Consider for a second why all state and federal taxing authorities offer 800 numbers to report fraud.  It is big business and anyone who reports the fraud anonymously can claim a 10% refund on any funds that are claimed as a result of a confidential tip.  It is commonly referred as the whistleblower laws.  But not all of them are on purpose; there are many ways that you can get caught by mistake. 

What may easily start out as a loving and trusted relationship within one's family and household can sour over time.  I've heard many horror stories about this.  Revenge is a powerful motivator and many people feel they are justified in pursuing this avenue when they are not treated fairly. 

It is almost impossible to recover from this once the flood gates are opened.  Then you have to hire a lawyer and/or accountant to mount your defense, all of which will take a tremendous amount of time, which you are not likely to have to begin with.  To add to the bad news, failure to report household employees (and associated taxes) on Schedule H of your income taxes constitutes tax fraud and there is not much of a defense you can mount; it's what's referred to as an open and shut case. Continuing down this path, tax fraud is a felony and if you possess any professional credentials, you are likely to lose them upon conviction.

At the end of the day, is all this really worth the risk?  For folks who have been down this path, they will all consistently say, it was one of the most horrible experiences of their lifetime.  The damage is irrevocable and you may never be able to recover from it.

How can we forget what happened to the career of Bernard Kerik, former New York City Police Commissioner and  President Bush's nominee for Secretary of Homeland Security or Caroline Kennedy Schlossberg, who had to withdraw her run for Senator when the same situation occurred.  These stories continue to pop up in the news and will likely remain out there until people stop thinking that this is not a big deal. 

Redlig Financial Services LLC provides a full range of household payroll services designed to take the pain out of the process.  Gone are the hassles and headaches with preparing a payroll and all of the tax forms that have to be filed on a monthly and quarterly basis.  Our checklist is designed to get you up and running in four weeks, streamlining a logistically complicated process.  To see the more information click on the following link: