Free Ebook.

Enter your email address:

Delivered by FeedBurner

« 10 Ways to Save on Prescription Drugs | Main | Investing Isn't Common Sense »

June 11, 2008


Feed You can follow this conversation by subscribing to the comment feed for this post.

I don't see any problem with the cash payment option, and don't think you should worry yourself about whether or not the company will pay the appropriate taxes. Paying tax is their responsibility, not yours. Now if they said to your face "Yeah, pay me in cash so I won't have to pay any taxes!" then I would have a problem doing it...

We've had the opposite happen. A guy did a ton of work on our property (he is our neighbor, so we knew how to track him down later if necessary...). At the end of the job, he asked to be paid in cash. I think he offered us a small discount (we were taken aback at his request for cash, since it was a great deal of money, so I doubt the discount came close to reflecting how much he likely would not be paying in taxes). We did what he asked, but I haven't been thrilled whenever I think about it. He did not say he wasn't going to pay taxes on that income, so I agree it is not our responsibility to ride herd on him. Still, we are in the "just take all of it" tax bracket, and he's....not! It's a quandary.

Discounts are a good thing, but when paying in cash and you suspect the receipient won't be paying taxes, you are just a responsible for the crime?

File a Form 1099 for the work at year's end, especially if you have his address and federal ID (SSN) number. That ensures that the government knows about the work done and the money paid for it.

The comments to this entry are closed.

Start a Blog


  • Any information shared on Free Money Finance does not constitute financial advice. The Website is intended to provide general information only and does not attempt to give you advice that relates to your specific circumstances. You are advised to discuss your specific requirements with an independent financial adviser. Per FTC guidelines, this website may be compensated by companies mentioned through advertising, affiliate programs or otherwise. All posts are © 2005-2012, Free Money Finance.