He takes a screenshot of a website called SmartAsset that has a free paycheck calculator. Paid biweekly at 80 hours, gross 2000, net 1560. Hours vary but that’s standard
So one of two possibilities:
1. His payroll software is screwed up and he's just doing thing manually
2. He's pretending to deduct money for taxes, but pocketing the difference likely due to money troubles.
Right on.. he claims his “program” doesn’t provide pay stubs and that’s the on thing that is throwing me off. But my concern again with that website, is it doesn’t ask for your state or any further information besides hours and wage then a screenshot of “estimated” taxes
If he is paying into the federal government he should be paying monthly. I have 3 employees, and I calculate their pay in quickbooks and qb does direct deposit less tax, SS, & Medicare.
The next month I log into EFTPS federal tax payment system, and I enter the totals for all three taxes into their system system, and then pay with auto deduction.
Quarterly I submit all the details for each employee.
I do a similar thing with the state withholding taxes.
Perhaps you can get screenshots of his eftps payment history, to verify he's actually making the payments.
It costs extra. And, when I bought this company, this is how they did it. I was busy making other changes and this was at the bottom of the list It's not much of a hassle.
No joke about the cost. My boss has the last version of quickbooks (i.e. not the brand newest). They quoted her something like 10 gramd to UPGRADE to the newest.
Not only does it cost extra, some of the options out there are downright silly expensive.
We did Patriot payroll because its cheap, takes care of all of the paperwork and deposits, and was like $4 an employee when we started, with an option to join a group plan to make it like $2. My accountant said to jump on it because his service for the same was much more expensive (we dontt use QB, I hate that software)
If you are paying for the Payroll feature of QuickBooks, turn on the auto and QB will file and pay your taxes for you. Even file your W2s and send your employees a copy. All you need to do is process paychecks.
\*This is just an option in QuickBooks Online
This. He could be doing payroll completely manually, but it is highly unlikely he has done everything he is responsible for correctly, considering the complexity of payroll taxation. It's far more likely he has not been remitting payroll taxes at all, either state if applicable and more definitely federal, and the IRS has no record of you earning any salary from him, let alone collected any of the taxes the boss has supposedly remitted on your behalf.
If they've only been operating since the beginning of 4th quarter 2021 , as OP said in another post, the boss is not too far behind, if he hurries and gets caught up now.
>his “program” doesn’t provide pay stubs
Then he's not using payroll software. Literally every payroll software does this. He's lying, the only questions are: 1) Why?; and 2) Do you still want to work for someone who's lying about something so fundamental?
He uses the website I listed in a few of the other replies and write my check based on the number given for “estimated take home pay”. I’ve questioned it since day one when he said “my paystubs are technically in my checkbook” but I let it slide and just kept knocking out jobs for him. We do concrete foundations and home rehabs so the money is definitely there and he thinks 25$ hr will keep me quiet considering I’m young and work harder when I’m pissed off to block it out
Working harder for a guy who may be trying to screw you to block out the fact that he may be trying to screw you is not where you should be putting your energies my man.
Unfortunately you’re right, but for the sake of everyone else of the job and to save the argument it’s the only way it works. Even when clearly wrong, he’s never wrong so there’s never a way you can get to him to get a point through
No offense, but you sounds like you really want to protect the feelings and interests of a person who is stealing from you and putting you in jeopardy. You need to rethink how you judge your own self-worth. You deserve better than this.
Definitely a toxic trait a carry daily, helps coming from a stranger who can sense that from nothing but a threat. Thank you very much for that reminder
You deserve better. You also need the pay stubs to file your own taxes.
As a hard worker, you will find other work. His other employees are adults and can make their own choices as well.
Your employer knows a young, hard worker when he sees one, which is why he doesn't want you to go, but knows there are others out there if you do.
>Any underpaid taxes r on U.
Under-withheld taxes are on OP.
Withheld, but not remitted taxes are **not** on OP. They are on the employer, and the IRS will pursue accordingly.
Hey man, I'll throw this out there:
My mother started a small home business (dog training and boarding) after my father died several years ago. After putting along almost breaking even for a few years, she made a few small changes and boom, blew up (relatively, she makes a good living and it's sustainable but she isn't Elon by any means).
I help her with the payroll and compliance stuff etc, and for the first year or so did things manually before getting software to do it. I paid the employee (yep just one lol) like this, but kept everything in an excel sheet. A couple of times the employee asked for paystubs etc, and it was relatively simple to give her the payroll Excell sheet along with a letter from mom stating this is her income any questions feel free to call blah blah blah. If he is really submitting quarterly witholding, futa, paying workers comp etc it's very easy to give some.sort of statement of what went to what taxes etc.
If he isn't willing to do this after a "boss, this is weird. I'm not saying something shady is going on, but I need to have records of what taxes are being paid and withheld and that they were actually submitted. This is supposed to be provided to me on request - I'm requesting", then man I woukd assume something shady is in fact going on, likely tax fraud.
I'm not tax or employment expert, I did have to learn the basics at least of this stuff to help mom tho. Plastered all over the irs income tax page is "while there are civil and criminal penalties for employers who fail to withhold appropriate taxes, it is ultimately YOUR responsibility to pay your taxes". Idk how aggressive they enforce it to the employees who have been shafted like this, but you are potentially on the hook too.
Good luck man.
That website does ask for state, allowances, and deductions - https://smartasset.com/taxes/paycheck-calculator - he just might not be capturing that in the screenshot. You say he's not providing paystubs but if your check is matching the net total on the screenshot then that's your paystub. I'm not sure if it meets the legal definition of a paystub but it's got the info you need.
Based on this information, I'm less inclined to think he's screwing you and more inclined to think he has no idea how to generate a W-2 after calculating your paychecks using a website calculator rather than payroll software.
This. After dealing with a LOT of small business owners that have been in over their head, this more sounds like a guy that is just trying to save the expense of a 3rd party payroll company. Really doesn't sound like he is trying to screw anyone, it sounds like he is not all that savvy with payroll functions and is doing what he can. There may be some issues later if he screwed something up, but jumping to the conclusion that he is doing something nefarious is premature, to say the least.
Yep, there was a similar post over the weekend. In both cases, the business owner is going to an awful lot of trouble to give a by-the-book appearance if they are in fact just out to screw the OPs. Paying straight under the table seems WAY easier.
It most DEFINITELY is, haha. But this employer has literally 2 employees. To immediately say he is a crook because his paystubs are screenshots is a bit ridiculous. People get their pitchforks out at the first hint of impropriety. 95% of the people commenting have no experience with which to give a reliable answer, yet they are given anyway.
You need to make it very clear that this is okay, if you are not going to get this information in time to prepare your tax return you will involve the authorities.
He is in violation of [Missouri Stat. §290.080](http://revisor.mo.gov/main/OneSection.aspx?section=290.080&bid=15293&hl=) unless he can provide you a specific, written accounting of the deductions from your stated rate of pay for **each** month you have been employed:
>Such corporations and persons either as a part of the check, draft or other voucher paying the wages or separately, shall furnish the employee at least once a month a statement showing the total amount of deductions for the period. Any corporation or person violating this section shall be deemed guilty of a misdemeanor, and upon conviction thereof shall be fined in any sum not less than fifty dollars, nor more than five hundred dollars, for each offense.
He must file a Form W-2 with the IRS by January 31 of this year, and furnish or mail it to you by the same date.
If this doesn't happen, you want to involve the Missouri Department of Labor and the IRS to straighten things out.
Back in 2004 I used some fly by night program like paychek.c0m and it absolutely gave a break down based on what I plugged in for each employee. I screenshot their stubs and printed them. I also actually paid payroll tax quarterly.
I'd contact social security for starters and see if deposits have been made in your name.
>He's pretending to deduct money for taxes, but pocketing the difference likely due to money troubles.
This is the IRS' problem, not your problem. As long as they are deducted you still get credit for paying taxes even if they don't actually get paid to the IRS.
If you care report it to the IRS / your state's labor dept. But if not or if you simply don't want to rock the boat then you should be fine as long as he reports it as withheld in Form W-2.
If he doesn't that's where things get spicy, you would want to ask him to fix it and if he won't file a Substitute W-2 with the proper information on it ([Form 4852](https://www.irs.gov/forms-pubs/about-form-4852) and if you want to report the violation [Form 3949-A](https://www.irs.gov/pub/irs-pdf/f3949a.pdf)). This will trigger an automatic IRS letter (mail audit) that he'd have to respond to.
January 31st is the deadline to file and give W2's to employees [https://www.ssa.gov/employer/filingDeadlines.htm](https://www.ssa.gov/employer/filingDeadlines.htm) have you asked when you will be receiving those so you can file your taxes?
If you receive your W2 and it's correct you have some proof things are being done better then you think, although it could be fraudulent too.
If not your more likely a 1099 employee and the taxes are your responsibility.
Personally I would be looking for another job. Now that you have some experience that should be easier.
So if you have no documentation and he won't provide it you can reach out to your state's labor board or [the US Department of Labor Wage and Hour Division](https://www.dol.gov/agencies/whd/contact/complaints). He's violating payroll processing laws by not giving you a pay stub with the required info on it. They will fix it and he will get fined.
If you want to do something that will make less waves I'd recommend just going to a CPA and having them contact him for you. They could straighten this whole mess out and if you pick a good CPA and they manage to just fix it for him they your boss might even hire them as his CPA since they'd already be familiar with the matter.
Based on what you said it sounds like this guy has absolutely no clue what he's doing. Never attribute to malice that which can be explained by incompetence. He might simply be cheap and have no clue, so somebody who's a professional just needs to sit him down and explain how the process works and what the rules are (and penalties for breaking them).
