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Dangerously Off The Grid

 
 
Pitter
 
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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Type: Question • Score: 4 • Views: 684 • Replies: 3
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roger
 
  2  
Reply Fri 9 Jun, 2017 09:31 pm
@Pitter,
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?
Pitter
 
  2  
Reply Sat 10 Jun, 2017 07:27 am
@roger,
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
centrox
 
  1  
Reply Sat 10 Jun, 2017 08:30 am
@Pitter,
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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