. I wouldn't have considered them a household employee, paid taxes, and issued a 1099 or whatever.
I can see where someone who is not savvy about taxes would make this mistake.

+1

It’s just a ride. I wouldn’t think about taxes and all that other stuff either.

Hope you get it worked out. I know it is stressful.

[Anonymous]

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Anonymous wrote:If I'm understanding correctly, you hired a babysitter. You paid that person under the table. Employers are responsible for paying taxes. A household employee cannot be an independent contractor. But you won't go to jail. You will have to pay what you owe to the government, and there will probably be penalties.

https://www.irs.gov/publications/p926#en_US_2023_publink100086725

How would OP pay the payroll taxes now if she doesn’t have the person’s SSN? Does the IRS just apply the funds based on the name OP supplies?

Heck, we don't even know if this person has the authorization to work because OP didn't do any of this. But the point is that all this person has to do is make a claim with the state of Virginia and OP is in hot water.

To pay payroll taxes on a babysitter for one to two hours of school? I admit I might have to pay taxes but I don’t need a babysitter anymore so it’s no longer a need and didn’t know this was an issue legitimately. I assume I would just have to pay the taxes along with penalties if the IRS came knocking. Which would likely be less than what is being asked to pay extra. I think the IRS understands part time childcare well enough to not put people in jail over some babysitting hours.

PP didn’t say you would go to jail. They are referring to the law in VA where the employee can sue you personally. You’ll be on the hook for all costs, including their legal fees. In VA the presumption is the person is an employee. You would then owe all back taxes on top of the judgement and costs.

The issue in this case is you said you have no documentation. So nothing in writing about her wage and hours that she worked per day? This person could make up anything and you’ll have to prove they are lying.

No there is documentation on monthly wages and receipts of payments. What is in it for them? They likely didn’t claim the money and it’s clear they were paid what is in writing. What do they get out of taking me to court? All the wages have been paid. Wouldn’t the discussion just be about taxes to the government?

You have no documentation- nothing on hours worked, nothing on wages to be paid. What’s in it for them is wage theft. They’ll claim they worked more hours or earned more per hour and you didn’t pay. How will you dispute that in court?

You have more to lose then them being late on filing taxes for last year.

How will they say that if they have no proof of additional hours and there is proof that they charged an hourly rate above minimum wage and agreed to a monthly rate which was paid. There is clear documentation of them asking for a monthly wage and receiving it.

They would be an hourly employee in Va. It would be very easy to create a log of hours that exceed your 1-2 hours per day and claim they worked it. Do you have timesheets or payroll statements with hours worked as required in Va? Did you pay them at least twice a month as required in Va? You keep saying monthly so I’m not sure if you are summing two payments or if you only paid once a month.

They asked for the money once a month.

Doesn’t matter. The law said you had to pay twice a month.

What about the timesheets and written pay statements referencing hours worked?

There are no timesheets. Just agreements on approximate hours and monthly charges.

+1

Who does timesheets for a ride? It’s a mutual agreement. Who says you have to be paid every 2 weeks. You don’t know what you are talking about. Overthinking!

[Anonymous]

Anonymous wrote:“I do not owe you any money. Do not contact me again. It will be considered harassment and I will exercise my legal rights accordingly.”

Send this message and nothing else, OP.

[Anonymous]

I’m not understanding anything you are saying but here’s my two cents. No one who was involved in under the table payment is going to call the irs on you because I guarantee they will not want the irs looking into them. Just ignore.

[Anonymous]

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Anonymous wrote:If I'm understanding correctly, you hired a babysitter. You paid that person under the table. Employers are responsible for paying taxes. A household employee cannot be an independent contractor. But you won't go to jail. You will have to pay what you owe to the government, and there will probably be penalties.

https://www.irs.gov/publications/p926#en_US_2023_publink100086725

How would OP pay the payroll taxes now if she doesn’t have the person’s SSN? Does the IRS just apply the funds based on the name OP supplies?

Heck, we don't even know if this person has the authorization to work because OP didn't do any of this. But the point is that all this person has to do is make a claim with the state of Virginia and OP is in hot water.

To pay payroll taxes on a babysitter for one to two hours of school? I admit I might have to pay taxes but I don’t need a babysitter anymore so it’s no longer a need and didn’t know this was an issue legitimately. I assume I would just have to pay the taxes along with penalties if the IRS came knocking. Which would likely be less than what is being asked to pay extra. I think the IRS understands part time childcare well enough to not put people in jail over some babysitting hours.

PP didn’t say you would go to jail. They are referring to the law in VA where the employee can sue you personally. You’ll be on the hook for all costs, including their legal fees. In VA the presumption is the person is an employee. You would then owe all back taxes on top of the judgement and costs.

The issue in this case is you said you have no documentation. So nothing in writing about her wage and hours that she worked per day? This person could make up anything and you’ll have to prove they are lying.