This is common is small businesses. You get somebody that knows one thing and they want to start a business (in your case construction) but they have no training or experience in all the other functions you need to operate like legal, HR, IT, accounting, etc and sometimes royally screw it up. But as the saying goes "if you think hiring professionals is expensive wait until you try amateurs."
I'd be shocked if this guy is actually withholding and remitting taxes and not just pocketing the money he doesn't pay OP. OP would be better off getting paid $25 as an independent contractor and paying his own taxes. OP, if you want to keep this job, I would try to convince the boss to do just that.
Neither you nor your "employer" can decide to make you 1099 contractor. The work, responsibilities, supervision/oversight, duties, etc determine your classification. This person cannot legally be called a 1099 contractor in his current position/duties. And he should not request to be classified as such.
This guy is stealing tax money from the IRS, you really think he cares about 1099 fraud? At least then OP will get his money and can pay his own taxes. Also, it's possible he does qualify as a 1099, it sounds like he's working on a job by job basis, being a 1099 contractor is pretty common in that situation.
No, it isn't common just because he is on a job by job basis, there are other necessary factors. If the employer controls what, how, and when it will be done....he is not an independent contractor. It sounds like his employer tells him where to go for his job, when do be there, when he can leave, and how the job will be completed. That is not a 1099 contractor. Also- no one has any proof he is committing tax fraud yet. He has literally 2 employees. I see this ALL the time from business owners "just trying to make it work". The truth is: many business owners of this size are FANTASTIC operators, and not very good businessmen. You are just making accusations based on a single fact from a single source. This is way more common than you would think.
Replacing one kind of tax fraud with another isn't going to impress the IRS.
If I were an auditor presented with such a claim, my first question would be, "so you knew what he was doing was likely tax fraud, why did you ask to be illegally classified as a 1099 instead of reporting him to { IRS | DOL | OTHER_AGENCY }?"
Jeez, I think QuickBooks online accounting and payroll is like $80 total each month for us and it does all of the work, including paying payroll taxes and all other taxes to the state and IRS. I think he's being shady.
if he can't afford quickbooks with payroll for a company with a handful of employees then the company has serious liquidity issues. Costs on this are low enough to be negligible to most businesses.
I have been dealing with small contractors for a very long time. Here's my advice: he has a few days to get you a proper W2. Until then, all you/we have are suspicions. I know you think this is abnormal and crazy...it isn't. You would be shocked how many small business owners do similar things.
Having said that: the most important thing here is: save those screenshots he sent. Between that and the checks stating "after taxes", you really don't have much to be worried about. It is a clear case of your employer demonstrating to you that he withheld taxes. If you like your job, there is no reason to freak out. If you don't - this situation is certainly not ideal and creates one more good reason to look for another one. But if this is the only issues: it really isn't an issue until he can't provide a W-2 by 1/31.
Quickbooks rental/business is 90$ for one time and can do this (I used it). For one person I wouldn't think 80$ a month would be justified when you can use the PC version.
Assuming you're taxed at 12%, he's taking $100 more than necessary.
Edit: I forgot about social security, state etc., But a perfectly even number is pretty unlikely.
Everyone is jumping to the conclusion that you are getting screwed. Calm down and don't act rash. Your boss MAY be dicking you over, but employer aren't REQUIRED to use a 3rd party payroll provider.
What they are required to do is remit the withholdings to the revenue agencies. There are still employers that process their own payroll.
When you started at the company, did they make you fill out an I-9 and W4?
If you didn't, there's no way your employer would know how much to withhold and how to report it without your information.
Edit: guys, no one is saying OP shouldn't get a paystub. What you guys are neglecting is that a paystub doesn't need to be a piece of paper that ADP or Paychex prepares. If the boss is providing screenshots with the gross amount, less withholdings and deductions (and I would think YTD amounts are required), this is effectively a paystub. I have yet to see any requirement that a paper paystub is provided.
I agree here. People are jumping to conclusions way too quickly.
When I was a loan officer I did 2-3 loans where the borrower was paid with hand written pay stubs. So imagine a check with a perforated edge off to the side where they would hand write the withholdings for FICA etc.
At first it seemed super sketch but we were able to verify it with the employer w-3.
Ends up the employers were small time old school operations who just did the calculations manually rather than use payroll software.
Yeah, all this strikes me as the rough equivalent to a guy who does his own taxes on paper. OP says that his Social Security earnings are properly showing up on the ssa.gov website, so OP's employer is filing stuff at least with the SSA.
It's stupid, like doing taxes on paper instead of through software, but it's not illegal or even necessarily shady. Just inefficient and bad for business.
It could be there are so few people working for this guy, it’s not worth the money to him. It was just my dad and I when I was doing the taxes. Why spend hundreds for just him and I?
Yeah nothing wrong with saving money and doing it yourself. If you don’t have a lot of employees the math isn’t hard or too administratively cumbersome.
yep got paid this way threw college working for a contractor (and the CEO/Financial Officer/Safety Coordinator/Bob's wife would do your taxes for you while cooking you dinner so long as you remembered to bring some dark chocolate and bourbon over with a 1040... but those were easier days)
I don't know. It is definitely unusual, but here's what I think. If this guy is playing games, it's not to fuck YOU over but the government. An employer is supposed to withhold taxes from you and remit to the government, but they also have to pay the ER portion of the payroll tax. What he would essentially be doing is committing fraud. IF he were committing this kind of fraud, it would be FUCKING asinine for him to put "after taxes" in the memo field to basically call out the fact that he is defrauding the federal and state governments.
Maybe this guy IS that dumb and he wants to pay you under the table, but for even less than he needs to by giving you the net amount, but it just seems odd that he would risk such significant penalties.
If he did get your info from the W4 than maybe he is making the quarterly required remittances to the tax authorities and he is just too cheap to buy the software to give you official stubs.
You'll know when you get your W2, and I'm pretty sure there are resources the government has to get your W2. The government wants to know about shit like this so that they can go after shady defrauding employers.
Out of curiosity what kind of business, and is your boss just a really old school sole proprietor without much admin support?
The I-9 is for worker eligibility status. It doesn’t affect your taxes, outside of establishing that you are eligible to work in the US.
I get it that people don’t like to jump to conclusions, but the writing is on the wall here. As a 25 year entrepreneur, everything you’re describing terrifies the shit out of me. Your boss may not be screwing you, but the chances are very, very slim considering the way he’s paying you and the delay in getting you your W2.
>I-9
An I-9 is also mandatory for the employer to complete no later than the 3rd day of employment. If they're not doing I-9s, it's quite possibly because they intend to pay under the table (even if they tell the employees they're paying taxes).
> Your boss MAY be dicking you over, but employer aren't REQUIRED to use a 3rd party payroll provider.
It's refreshing to revisit this thread the next day and see this is now the top comment.
As OP provided more details, the actual scenario seems radically different, and less nefarious, from their initial presentation. I'm inclined to think OP's employer is a small-business owner, completely new to this, and definitely trying. Falling a little short? Yeah, but it seems like just paying OP under the table would be easier if the employer was trying to avoid the extra effort.
But the vehicle of sharing that paystub isn't uniform. The employer is showing him screenshots of the calc of withholdings that is supposed to be remitted. For all intents and purposes those can be his paystubs.
There's no reason to jump to any conclusions about what this employer is doing without all the facts. Just because something is unusual, doesn't make it wrong.
You do get one extension, so at least that isn't a lie. But absolutely prepare to not have an accurate W4, and honestly to report him to your state or the federal board of labor if it does not match up.
https://www.irs.gov/taxtopics/tc154
> If your Form W-2 isn't available to you by January 31, 2022, or if your information is incorrect on these forms, contact your employer/payer. If you still haven't received the missing or corrected form by the end of February, you may call the IRS at 800-829-1040 for assistance. When you call, please have the following information available:
> Your name, address (including ZIP code), phone number, taxpayer identification number, and dates of employment,
> Your employer/payer's name, address (including ZIP code), and phone number,
> If known, your employer/payer's identification number.
> The IRS will contact the employer/payer for you and request the missing or corrected form. The IRS will also send you a Form 4852, Substitute for Form W-2, along with a letter containing instructions for you.
> If you don't receive the missing or corrected form in sufficient time to file your tax return, you may use Form 4852 to complete your return. Estimate your wages or the payments made to you and any taxes withheld and report them on Form 4852.
For safety reasons, always verify phone numbers provided in comments on an official website before calling. That includes toll-free numbers!
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You could now, as I'm not sure if it is/is not legal to be paid this way (who knows, if he actually is withholding maybe it is?), but it's never a bad idea.
This is accurate. Boss seems to be inefficient or inexperienced but is attempting to document right things and if consistent can absolutely just be the limits of a first time entrepreneur.
If happy with job, be patient.
The extension for filing W-2s is not automatic. It is only granted under specific circumstances. See line 7 [here](https://www.irs.gov/pub/irs-pdf/f8809.pdf). Unless this is his first year as a business, I doubt he will qualify.
Nooo - as an employer you don’t get an extension on providing your employees W-2s…
He should also provide a paystub showing how the withholding is broken out.
You can get a 30 day extension (until Mar 1 this year) in specific circumstances which he may feel he meets (first year in business). It must be filed on paper, can't be filed online.
More and more it sounds like he is having money problems and not dealing with it in a not responsible way. If I was you I would start looking for another job. It does not look like he is screwing you, but he is screwing himself. Things are unstable.
