I worked at an establishment for 4 years and in the last 6 months of my employment there my boss left and his replacement did not tax my income in that time, I didn’t realize how bad that is and a few times he paid me in cash but he mostly paid me with checks, I kept all of the checks but can’t figure out how much he paid me in total how do I go about handling this when I file my taxes?
A previous employer who I do not trust did not tax my income for 6 months, what should I do?
byu/ObligationStock9456 inpersonalfinance
Posted by ObligationStock9456
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You can demand a W-2 from your employer, and they are required to provide it by early February. For 2025, the general requirement is that the form must be submitted and transmitted to the recipient by February 2nd.
If you don’t receive a W-2, then you probably will need to submit a Form 4852, to document what wages you received, what was allocated to you, and what was withheld for taxes.
There’s the right way to do this and the, well, I wouldn’t call it the “normal” way but I can’t think of a better term.
The right way – Talk to an accountant or a tax attorney.
The “normal” way (I am not recommending this, just saying that I suspect most people who are in the situation you are in probably don’t have the money for an accountant or tax attorney) – You should get a W2 from the company. File your taxes with the figures shown on the W2, assuming that they aren’t claiming to have paid you more than they actually did. Let the IRS work out whether there are any discrepancies. If they find any, they will eventually send you a polite nastygram telling you how much more you owe. If it seems reasonable and you can afford it, pay it. If not, I refer you to the “right way” option.
If you don’t get a W2 by early February or if the W2 is claiming that you were paid more than you were, google “what should I do if I don’t get a w2” or “what should I do if my w2 is wrong” and follow those instructions.
Good luck and I hope it works out for you.
This is the “under the table” pay you hear about.
You should get documents from your employer declaring how much they paid you and how much they paid or collected various taxes on your behalf. Done right, this should include the cash. They should do this for their own tax benefits, and because it’s the right thing to do.
If the cash isn’t declared by them, the onus is on you to account for it. You may owe more in taxes and FICA, and if it’s enough, penalties as well.
If they don’t declare they paid you in cash, and you don’t declare it, that’s tax evasion. They may have done it on purpose, to satisfy you but stick it to the man, while you may be carelessly guilty of it.
If you deposited the cash in your bank, and the amount is significant enough, you may need to account for it, and possibly have to deal with it later through an audit.
If you didn’t deposit the cash, and didn’t use it to make significant or traceable purchases, it can be difficult for anyone to prove you received the cash or that you owe taxes for it.
Technically you’re obligated to report all the income you received and pay appropriate taxes and such. Realistically, there’s a little gray area or rounding error that doesn’t get attention, like small amounts of interest on checking accounts, and the occasional forgotten fiver we’re slipped by a neighbor for helping with a chore.
Six months of pay is likely too much to be seen as a rounding error situation.
You might want to seek actual tax advice, and work out how to estimate the income and pay the missed taxes. Especially if you’re working fairly consistently with hours and rates, probably double what you were paid in check form.