Dangerously Off The Grid

Reply Fri 9 Jun, 2017 06:20 pm
I have friend in his early forties who has worked his entire life at a job that pays in cash daily (nothing illegal). He has a Social Security number but has never declared his income to federal or state . He lives alone with his mother in a house that she owns and will leave to him when she passes away. It will probably not be fully paid for when that happens unless there is some kind of home loan insurance that will cover that. He lives this way not so much because he is slyly evading the system but more because he "can't deal with it, far too complicated for him". I imagine he can continue like this indefinitely until his mother passes and the house is left to him. At that point I suspect great complications could ensue that would put him on the grid and result in his facing tax evasion charges. I wonder what others here with knowledge of laws related to this situation think about this.
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Reply Fri 9 Jun, 2017 09:31 pm
I'm not familiar with the law, but in the US, I believe they have only to appraise his net worth. If net worth increases, you can deduce there has been income at least equal to the change in net worth. This is the reason for all the intricate money laundering schemes.

Good to see you back, Pitter. Still in Columbia, or wherever?
Reply Sat 10 Jun, 2017 07:27 am
Thanks very much Roger. I'm not sure how the government could appraise his net worth, at least until his mother passes away and leaves the house to him. He is paid in cash daily and keeps all his income in coffee cans, no bank account, credit card etc. He is saving almost all of it and seems to think or at least hopes he'll survive on that in his old age. He's paid nothing into Social Security. I'm just concerned that he will get into big trouble with the IRS when he inherits the house.

Yes I am still in Colombia
Reply Sat 10 Jun, 2017 08:30 am
Pitter wrote:
He is saving almost all of it and seems to think or at least hopes he'll survive on that in his old age.

If it doesn't get stolen or lost, or worse. When i worked for our local Social Services in the 1970s, a social worker visiting an old woman found her lying in bed on around $50,000 equivalent in banknotes, mostly stained with feces and urine. It had to be given specialist cleaning before it could be banked on her behalf. That amount would be worth around $300,000 today.
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Reply Sat 12 Oct, 2019 07:18 pm

As far as working for cash goes, I've done it, I still kind of do a little cash income now but I hold the cash or I spend it, really cash earned by working can't really be used for much other than groceries & bills.
The thing is about working for cash is, there's a limit of what you make before filing a w9 but.... If I fix computers & sell them getting cash there's also a loophole for that under the tax laws like there is for many other things.
If He's working for someone for cash it's a contract, he does a service for a fee. Really the thing is, it's a contractual agreement whether its a verbal agreement or written (These are usually verbal) it's really noone elses concern, it definitely depends on the type of work he's doing. If he does odd Jobs he's definitely got nothing to worry about. If he's a mechanic or a welder or something like that he's all set too nothing to worry about.

The IRS isn't worried about him all that much, they're concerned more so about 10 different men named Jorge Sanchez all working on the same ONE Social Security number that belongs to a guy named Brian Smith. Brian smith is the one that would have some explaining to do whether it was done by his knowledge or not.
The IRS is also worried about that employer that's cooking the books to pay people in cash.
Now if he goes and makes a dumb ass decision like tries to pay for a brand new honda civic in all benjamins or something like that that's when he's going to wind up being investigated.
Also his credit must be Sh**.
If he's just not filing, The IRS will eventually figure him out & pay him a visit to do all his numbers they'll deduct his check if he owes but sometimes not sometimes it's a warning.
If he's not laundering money & not cooking his own books it's usually nothing major.
Personally I'd much prefer to do a nickel in a Federal Penitentiary for tax evasion than 6 months in County for assault and battery.
Either way it sounds like he really doesn't have anything serious like prison time to worry about.
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