FYI, my wife had a job once, small family business, she was sometimes paid cash, sometimes check, but always with a stub that showed taxes withheld etc. And then she got a W2. I'd say this at least warrants a question to the owner.
Many many questions and requests have all rendered useless. Unfortunately turned here before I start to go any further. I have never had an issue with another company showing me pay stubs and where my money is going
So this is his first year in business? The extension form for W-2 filing allows for an extension in the first year of business.
Honestly (as an employer myself) I think it's 50/50 whether he's screwing you or just inexperienced and put off dealing with the filings.
Have you been working all year?
All the other time it has been running there has got to be someone who knows how to... and things suddenly going wrong under him sounds like a red flag
I’ve been working for this guy since September 27, beforehand he was my foreman at a previous company and I followed him out the door to this place which he owns (maybe his dad owns still I have zero clue). He’s the only one I deal with or see
I would bet he wants to do the right thing but hasn't set it up yet. He didn't have to remit taxes until after the 4th quarter last year. It sounds like he may be having trouble paperwork-wise - restarting an old business, registering with state/fed/local tax and unemployment agencies, etc., and if you are the only employee he probably doesn't want to pay for 3rd party administration. How is business? Does he seem upright in deal-making, etc.? The paperwork is NOT the fun or money-making part, and he may have put it off - not a wise thing to do, but certainly tempting.
Make an account at www.ssa.gov and see if your earnings are reported accurately. That will be a good sign if your boss is doing things legit on the backend.
Enter all of you information into this [paycheck calculator](https://www.paycheckcity.com/calculator/salary). Make sure to include hourly rate, number of hours per pay period, the amount of tax you elect to withhold based on the W4 you filled out, state for tax withholding purposes, and any deductions you have from your check. If the net pay doesn’t match then there is definitely something up. If the net does match then it’s still possible he is stealing, but this could give you a little more info.
Hanlon's razor: Never attribute to malice that which is adequately explained by stupidity. It's entirely possible that he's just a bad businessman. A few points I've read in this post I'll touch on based on my research.
1. He does not get an extension on when to provide you with a W-2. He is required by law to at least have it in the mail by Jan 31st. If you haven't received it by mid feburary, you need to contact the IRS.
2. A small bit of googling led me to believe that Missouri has laws that require him to provide you with a pay stub. Contact the state labor relations board to confirmation.
3. It's critical that you get either your paystub or w-2 asap. The reason why is because even if you don't have your w-2, taxes must still be filed by Apr 15th. You have options for an automatic 6 month extension but you're still required to pay any taxes due on Apr 15th but if you don't know what he's withheld, you don't know what you owe.
4. You can file your return without your w2 but things get a little more complicated at that point and you might want to seek an accountant if you have issues dealing with this.
5. Depending on how many people working for him, there may be a requirement to provide health insurance? did he do this? if not, and you didn't have it throughout the year, you may charged a fee (from the state, not federal).
6. A rule that I read one time about tax withholding is 25% of gross should go to taxes (Fed/FICA/SALT). Maybe that can apply here to see if he's pocketing your money under the guise of "taxes". Take the amount/hr you're supposed to be paid and subtract 25% from that. If you've received substantially less than that number, then chances are you're being screwed.
7. One final reason why it's absolutely critical you get access to your pay stub. It shows how many hours you worked and what the wage is. Without this, all you really have is your word vs his on how much you are supposed to be getting paid.
Good luck. I suspect at the end of all this, you'll end up making 2 calls. One to the state labor board and the other to the IRS as it sounds like he is just trying to skirt around his requirements and if so, you could be the one left holding the bag so to speak.
Ask him for a pay stub because you want to … buy a house or refinance or …. just invent a reason.
If he cant send one, bill him, raise your salary and pay your own deductions.
You’re 100% getting hosed.
Believe it or not the first time I asked for them a month and a half ago-ish I needed them because I had a chance to buy a house. He continued to tell me to use my bank statements as proof of income.. lol. Needless to say I don’t have that house
>You’re definitely getting screwed.
Nothing "definite" about it.
Possible? Yes.
More likely than most, also yes.
Definite? Absolutely not.
Based on the information OP has provided, there's no evidence that OP's boss is "paying \[OP\] under the table and pretending to withhold". What information we have *does* fit that scenario. It, however, also fits a scenario in which the boss is withholding and reporting to the IRS, and there's nothing sketchy other than the boss' organization skills.
You find a new job if he doesn't start paying you correctly, immediately. Or you're getting the total after taxes, then you'll have to pay taxes on it again
Check your state's department of labor, some states require paystubs with specific information and there could be penalties due to you as a result.
Granted, if you pursue this path it's best to assume you no longer have a job there.
When you say definitely you should understand the definition of the word. You are "likely" getting screwed would be a more apt description, there is a chance this person just doesn't do bookkeeping well. Finding out which one is happening would be better before burning a bridge.
Ok. Wait until March to see if you are going to get your W2. If you DO get your W2, then file taxes and see if the IRS complains, if not then I guess you are ok? Just make sure that you are having proper withholdings, you won't know this until you get your W2 I guess.
If you do not get the W2, ask him if he filed with the IRS, you can also call the IRS and ask them what to do if you do not get your W2, I have not had this happen so don't quite know what to tell you.
If they don't have any witholding you can actually file with the IRS and get your witholding back from them and they will bill him for it. Look for form SS-8 and fill that out, its not too bad.
Construction businesses are some of the more shady businesses anyone can swing a hammer, but not everyone understands business and taxes.
Your best bet is to wait until March and see if you get that W2. No need to overreact until then.
It’s January. Your employer must give you a W2 by the end of the month that shows your gross pay, all the taxes you paid (eg that your employer deducted and paid on your behalf) to the feds and state for 2021. If that happens the process they use is likely legit if unorthodox, but be sure to add up all the numbers and make sure it comes out to what you received. If they give you a 1099, then they are classifying you as an independent contractor and they stole those supposed taxes. if they give you nothing then they didn’t report anything to the IRS and it’s even more illegal. Both those scenarios are wage theft and you should report them to the US and MO departments of labor. Nonetheless you still owe taxes on the amount you actually received so file tax returns and pay the taxes while you pursue the back wages that were stolen. You should ask now when will I get my W2 for 2021 since it’s nearly the end of Jan.?
Have brought up numerous of these points on here to him yesterday at the end of the day and needless to say, he will not be giving me a w-2 by January 31st. Not sure how true the extension part of it is but March 1st is when he told me. After telling me if I didn’t like it I could come run the business myself or calm the fuck down
Seems very shady. I am guessing that he is keeping what he is "withholding". Or at least a portion of it. Did you get a W2 for 2021 yet? Does that seem to match what you really earned and what was withheld or are those numbers also short?
You're **not** being screwed. Your employer may be screwing himself if he doesn't get his act together.
The point of a paystub is to assure you that your gross and net pay are accurate.
* Since you see the screenshots, you have the gross pay information and can confirm it's correct.
* If net pay isn't correct, you may owe taxes or the government (federal and state) may owe you a refund. In the event that your employer isn't paying withholding taxes, that's on him, not on you.
When you file your taxes, there are provisions for "never got my W-2." You can use these provisions to file timely.
Yes, 100%.
So, so many comments here giving OP bad information, leading them to believe they will owe taxes on the full amount, that they are effectively 1099 workers, etc.
What state are you in? Although they can give you a check like the one that you described there are regulations on the information that they have to provide for you when you get paid. It doesn’t seem like that is getting done so I would recommend talking to the labor department then a lawyer.
I've had this same thing happen. The business owner had money troubles and was "deducting for taxes" but then never filed taxes. When tax time rolled around and I didn't get any paperwork (I had quit by then) I reported this to the IRS. Unfortunately the business owner didn't get jammed up because he just ignored the IRS. His former business partner ended up having to pay because he is a responsible guy. I felt bad.
I believe you will have the answer shortly. Your employer will need to provide documents so that you can pay taxes and that should include all the withholding information.
HR chiming in. You have a right to receive pay stubs. Also, create an account in the Social Security website, to verify if Medicare and SS payments are being made and credited to your account.
A couple of decades ago I got a job doing the books for a small company with 8 employees. By the 3rd day there I realized he had been taking out Social Security, FICO, federal and state income taxes from his employees and was sending in none of it.
I spent the next day gathering evidence and at the end of the day I quit. Because of the evidence I gathered, I was granted unemployment despite quitting because his actions amounted to fraud etc. etc.
You could end up owing taxes because he collected them and didn't pay them, so yes you are being screwed. But more likely than not, is not reporting your income at all, which screws you out of Social Security earnings. Any way you look at it you're getting screwed, get out as soon as you can.
Gather evidence, if you can, it will bolster your case if you have to file for unemployment.
OP, please report that you have not received your w-2 on Jan 31 to IRS. Apparently IRS does not grant extensions for filing w-2 deadline except in very specific circumstances.... there is a high likelihood your boss is lying and he has not paid any payroll taxes......
https://www.irs.gov/newsroom/irs-to-employers-remember-february-1-2021-deadline-for-form-w-2-other-wage-statements
This is not legal advice.
If he is saying that he’s paying you after taxes, meaning that he is paying you a smaller amount than you would get if you elected not to withhold taxes, and he’s not actually withholding anything, you could potentially also have a claim for withheld wages. If you end up holding the bag for your income taxes, you’re essentially being paid at lower wage than what your boss represented to you.
Idk if you have a contract or work for a set hourly rate, but either way you should consider filing a complaint with the department of labor, and then getting another job.
That's correct, of he's not reporting your withholding to the IRS, your basically a 1099 employee and will be responsible for paying tax and self employment tax on all your earnings, essentially giving you a pay cut.