No there is documentation on monthly wages and receipts of payments. What is in it for them? They likely didn’t claim the money and it’s clear they were paid what is in writing. What do they get out of taking me to court? All the wages have been paid. Wouldn’t the discussion just be about taxes to the government?

You have no documentation- nothing on hours worked, nothing on wages to be paid. What’s in it for them is wage theft. They’ll claim they worked more hours or earned more per hour and you didn’t pay. How will you dispute that in court?

You have more to lose then them being late on filing taxes for last year.

How will they say that if they have no proof of additional hours and there is proof that they charged an hourly rate above minimum wage and agreed to a monthly rate which was paid. There is clear documentation of them asking for a monthly wage and receiving it.

They would be an hourly employee in Va. It would be very easy to create a log of hours that exceed your 1-2 hours per day and claim they worked it. Do you have timesheets or payroll statements with hours worked as required in Va? Did you pay them at least twice a month as required in Va? You keep saying monthly so I’m not sure if you are summing two payments or if you only paid once a month.

They asked for the money once a month.

Doesn’t matter. The law said you had to pay twice a month.

What about the timesheets and written pay statements referencing hours worked?

There are no timesheets. Just agreements on approximate hours and monthly charges.

+1

Who does timesheets for a ride? It’s a mutual agreement. Who says you have to be paid every 2 weeks. You don’t know what you are talking about. Overthinking!

OP originally referred to this person as a nanny and then a babysitter. Both are considered employees. Which means you are required to have pay statements and semi monthly pay checks.

It wasn’t until people repeatedly were telling OP that she messed up that the story of the person being like an Uber driver came out.

None of what OP says makes sense because she keeps trickle truthing.

[Anonymous]

Anonymous wrote:I’m not understanding anything you are saying but here’s my two cents. No one who was involved in under the table payment is going to call the irs on you because I guarantee they will not want the irs looking into them. Just ignore.

OP doesn’t understand it either. Every post a new unclear detail is added.

[Anonymous]

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Anonymous wrote:Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

No. No claim. She also wasn’t a nanny. She was a driver

Doesn’t matter. You still owe taxes and so does she.

No she doesn’t. You have to make at least 12k to file a tax return. OP is the only one that needed to pay taxes.

You assume that it was the employee’s only job, which seems unlikely given the low pay.

They have multiple clients and say they are part of a larger business.

I mean it would help a lot if you would just say what they are actually asking for and on whose behalf. But based on this last post of your OP I am going to surmise that the person you hired was in fact working for someone else and worked for you while on the clock for someone else. They got caught. They now are facing some kind of situation where they need to make restitution . They may or may not have an actual lawyer or maybe they consider google their lawyer and are trying to get you tot pay money to them so they can pay the restitution they owe.

Yes. This is what happened. They were mostly a driver but also did some other stuff for children. It got worked out and I think we are done. Thank you for helping me understand the situation more.

[Anonymous]

Anonymous wrote:

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Anonymous wrote:Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

No. No claim. She also wasn’t a nanny. She was a driver

Doesn’t matter. You still owe taxes and so does she.

No she doesn’t. You have to make at least 12k to file a tax return. OP is the only one that needed to pay taxes.

You assume that it was the employee’s only job, which seems unlikely given the low pay.

They have multiple clients and say they are part of a larger business.

I mean it would help a lot if you would just say what they are actually asking for and on whose behalf. But based on this last post of your OP I am going to surmise that the person you hired was in fact working for someone else and worked for you while on the clock for someone else. They got caught. They now are facing some kind of situation where they need to make restitution . They may or may not have an actual lawyer or maybe they consider google their lawyer and are trying to get you tot pay money to them so they can pay the restitution they owe.

Yes. This is what happened. They were mostly a driver but also did some other stuff for children. It got worked out and I think we are done. Thank you for helping me understand the situation more.

What does “it got worked out” mean?

[Anonymous]

Anonymous wrote:

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Anonymous wrote:Op did you 1099 the nanny or claim her on your taxes? If so, yes you owe her money because you messed with her taxes. Nannies are household employees.

No. No claim. She also wasn’t a nanny. She was a driver

Doesn’t matter. You still owe taxes and so does she.

No she doesn’t. You have to make at least 12k to file a tax return. OP is the only one that needed to pay taxes.

You assume that it was the employee’s only job, which seems unlikely given the low pay.

They have multiple clients and say they are part of a larger business.

I mean it would help a lot if you would just say what they are actually asking for and on whose behalf. But based on this last post of your OP I am going to surmise that the person you hired was in fact working for someone else and worked for you while on the clock for someone else. They got caught. They now are facing some kind of situation where they need to make restitution . They may or may not have an actual lawyer or maybe they consider google their lawyer and are trying to get you tot pay money to them so they can pay the restitution they owe.

Yes. This is what happened. They were mostly a driver but also did some other stuff for children. It got worked out and I think we are done. Thank you for helping me understand the situation more.

What does “it got worked out” mean?

It means OP paid them off to go away, which -- if they actually will -- makes sense if the amount asked for isn't that much.