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  • Off the books work...

    Hello,

    I've been doing chores for a neighbor for at least two years now (I am almost 18) and have been paid $25 a week. I've filed taxes for two years now (this year and 2006) because I've been employed in this time. Well, don't know what hit me but recently I thought about it and realized I should have reported the pay from my neighbor. I've reported everything else: interest, W2, just not the earnings from my neighbor. I won't justify it or make excuses, just never thought about it before to report it. Is there any thing I can do to fix it? I will report it from now on of course, but is there any way I can pay the taxes I owe from past years? How will this affect me in the hiring process?

    Additionally, I've had a savings account since I was 10 I think. Unless I received a 1099 (or whatever the form is for interest earned), I did not report interest on my own calculations and initiative. I don't know if I should have, can an 11 year old file taxes? but if I should have, same questions for this: how can I fix it? Will it hurt me?

    Thank you in advance.

  • #2
    First with respect to the bank interest. You are only requiored to report interest over a certain amount on each account in a given year. (I do not know what that amount is - you will need to check with IRS or an accountant.) If the bank did not send you an interest statement, that's a pretty good sign that it is not a reportable amount.

    With respect to wages earned while self employed as an independent contractor, again you need only report wages earned over a certain amount (and again, I do not know what that amount is - you will need to check). $25 per week, may put you in the reportable range, however, once you deduct your operating expenses as an independent contractor, you may be below the reporting threshhold. Again, you need to talk to an accountant.

    If you do need to report anything, you submit amended tax returns. But in reality, you probably don't owe anything.
    Last edited by L-1; 06-21-2008, 11:03 PM.
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    • #3
      Thanks for your reply.

      If it affects it at all, my neighbor did not report my payment on her taxes (as far as I know). I am just curious because I am sure a B.I. will ask my neighbor (who will be one of my main references) how I know her, and she will say what I do: chores for $25/week. I am sure the B.I. will check my tax reports, and see it's not on there, and then trouble. Regardless, though, I want to obey the law and fix my ignorance. Hence, I am trying to fix things in advance.

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