Photos of the checks with the "after taxes" notation would help prove that they understood that they were we. The wr may have immediately gone into file 13.
>That's correct, of he's not reporting your withholding to the IRS, your basically a 1099 employee
I don't think that's correct. If OP is under the (reasonable) understanding that he's a W2 employee, and the boss tells him he's withholding taxes but in fact is pocketing them/doing something else, that's squarely on the boss--and the IRS will pursue accordingly.
You don't become a 1099 employee because your employer didn't fulfill their responsibilities to the IRS.
This is not correct. OP can file a substitute W-2 with their return if they don't get a W-2. They will have to make estimates and explain how they came up with the numbers.
https://www.irs.gov/pub/irs-pdf/f4852.pdf
If if you end up being a 1099 emplyee, you need to start recording ALL your expenses as a 1099 employee, all miles driven, any expenses, any home use etc... I suggest getting this information curated now while it's still fresh in your memory.
It’s pretty simple here, you’re getting screwed. No “employer” does this. Period.
There are no extensions for an employer to provide a W2 after January 31.
I run businesses and have had my own. Nothing works that way. If you’re here asking the question you probably already know the answer. Now it comes down to your level of risk tolerance for staying with a “company” probably not providing retirement benefits or reporting social security payments on your behalf. Let alone unemployment insurance.
Good luck 🍀
No that’s late he has to get it to you by 31st or he will receive a fine.
Because with payroll nothing should’ve changed and deadlines to pay taxes on employees don’t work that way. He owed them on your behalf and for employing you last year. Business has until April. Individuals are due that form by end of January
Tell us your state, hourly wage, hours worked or total made and we can’t help figure out what is should look like. I hate it when I hear stuff like this. If people can’t do it by book don’t have employees. Good for you for questioning and being on top of it
W2 season is here… if you don’t get one from him and instead hands you a 1099, then yes he screwed you. I’d ask for your full wage back so you can pay your taxes. If he refuse, threaten to report your revenue and labor and licensing agency and follow through with that threat if he refuses to pay you what he pocketed. As a 1099 independent contractor, you’re going to have to remit the “employer”portion of taxes that they pay for their employees, which means you’ll have to pay double, the portion the employer usually pay and your own.
If it was me, I’d quit if he’s been screwing you. This is shady AF.
Keep copies of the checks that say “after tax” on them. If he isn’t dealing with taxes due to incompetence or malice, that is pretty good evidence of his fraud and your innocence in this and will be useful if you have to engage with the department of labor or the IRS.
I can tell you that the DOL, in my experience, will be very helpful to you in the event that you need them to remind your employer of their responsibilities.
My dad was real old school and for 12 years I was paid with a check exactly how the op described. It was inconvenient for sure and anytime I would have to produce proof of income somewhere it would be slightly annoying, but it wasn't the end of the world. The employer would be in a ridiculous amount of trouble if he wasn't withholding taxes from your paycheck. I mean he's using checks which have a paper trail so that alone should ease your mind a little. You should be able to figure out your weekly gross pay, take out the taxes for your state, and it should match up with the checks he is writing you. Come tax time you will get a W-2.
I don't know that there's a requirement that he gives you a paystub every check although it makes perfect sense, but there is a requirement that he tells the government how much he retained from your paycheck and forwards that money to them. I'm sure you can verify that he is actually doing it. He also needs to give you a W2 with all that information every year.
What he is doing is pretty much the same as if he was doing it manually. You can use Paycheck calculator and verify the amounts, it seems to be pretty good from what I've seen about it .
I had a boss do this once. He screwed me. When I did my taxes, I found out he never actually paid anything that he was supposedly taking from me.
If you are on the books, you need a pay stub.
I'm pretty sure in most locations the law requires employer to give you a detailed paystub showing all the deductions. The odds you're being screwed (or even more likely the employer is skipping out on paying taxes) is approaching 100%.
Report him to the state's comptroller. Because if he's cheating you he's also likely cheating the government. They will demand verification and documentation of him for their side, if he goes to prison he goes to prison.
In short. If you think that your boss may be fucking you over and doing something illegal. Make sure that they get what they deserve.
You don't even need to worry about gathering that. Because the comptroller will subpoena all of that from them. And the burden of proof in anything involving taxes is on the person who the inquiry is made of. You can file an anonymous report to the comptroller and if you're terminated you're protected by the EEOC. You don't even need to do the leg work of having questionable paperwork from your side.
Have you considered having a conversation? Assume good intent and ask your boss some questions. Something like, I really like working here and you’ve been an amazing boss. It’s time we had a lot bit of a difficult conversation about money and taxes. I really need to know that I can count on you to do all the withholdings correctly, and this isn’t something that I can just take your word on or anyone’s word on really. I really need to see all the numbers for the withholdings, and I need a W2. Can you please do this for me?
Have absolutely considered this conversation and have in fact brought it up, given him time to gather anything he would need, and waited all to receive nothing. He’s had plenty of chances to simply show me a paystub so I have some peace of mind. SSA.gov number reported are WAYY off but then again he doesn’t have W2s either
You need to look for a new job. I wouldn't consider that over reacting. I'd be concerned about tax implications and the KGB I mean IRS coming after both of you. What is he withholding? Is he issuing a W2 etc? Get an accountants, and a lawyers advice asap!
You’re likely being screwed and your boss isn’t paying the taxes being deducted from your earnings. Can you contact state Dept of Revenue/IRS to see if they can tell you if there’s a record of tax payment?
You’re going to be hit with a huge tax bill on $40,560 ($1560 x 26) when you file taxes. There’s no records of you paying any taxes into the government. Sounds like he offered you pay of 52k and is subtracting what the website tells him you will net. So to the government, your pay was 40k and you’ll pay taxes on that. I’d be really surprised if he has tax documents at the end of the year for you. This is definitely fucked. Most people use that site just to budget and have a decent idea of what they’ll be bringing home after taxes. There’s probably even a disclaimer on the tool he is using that says this is an estimate.
>You’re going to be hit with a huge tax bill on $40,560 ($1560 x 26) when you file taxes
Very, very unlikely.
>There’s no records of you paying any taxes into the government.
There are records of the boss withholding pay for tax purposes, imperfect as they are. Whether they are being forwarded to the govt. or not is the *employer's* problem, not OP's.
>So to the government, your pay was 40k and you’ll pay taxes on that.
This is incorrect. If OP can show how many hours they worked, what their rate per hour is, and that their pay was adjusted for withholdings (and from their comments it sounds like they have documentation to support all of this), the IRS will pursue the boss, not OP.
I wonder if he is paying into your SSI and Unemployment/Disability fund. If not you are being screwed...
I also would guess he is going to have a hard time creating a W2 for you and probably has not been paying your income tax liabilities.
You will be help responsible for these things if/when he skips town.
You may be getting screwed. Need some numbers. How often are you paid? What's the expected gross amount of the check? What was the net amount?
He takes a screenshot of a website called SmartAsset that has a free paycheck calculator. Paid biweekly at 80 hours, gross 2000, net 1560. Hours vary but that’s standard
So one of two possibilities: 1. His payroll software is screwed up and he's just doing thing manually 2. He's pretending to deduct money for taxes, but pocketing the difference likely due to money troubles.
Right on.. he claims his “program” doesn’t provide pay stubs and that’s the on thing that is throwing me off. But my concern again with that website, is it doesn’t ask for your state or any further information besides hours and wage then a screenshot of “estimated” taxes
If he is paying into the federal government he should be paying monthly. I have 3 employees, and I calculate their pay in quickbooks and qb does direct deposit less tax, SS, & Medicare. The next month I log into EFTPS federal tax payment system, and I enter the totals for all three taxes into their system system, and then pay with auto deduction. Quarterly I submit all the details for each employee. I do a similar thing with the state withholding taxes. Perhaps you can get screenshots of his eftps payment history, to verify he's actually making the payments.
Any reason why you don't just have your payroll software do all this for you?
It costs extra. And, when I bought this company, this is how they did it. I was busy making other changes and this was at the bottom of the list It's not much of a hassle.
It is amazing how much money you can save by clicking a couple buttons in QB and spending < 10 min doing certain tasks yourself.
No joke about the cost. My boss has the last version of quickbooks (i.e. not the brand newest). They quoted her something like 10 gramd to UPGRADE to the newest.
Not only does it cost extra, some of the options out there are downright silly expensive. We did Patriot payroll because its cheap, takes care of all of the paperwork and deposits, and was like $4 an employee when we started, with an option to join a group plan to make it like $2. My accountant said to jump on it because his service for the same was much more expensive (we dontt use QB, I hate that software)
If you are paying for the Payroll feature of QuickBooks, turn on the auto and QB will file and pay your taxes for you. Even file your W2s and send your employees a copy. All you need to do is process paychecks. \*This is just an option in QuickBooks Online
There is no payroll software that wouldn't produce paystubs. There is no program and he's likely done something illegal malicious or not.
This. He could be doing payroll completely manually, but it is highly unlikely he has done everything he is responsible for correctly, considering the complexity of payroll taxation. It's far more likely he has not been remitting payroll taxes at all, either state if applicable and more definitely federal, and the IRS has no record of you earning any salary from him, let alone collected any of the taxes the boss has supposedly remitted on your behalf.
If they've only been operating since the beginning of 4th quarter 2021 , as OP said in another post, the boss is not too far behind, if he hurries and gets caught up now.
He needs to be actually remitting these funds to the taxing entities each month. That is the part that seems like it is missing.
>his “program” doesn’t provide pay stubs Then he's not using payroll software. Literally every payroll software does this. He's lying, the only questions are: 1) Why?; and 2) Do you still want to work for someone who's lying about something so fundamental?
He uses the website I listed in a few of the other replies and write my check based on the number given for “estimated take home pay”. I’ve questioned it since day one when he said “my paystubs are technically in my checkbook” but I let it slide and just kept knocking out jobs for him. We do concrete foundations and home rehabs so the money is definitely there and he thinks 25$ hr will keep me quiet considering I’m young and work harder when I’m pissed off to block it out
Working harder for a guy who may be trying to screw you to block out the fact that he may be trying to screw you is not where you should be putting your energies my man.
Unfortunately you’re right, but for the sake of everyone else of the job and to save the argument it’s the only way it works. Even when clearly wrong, he’s never wrong so there’s never a way you can get to him to get a point through
I doubt the department of labor will care how stubborn he is
No offense, but you sounds like you really want to protect the feelings and interests of a person who is stealing from you and putting you in jeopardy. You need to rethink how you judge your own self-worth. You deserve better than this.
Definitely a toxic trait a carry daily, helps coming from a stranger who can sense that from nothing but a threat. Thank you very much for that reminder
You deserve better. You also need the pay stubs to file your own taxes. As a hard worker, you will find other work. His other employees are adults and can make their own choices as well. Your employer knows a young, hard worker when he sees one, which is why he doesn't want you to go, but knows there are others out there if you do.
yah, if that’s the case I extra recommend getting new job asap! good luck mate
As an aside, did he give you a W-2 for 2021?
U may b losing out on contributions to SS would b my biggest concern. Any underpaid taxes r on U.
>Any underpaid taxes r on U. Under-withheld taxes are on OP. Withheld, but not remitted taxes are **not** on OP. They are on the employer, and the IRS will pursue accordingly.
Did you fill out a w4?
Hey man, I'll throw this out there: My mother started a small home business (dog training and boarding) after my father died several years ago. After putting along almost breaking even for a few years, she made a few small changes and boom, blew up (relatively, she makes a good living and it's sustainable but she isn't Elon by any means). I help her with the payroll and compliance stuff etc, and for the first year or so did things manually before getting software to do it. I paid the employee (yep just one lol) like this, but kept everything in an excel sheet. A couple of times the employee asked for paystubs etc, and it was relatively simple to give her the payroll Excell sheet along with a letter from mom stating this is her income any questions feel free to call blah blah blah. If he is really submitting quarterly witholding, futa, paying workers comp etc it's very easy to give some.sort of statement of what went to what taxes etc. If he isn't willing to do this after a "boss, this is weird. I'm not saying something shady is going on, but I need to have records of what taxes are being paid and withheld and that they were actually submitted. This is supposed to be provided to me on request - I'm requesting", then man I woukd assume something shady is in fact going on, likely tax fraud. I'm not tax or employment expert, I did have to learn the basics at least of this stuff to help mom tho. Plastered all over the irs income tax page is "while there are civil and criminal penalties for employers who fail to withhold appropriate taxes, it is ultimately YOUR responsibility to pay your taxes". Idk how aggressive they enforce it to the employees who have been shafted like this, but you are potentially on the hook too. Good luck man.
That website does ask for state, allowances, and deductions - https://smartasset.com/taxes/paycheck-calculator - he just might not be capturing that in the screenshot. You say he's not providing paystubs but if your check is matching the net total on the screenshot then that's your paystub. I'm not sure if it meets the legal definition of a paystub but it's got the info you need. Based on this information, I'm less inclined to think he's screwing you and more inclined to think he has no idea how to generate a W-2 after calculating your paychecks using a website calculator rather than payroll software.
This. After dealing with a LOT of small business owners that have been in over their head, this more sounds like a guy that is just trying to save the expense of a 3rd party payroll company. Really doesn't sound like he is trying to screw anyone, it sounds like he is not all that savvy with payroll functions and is doing what he can. There may be some issues later if he screwed something up, but jumping to the conclusion that he is doing something nefarious is premature, to say the least.
Yep, there was a similar post over the weekend. In both cases, the business owner is going to an awful lot of trouble to give a by-the-book appearance if they are in fact just out to screw the OPs. Paying straight under the table seems WAY easier.
It most DEFINITELY is, haha. But this employer has literally 2 employees. To immediately say he is a crook because his paystubs are screenshots is a bit ridiculous. People get their pitchforks out at the first hint of impropriety. 95% of the people commenting have no experience with which to give a reliable answer, yet they are given anyway.
This website does a simple calculation, it doesn't actually report anything.
You need to make it very clear that this is okay, if you are not going to get this information in time to prepare your tax return you will involve the authorities. He is in violation of [Missouri Stat. §290.080](http://revisor.mo.gov/main/OneSection.aspx?section=290.080&bid=15293&hl=) unless he can provide you a specific, written accounting of the deductions from your stated rate of pay for **each** month you have been employed: >Such corporations and persons either as a part of the check, draft or other voucher paying the wages or separately, shall furnish the employee at least once a month a statement showing the total amount of deductions for the period. Any corporation or person violating this section shall be deemed guilty of a misdemeanor, and upon conviction thereof shall be fined in any sum not less than fifty dollars, nor more than five hundred dollars, for each offense. He must file a Form W-2 with the IRS by January 31 of this year, and furnish or mail it to you by the same date. If this doesn't happen, you want to involve the Missouri Department of Labor and the IRS to straighten things out.
Back in 2004 I used some fly by night program like paychek.c0m and it absolutely gave a break down based on what I plugged in for each employee. I screenshot their stubs and printed them. I also actually paid payroll tax quarterly. I'd contact social security for starters and see if deposits have been made in your name.
>He's pretending to deduct money for taxes, but pocketing the difference likely due to money troubles. This is the IRS' problem, not your problem. As long as they are deducted you still get credit for paying taxes even if they don't actually get paid to the IRS. If you care report it to the IRS / your state's labor dept. But if not or if you simply don't want to rock the boat then you should be fine as long as he reports it as withheld in Form W-2. If he doesn't that's where things get spicy, you would want to ask him to fix it and if he won't file a Substitute W-2 with the proper information on it ([Form 4852](https://www.irs.gov/forms-pubs/about-form-4852) and if you want to report the violation [Form 3949-A](https://www.irs.gov/pub/irs-pdf/f3949a.pdf)). This will trigger an automatic IRS letter (mail audit) that he'd have to respond to.
2 is what I was thinking. Making up can end up owing taxes
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I would agree except OP said the guy is withholding taxes.
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Nothing whatsoever
January 31st is the deadline to file and give W2's to employees [https://www.ssa.gov/employer/filingDeadlines.htm](https://www.ssa.gov/employer/filingDeadlines.htm) have you asked when you will be receiving those so you can file your taxes? If you receive your W2 and it's correct you have some proof things are being done better then you think, although it could be fraudulent too. If not your more likely a 1099 employee and the taxes are your responsibility. Personally I would be looking for another job. Now that you have some experience that should be easier.
Slight Correction - January 31st is the deadline to get the W2s mailed out. They are allowed to arrive in February.
So if you have no documentation and he won't provide it you can reach out to your state's labor board or [the US Department of Labor Wage and Hour Division](https://www.dol.gov/agencies/whd/contact/complaints). He's violating payroll processing laws by not giving you a pay stub with the required info on it. They will fix it and he will get fined. If you want to do something that will make less waves I'd recommend just going to a CPA and having them contact him for you. They could straighten this whole mess out and if you pick a good CPA and they manage to just fix it for him they your boss might even hire them as his CPA since they'd already be familiar with the matter. Based on what you said it sounds like this guy has absolutely no clue what he's doing. Never attribute to malice that which can be explained by incompetence. He might simply be cheap and have no clue, so somebody who's a professional just needs to sit him down and explain how the process works and what the rules are (and penalties for breaking them). This is common is small businesses. You get somebody that knows one thing and they want to start a business (in your case construction) but they have no training or experience in all the other functions you need to operate like legal, HR, IT, accounting, etc and sometimes royally screw it up. But as the saying goes "if you think hiring professionals is expensive wait until you try amateurs."
I'd be shocked if this guy is actually withholding and remitting taxes and not just pocketing the money he doesn't pay OP. OP would be better off getting paid $25 as an independent contractor and paying his own taxes. OP, if you want to keep this job, I would try to convince the boss to do just that.
Neither you nor your "employer" can decide to make you 1099 contractor. The work, responsibilities, supervision/oversight, duties, etc determine your classification. This person cannot legally be called a 1099 contractor in his current position/duties. And he should not request to be classified as such.
This guy is stealing tax money from the IRS, you really think he cares about 1099 fraud? At least then OP will get his money and can pay his own taxes. Also, it's possible he does qualify as a 1099, it sounds like he's working on a job by job basis, being a 1099 contractor is pretty common in that situation.
No, it isn't common just because he is on a job by job basis, there are other necessary factors. If the employer controls what, how, and when it will be done....he is not an independent contractor. It sounds like his employer tells him where to go for his job, when do be there, when he can leave, and how the job will be completed. That is not a 1099 contractor. Also- no one has any proof he is committing tax fraud yet. He has literally 2 employees. I see this ALL the time from business owners "just trying to make it work". The truth is: many business owners of this size are FANTASTIC operators, and not very good businessmen. You are just making accusations based on a single fact from a single source. This is way more common than you would think.
Replacing one kind of tax fraud with another isn't going to impress the IRS. If I were an auditor presented with such a claim, my first question would be, "so you knew what he was doing was likely tax fraud, why did you ask to be illegally classified as a 1099 instead of reporting him to { IRS | DOL | OTHER_AGENCY }?"
Jeez, I think QuickBooks online accounting and payroll is like $80 total each month for us and it does all of the work, including paying payroll taxes and all other taxes to the state and IRS. I think he's being shady.
I’ve recommended it many times and says he isn’t made of money and ignores the rest
if he can't afford quickbooks with payroll for a company with a handful of employees then the company has serious liquidity issues. Costs on this are low enough to be negligible to most businesses.
Me and one other guys is all he employs
I have been dealing with small contractors for a very long time. Here's my advice: he has a few days to get you a proper W2. Until then, all you/we have are suspicions. I know you think this is abnormal and crazy...it isn't. You would be shocked how many small business owners do similar things. Having said that: the most important thing here is: save those screenshots he sent. Between that and the checks stating "after taxes", you really don't have much to be worried about. It is a clear case of your employer demonstrating to you that he withheld taxes. If you like your job, there is no reason to freak out. If you don't - this situation is certainly not ideal and creates one more good reason to look for another one. But if this is the only issues: it really isn't an issue until he can't provide a W-2 by 1/31.
Quickbooks rental/business is 90$ for one time and can do this (I used it). For one person I wouldn't think 80$ a month would be justified when you can use the PC version.
Assuming you're taxed at 12%, he's taking $100 more than necessary. Edit: I forgot about social security, state etc., But a perfectly even number is pretty unlikely.
He's supposed to be deducting FICA though as well. No? 6.2% for Social Security 1.45% for Medicare
And some state tax, which is probably vaguely estimated by the web site the employer uses based on national averages.
Good point, thanks
Not sure if OP is in St Louis or not, but St Louis City takes a 1% tax on your income if you live or work within the city.
he may be just lazy or not have accountant etc
Everyone is jumping to the conclusion that you are getting screwed. Calm down and don't act rash. Your boss MAY be dicking you over, but employer aren't REQUIRED to use a 3rd party payroll provider. What they are required to do is remit the withholdings to the revenue agencies. There are still employers that process their own payroll. When you started at the company, did they make you fill out an I-9 and W4? If you didn't, there's no way your employer would know how much to withhold and how to report it without your information. Edit: guys, no one is saying OP shouldn't get a paystub. What you guys are neglecting is that a paystub doesn't need to be a piece of paper that ADP or Paychex prepares. If the boss is providing screenshots with the gross amount, less withholdings and deductions (and I would think YTD amounts are required), this is effectively a paystub. I have yet to see any requirement that a paper paystub is provided.
I agree here. People are jumping to conclusions way too quickly. When I was a loan officer I did 2-3 loans where the borrower was paid with hand written pay stubs. So imagine a check with a perforated edge off to the side where they would hand write the withholdings for FICA etc. At first it seemed super sketch but we were able to verify it with the employer w-3. Ends up the employers were small time old school operations who just did the calculations manually rather than use payroll software.
Did this for the first 20 years of business. Just got quickbooks payroll 7 years ago. Maybe should have done it sooner but eh.
Yeah, all this strikes me as the rough equivalent to a guy who does his own taxes on paper. OP says that his Social Security earnings are properly showing up on the ssa.gov website, so OP's employer is filing stuff at least with the SSA. It's stupid, like doing taxes on paper instead of through software, but it's not illegal or even necessarily shady. Just inefficient and bad for business.
It could be there are so few people working for this guy, it’s not worth the money to him. It was just my dad and I when I was doing the taxes. Why spend hundreds for just him and I?
Yeah nothing wrong with saving money and doing it yourself. If you don’t have a lot of employees the math isn’t hard or too administratively cumbersome.
yep got paid this way threw college working for a contractor (and the CEO/Financial Officer/Safety Coordinator/Bob's wife would do your taxes for you while cooking you dinner so long as you remembered to bring some dark chocolate and bourbon over with a 1040... but those were easier days)
I only filled out a w4. No I-9 was attached
I don't know. It is definitely unusual, but here's what I think. If this guy is playing games, it's not to fuck YOU over but the government. An employer is supposed to withhold taxes from you and remit to the government, but they also have to pay the ER portion of the payroll tax. What he would essentially be doing is committing fraud. IF he were committing this kind of fraud, it would be FUCKING asinine for him to put "after taxes" in the memo field to basically call out the fact that he is defrauding the federal and state governments. Maybe this guy IS that dumb and he wants to pay you under the table, but for even less than he needs to by giving you the net amount, but it just seems odd that he would risk such significant penalties. If he did get your info from the W4 than maybe he is making the quarterly required remittances to the tax authorities and he is just too cheap to buy the software to give you official stubs. You'll know when you get your W2, and I'm pretty sure there are resources the government has to get your W2. The government wants to know about shit like this so that they can go after shady defrauding employers. Out of curiosity what kind of business, and is your boss just a really old school sole proprietor without much admin support?
The I-9 is for worker eligibility status. It doesn’t affect your taxes, outside of establishing that you are eligible to work in the US. I get it that people don’t like to jump to conclusions, but the writing is on the wall here. As a 25 year entrepreneur, everything you’re describing terrifies the shit out of me. Your boss may not be screwing you, but the chances are very, very slim considering the way he’s paying you and the delay in getting you your W2.
>I-9 An I-9 is also mandatory for the employer to complete no later than the 3rd day of employment. If they're not doing I-9s, it's quite possibly because they intend to pay under the table (even if they tell the employees they're paying taxes).
This is a great point. OP needs to get some proof that these taxes were actually being paid to the govt. W2 time should be fun.
W2 time is now! OP should get it no later than Monday for 2021 (he mentioned starting work last September).
The good thing it’s January as it is time for you to receive your W2. You should ask to receive that immediately for confirmation.
> Your boss MAY be dicking you over, but employer aren't REQUIRED to use a 3rd party payroll provider. It's refreshing to revisit this thread the next day and see this is now the top comment. As OP provided more details, the actual scenario seems radically different, and less nefarious, from their initial presentation. I'm inclined to think OP's employer is a small-business owner, completely new to this, and definitely trying. Falling a little short? Yeah, but it seems like just paying OP under the table would be easier if the employer was trying to avoid the extra effort.
>What they are required to do is remit the withholdings to the revenue agencies. And, in every state I'm familiar with, provide pay stubs.
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But the vehicle of sharing that paystub isn't uniform. The employer is showing him screenshots of the calc of withholdings that is supposed to be remitted. For all intents and purposes those can be his paystubs. There's no reason to jump to any conclusions about what this employer is doing without all the facts. Just because something is unusual, doesn't make it wrong.
That is super sketchy. I'm also guessing that you won't be getting a W2 this month?
He stated he filed an extension for March 1st.
You do get one extension, so at least that isn't a lie. But absolutely prepare to not have an accurate W4, and honestly to report him to your state or the federal board of labor if it does not match up.
When would be a smart time to contact an attorney if the extension is accurate? I’m only waiting on his at the moment
https://www.irs.gov/taxtopics/tc154 > If your Form W-2 isn't available to you by January 31, 2022, or if your information is incorrect on these forms, contact your employer/payer. If you still haven't received the missing or corrected form by the end of February, you may call the IRS at 800-829-1040 for assistance. When you call, please have the following information available: > Your name, address (including ZIP code), phone number, taxpayer identification number, and dates of employment, > Your employer/payer's name, address (including ZIP code), and phone number, > If known, your employer/payer's identification number. > The IRS will contact the employer/payer for you and request the missing or corrected form. The IRS will also send you a Form 4852, Substitute for Form W-2, along with a letter containing instructions for you. > If you don't receive the missing or corrected form in sufficient time to file your tax return, you may use Form 4852 to complete your return. Estimate your wages or the payments made to you and any taxes withheld and report them on Form 4852.
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You shouldn't need to hire an attorney - contact the Dept of Labor and the IRS.
You could now, as I'm not sure if it is/is not legal to be paid this way (who knows, if he actually is withholding maybe it is?), but it's never a bad idea.
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This is accurate. Boss seems to be inefficient or inexperienced but is attempting to document right things and if consistent can absolutely just be the limits of a first time entrepreneur. If happy with job, be patient.
Yes. I had a boss like this years ago. Amazingly, he got it all right.
Thank you for your help I’ll reach out
The extension for filing W-2s is not automatic. It is only granted under specific circumstances. See line 7 [here](https://www.irs.gov/pub/irs-pdf/f8809.pdf). Unless this is his first year as a business, I doubt he will qualify.
Company has been around for years.. first year he’s been running it that I’m aware of but it wasn’t started back up until this last year
He has told the 31st to get you the form individuals and businesses have different filing deadlines but that form had to go out by this week
Nooo - as an employer you don’t get an extension on providing your employees W-2s… He should also provide a paystub showing how the withholding is broken out.
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The only shocking thing here, is that Texas is not on the list
Probably because texas doesnt have an income tax.
You can get a 30 day extension (until Mar 1 this year) in specific circumstances which he may feel he meets (first year in business). It must be filed on paper, can't be filed online.
That has zero to do with sending your W2 by the end of January. Start looking for another job ASAP
More and more it sounds like he is having money problems and not dealing with it in a not responsible way. If I was you I would start looking for another job. It does not look like he is screwing you, but he is screwing himself. Things are unstable.
FYI, my wife had a job once, small family business, she was sometimes paid cash, sometimes check, but always with a stub that showed taxes withheld etc. And then she got a W2. I'd say this at least warrants a question to the owner.
Many many questions and requests have all rendered useless. Unfortunately turned here before I start to go any further. I have never had an issue with another company showing me pay stubs and where my money is going
has anyone worked there since last year that you could confirm with? I will say payroll software can feel expensive & it’s not fully necessary
Unfortunately not. He started his fathers company up again and we’ve been running through that name. I don’t know the backstory fully
So this is his first year in business? The extension form for W-2 filing allows for an extension in the first year of business. Honestly (as an employer myself) I think it's 50/50 whether he's screwing you or just inexperienced and put off dealing with the filings. Have you been working all year?
First year he personally has been running it. It’s been a company for a long time but it wasn’t in operation that I’m aware of
All the other time it has been running there has got to be someone who knows how to... and things suddenly going wrong under him sounds like a red flag
Depends on how long business was suspended.
From what I understand it had been at least 2 years. I dont know much of his past and wish I could answer
Either way the boss needs to figure out how to do things right. Inexperience can explain why something happens, it doesn't excuse it.
well good luck to you! I’m sure everyone else has better advice, I can only say that it’s not guaranteed one way or the other :/
Do you get a paystub? Are they paying your social security taxes? Medicare?
I filed a w4 upon employment. No pay stubs since September 27, 2021 even after asking 2 months ago
Had you been working before Sept 27? Is it just the 4th quarter pay stubs lacking?
I’ve been working for this guy since September 27, beforehand he was my foreman at a previous company and I followed him out the door to this place which he owns (maybe his dad owns still I have zero clue). He’s the only one I deal with or see
I would bet he wants to do the right thing but hasn't set it up yet. He didn't have to remit taxes until after the 4th quarter last year. It sounds like he may be having trouble paperwork-wise - restarting an old business, registering with state/fed/local tax and unemployment agencies, etc., and if you are the only employee he probably doesn't want to pay for 3rd party administration. How is business? Does he seem upright in deal-making, etc.? The paperwork is NOT the fun or money-making part, and he may have put it off - not a wise thing to do, but certainly tempting.
Social security and Medicare aren’t benefits.
Many states require paystubs to be provided, just FYI.
Mine being one of them
Make an account at www.ssa.gov and see if your earnings are reported accurately. That will be a good sign if your boss is doing things legit on the backend.
Records show I have just over 4,000 dollars in taxed income for 2021. I made that the first month I was there. Thank you very much for that suggestion
Enter all of you information into this [paycheck calculator](https://www.paycheckcity.com/calculator/salary). Make sure to include hourly rate, number of hours per pay period, the amount of tax you elect to withhold based on the W4 you filled out, state for tax withholding purposes, and any deductions you have from your check. If the net pay doesn’t match then there is definitely something up. If the net does match then it’s still possible he is stealing, but this could give you a little more info.
Hanlon's razor: Never attribute to malice that which is adequately explained by stupidity. It's entirely possible that he's just a bad businessman. A few points I've read in this post I'll touch on based on my research. 1. He does not get an extension on when to provide you with a W-2. He is required by law to at least have it in the mail by Jan 31st. If you haven't received it by mid feburary, you need to contact the IRS. 2. A small bit of googling led me to believe that Missouri has laws that require him to provide you with a pay stub. Contact the state labor relations board to confirmation. 3. It's critical that you get either your paystub or w-2 asap. The reason why is because even if you don't have your w-2, taxes must still be filed by Apr 15th. You have options for an automatic 6 month extension but you're still required to pay any taxes due on Apr 15th but if you don't know what he's withheld, you don't know what you owe. 4. You can file your return without your w2 but things get a little more complicated at that point and you might want to seek an accountant if you have issues dealing with this. 5. Depending on how many people working for him, there may be a requirement to provide health insurance? did he do this? if not, and you didn't have it throughout the year, you may charged a fee (from the state, not federal). 6. A rule that I read one time about tax withholding is 25% of gross should go to taxes (Fed/FICA/SALT). Maybe that can apply here to see if he's pocketing your money under the guise of "taxes". Take the amount/hr you're supposed to be paid and subtract 25% from that. If you've received substantially less than that number, then chances are you're being screwed. 7. One final reason why it's absolutely critical you get access to your pay stub. It shows how many hours you worked and what the wage is. Without this, all you really have is your word vs his on how much you are supposed to be getting paid. Good luck. I suspect at the end of all this, you'll end up making 2 calls. One to the state labor board and the other to the IRS as it sounds like he is just trying to skirt around his requirements and if so, you could be the one left holding the bag so to speak.
Ask him for a pay stub because you want to … buy a house or refinance or …. just invent a reason. If he cant send one, bill him, raise your salary and pay your own deductions. You’re 100% getting hosed.
Believe it or not the first time I asked for them a month and a half ago-ish I needed them because I had a chance to buy a house. He continued to tell me to use my bank statements as proof of income.. lol. Needless to say I don’t have that house
You’re definitely getting screwed. I’m sorry that’s the case. You should be getting stubs and not losing houses. What else will the job cost you?
Hopefully nothing more than a headache at the end of all of it
You’re definitely getting screwed. Your boss is paying you under the table and pretending to withhold.
>You’re definitely getting screwed. Nothing "definite" about it. Possible? Yes. More likely than most, also yes. Definite? Absolutely not. Based on the information OP has provided, there's no evidence that OP's boss is "paying \[OP\] under the table and pretending to withhold". What information we have *does* fit that scenario. It, however, also fits a scenario in which the boss is withholding and reporting to the IRS, and there's nothing sketchy other than the boss' organization skills.
How do I handle filing if he is bending me over backwards?
You find a new job if he doesn't start paying you correctly, immediately. Or you're getting the total after taxes, then you'll have to pay taxes on it again
He is dead set that he doesn’t have to provide me pay stubs and that everything is in his checkbook so I think I have my answer
Check your state's department of labor, some states require paystubs with specific information and there could be penalties due to you as a result. Granted, if you pursue this path it's best to assume you no longer have a job there.
Correct. I do live in an access state
See my other reply, I'm not sure you'd have a claim since you are being provided with deduction information.
Even if doesn’t show name or gross and net ytd?
See what the requirements are for your state, but YTD isn't even a requirement in CA which has some pretty strict guidelines for paystubs.
State law may require he provide you a paystub but I certainly wouldn’t wait to find out
Absolutely. I do live in an access state as well
How would the IRS know you were making money if he didn't properly withhold taxes and report it?
When you say definitely you should understand the definition of the word. You are "likely" getting screwed would be a more apt description, there is a chance this person just doesn't do bookkeeping well. Finding out which one is happening would be better before burning a bridge.
Ok. Wait until March to see if you are going to get your W2. If you DO get your W2, then file taxes and see if the IRS complains, if not then I guess you are ok? Just make sure that you are having proper withholdings, you won't know this until you get your W2 I guess. If you do not get the W2, ask him if he filed with the IRS, you can also call the IRS and ask them what to do if you do not get your W2, I have not had this happen so don't quite know what to tell you. If they don't have any witholding you can actually file with the IRS and get your witholding back from them and they will bill him for it. Look for form SS-8 and fill that out, its not too bad. Construction businesses are some of the more shady businesses anyone can swing a hammer, but not everyone understands business and taxes. Your best bet is to wait until March and see if you get that W2. No need to overreact until then.
It’s January. Your employer must give you a W2 by the end of the month that shows your gross pay, all the taxes you paid (eg that your employer deducted and paid on your behalf) to the feds and state for 2021. If that happens the process they use is likely legit if unorthodox, but be sure to add up all the numbers and make sure it comes out to what you received. If they give you a 1099, then they are classifying you as an independent contractor and they stole those supposed taxes. if they give you nothing then they didn’t report anything to the IRS and it’s even more illegal. Both those scenarios are wage theft and you should report them to the US and MO departments of labor. Nonetheless you still owe taxes on the amount you actually received so file tax returns and pay the taxes while you pursue the back wages that were stolen. You should ask now when will I get my W2 for 2021 since it’s nearly the end of Jan.?
Have brought up numerous of these points on here to him yesterday at the end of the day and needless to say, he will not be giving me a w-2 by January 31st. Not sure how true the extension part of it is but March 1st is when he told me. After telling me if I didn’t like it I could come run the business myself or calm the fuck down
Seems very shady. I am guessing that he is keeping what he is "withholding". Or at least a portion of it. Did you get a W2 for 2021 yet? Does that seem to match what you really earned and what was withheld or are those numbers also short?
You're **not** being screwed. Your employer may be screwing himself if he doesn't get his act together. The point of a paystub is to assure you that your gross and net pay are accurate. * Since you see the screenshots, you have the gross pay information and can confirm it's correct. * If net pay isn't correct, you may owe taxes or the government (federal and state) may owe you a refund. In the event that your employer isn't paying withholding taxes, that's on him, not on you. When you file your taxes, there are provisions for "never got my W-2." You can use these provisions to file timely.
Yes, 100%. So, so many comments here giving OP bad information, leading them to believe they will owe taxes on the full amount, that they are effectively 1099 workers, etc.
https://www.irs.gov/newsroom/irs-can-help-taxpayers-get-form-w-2-0
What state are you in? Although they can give you a check like the one that you described there are regulations on the information that they have to provide for you when you get paid. It doesn’t seem like that is getting done so I would recommend talking to the labor department then a lawyer.
I’m in Missouri which if I’m correct is an access state
I've had this same thing happen. The business owner had money troubles and was "deducting for taxes" but then never filed taxes. When tax time rolled around and I didn't get any paperwork (I had quit by then) I reported this to the IRS. Unfortunately the business owner didn't get jammed up because he just ignored the IRS. His former business partner ended up having to pay because he is a responsible guy. I felt bad.
I believe you will have the answer shortly. Your employer will need to provide documents so that you can pay taxes and that should include all the withholding information.
HR chiming in. You have a right to receive pay stubs. Also, create an account in the Social Security website, to verify if Medicare and SS payments are being made and credited to your account.
A couple of decades ago I got a job doing the books for a small company with 8 employees. By the 3rd day there I realized he had been taking out Social Security, FICO, federal and state income taxes from his employees and was sending in none of it. I spent the next day gathering evidence and at the end of the day I quit. Because of the evidence I gathered, I was granted unemployment despite quitting because his actions amounted to fraud etc. etc. You could end up owing taxes because he collected them and didn't pay them, so yes you are being screwed. But more likely than not, is not reporting your income at all, which screws you out of Social Security earnings. Any way you look at it you're getting screwed, get out as soon as you can. Gather evidence, if you can, it will bolster your case if you have to file for unemployment.
OP, please report that you have not received your w-2 on Jan 31 to IRS. Apparently IRS does not grant extensions for filing w-2 deadline except in very specific circumstances.... there is a high likelihood your boss is lying and he has not paid any payroll taxes...... https://www.irs.gov/newsroom/irs-to-employers-remember-february-1-2021-deadline-for-form-w-2-other-wage-statements
This is not legal advice. If he is saying that he’s paying you after taxes, meaning that he is paying you a smaller amount than you would get if you elected not to withhold taxes, and he’s not actually withholding anything, you could potentially also have a claim for withheld wages. If you end up holding the bag for your income taxes, you’re essentially being paid at lower wage than what your boss represented to you. Idk if you have a contract or work for a set hourly rate, but either way you should consider filing a complaint with the department of labor, and then getting another job.
That's correct, of he's not reporting your withholding to the IRS, your basically a 1099 employee and will be responsible for paying tax and self employment tax on all your earnings, essentially giving you a pay cut.
Photos of the checks with the "after taxes" notation would help prove that they understood that they were we. The wr may have immediately gone into file 13.
>That's correct, of he's not reporting your withholding to the IRS, your basically a 1099 employee I don't think that's correct. If OP is under the (reasonable) understanding that he's a W2 employee, and the boss tells him he's withholding taxes but in fact is pocketing them/doing something else, that's squarely on the boss--and the IRS will pursue accordingly. You don't become a 1099 employee because your employer didn't fulfill their responsibilities to the IRS.
This is not correct. OP can file a substitute W-2 with their return if they don't get a W-2. They will have to make estimates and explain how they came up with the numbers. https://www.irs.gov/pub/irs-pdf/f4852.pdf
If if you end up being a 1099 emplyee, you need to start recording ALL your expenses as a 1099 employee, all miles driven, any expenses, any home use etc... I suggest getting this information curated now while it's still fresh in your memory.
It’s pretty simple here, you’re getting screwed. No “employer” does this. Period. There are no extensions for an employer to provide a W2 after January 31. I run businesses and have had my own. Nothing works that way. If you’re here asking the question you probably already know the answer. Now it comes down to your level of risk tolerance for staying with a “company” probably not providing retirement benefits or reporting social security payments on your behalf. Let alone unemployment insurance. Good luck 🍀
Cheers. Thank you and you’re absolutely correct. Just a bit or reassurance to make sure I’m not overreacting over something he claims doesn’t matter
This sounds pretty questionable. He needs to give you a W-2 soon so you can file your taxes.
You’re about to find out! Has he sent you your W-2 forms for taxes?
Claims I’ll get it from him by March 1st
No that’s late he has to get it to you by 31st or he will receive a fine. Because with payroll nothing should’ve changed and deadlines to pay taxes on employees don’t work that way. He owed them on your behalf and for employing you last year. Business has until April. Individuals are due that form by end of January
Tell us your state, hourly wage, hours worked or total made and we can’t help figure out what is should look like. I hate it when I hear stuff like this. If people can’t do it by book don’t have employees. Good for you for questioning and being on top of it
W2 season is here… if you don’t get one from him and instead hands you a 1099, then yes he screwed you. I’d ask for your full wage back so you can pay your taxes. If he refuse, threaten to report your revenue and labor and licensing agency and follow through with that threat if he refuses to pay you what he pocketed. As a 1099 independent contractor, you’re going to have to remit the “employer”portion of taxes that they pay for their employees, which means you’ll have to pay double, the portion the employer usually pay and your own. If it was me, I’d quit if he’s been screwing you. This is shady AF.
Make sure each check has been paying into social security. Check your work credits on ssa.gov.
Keep copies of the checks that say “after tax” on them. If he isn’t dealing with taxes due to incompetence or malice, that is pretty good evidence of his fraud and your innocence in this and will be useful if you have to engage with the department of labor or the IRS. I can tell you that the DOL, in my experience, will be very helpful to you in the event that you need them to remind your employer of their responsibilities.
The check part is legal, but you should legally have access to a paystub each pay period to show where all the deductions are going.
My main worry, the rest I can swallow and wait on
My dad was real old school and for 12 years I was paid with a check exactly how the op described. It was inconvenient for sure and anytime I would have to produce proof of income somewhere it would be slightly annoying, but it wasn't the end of the world. The employer would be in a ridiculous amount of trouble if he wasn't withholding taxes from your paycheck. I mean he's using checks which have a paper trail so that alone should ease your mind a little. You should be able to figure out your weekly gross pay, take out the taxes for your state, and it should match up with the checks he is writing you. Come tax time you will get a W-2.
I don't know that there's a requirement that he gives you a paystub every check although it makes perfect sense, but there is a requirement that he tells the government how much he retained from your paycheck and forwards that money to them. I'm sure you can verify that he is actually doing it. He also needs to give you a W2 with all that information every year. What he is doing is pretty much the same as if he was doing it manually. You can use Paycheck calculator and verify the amounts, it seems to be pretty good from what I've seen about it .
he’s definitely pocketing the deductions, this is actually really common small business tax fraud
I had a boss do this once. He screwed me. When I did my taxes, I found out he never actually paid anything that he was supposedly taking from me. If you are on the books, you need a pay stub.
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People are jumping to way too many conclusions. Hand written checks are just fine. Especially in small businesses that employ very few people.
Being unable to provide any documentation showing what I have made with him is the shady part. After a month of letting him get it together
You’ll know when you get your w-2
*if*
I'm pretty sure in most locations the law requires employer to give you a detailed paystub showing all the deductions. The odds you're being screwed (or even more likely the employer is skipping out on paying taxes) is approaching 100%.
Report him to the state's comptroller. Because if he's cheating you he's also likely cheating the government. They will demand verification and documentation of him for their side, if he goes to prison he goes to prison. In short. If you think that your boss may be fucking you over and doing something illegal. Make sure that they get what they deserve.
Been gathering every piece of dirt I’ve been able to find for the past month now. He’ll get what’s coming to him that’s for sure
You don't even need to worry about gathering that. Because the comptroller will subpoena all of that from them. And the burden of proof in anything involving taxes is on the person who the inquiry is made of. You can file an anonymous report to the comptroller and if you're terminated you're protected by the EEOC. You don't even need to do the leg work of having questionable paperwork from your side.
There's a ton of red flags here. Wow!
Have you considered having a conversation? Assume good intent and ask your boss some questions. Something like, I really like working here and you’ve been an amazing boss. It’s time we had a lot bit of a difficult conversation about money and taxes. I really need to know that I can count on you to do all the withholdings correctly, and this isn’t something that I can just take your word on or anyone’s word on really. I really need to see all the numbers for the withholdings, and I need a W2. Can you please do this for me?
Have absolutely considered this conversation and have in fact brought it up, given him time to gather anything he would need, and waited all to receive nothing. He’s had plenty of chances to simply show me a paystub so I have some peace of mind. SSA.gov number reported are WAYY off but then again he doesn’t have W2s either
You need to look for a new job. I wouldn't consider that over reacting. I'd be concerned about tax implications and the KGB I mean IRS coming after both of you. What is he withholding? Is he issuing a W2 etc? Get an accountants, and a lawyers advice asap!
You’re likely being screwed and your boss isn’t paying the taxes being deducted from your earnings. Can you contact state Dept of Revenue/IRS to see if they can tell you if there’s a record of tax payment?
It'll be very telling when you get your W2 that is due to you by Monday.
You’re going to be hit with a huge tax bill on $40,560 ($1560 x 26) when you file taxes. There’s no records of you paying any taxes into the government. Sounds like he offered you pay of 52k and is subtracting what the website tells him you will net. So to the government, your pay was 40k and you’ll pay taxes on that. I’d be really surprised if he has tax documents at the end of the year for you. This is definitely fucked. Most people use that site just to budget and have a decent idea of what they’ll be bringing home after taxes. There’s probably even a disclaimer on the tool he is using that says this is an estimate.
>You’re going to be hit with a huge tax bill on $40,560 ($1560 x 26) when you file taxes Very, very unlikely. >There’s no records of you paying any taxes into the government. There are records of the boss withholding pay for tax purposes, imperfect as they are. Whether they are being forwarded to the govt. or not is the *employer's* problem, not OP's. >So to the government, your pay was 40k and you’ll pay taxes on that. This is incorrect. If OP can show how many hours they worked, what their rate per hour is, and that their pay was adjusted for withholdings (and from their comments it sounds like they have documentation to support all of this), the IRS will pursue the boss, not OP.
I wonder if he is paying into your SSI and Unemployment/Disability fund. If not you are being screwed... I also would guess he is going to have a hard time creating a W2 for you and probably has not been paying your income tax liabilities. You will be help responsible for these things if/when he skips town.