how can immigrants file taxes if the are paid in cash?

Question

i know some parents that are illegal immigrants who have children in school and are paid in cash. im not sure why theyre paid in cash, maybe because they dont have an id or something, but anyway how will they be able to file taxes if they have no proof of income. also for those who are trying to fill the fafsa, what can they do if their parents are paid in cash. should they put "will not file taxes" what exactly would this do to the ppl applying for the fafsa?

Answer 1

WELL FIRST THEY WOULD HAVE TO DO A SCH C (SELF -EMPLOYED INCOME) AND APPLY FOR ITINS (INDIVIDUAL TAXPAYER IDENTIFICATION NUMBER) IN THEIR INCOME TAX. THE FACT THAT THEY ARE PAID CASH DOES NOT MEAN THEY CANNOT REPORT THEIR INCOME TAX. IF THEY WANT TO BE LEGAL SOMEDAY THEY NEED PROOF THAT THEY ARE REPORTING THEIR INCOME TAX AND OF COURSE PAYING TAXES. ALSO BY OBTAINING THEIR ITIN THEY CAN FILE THEIR RETURN TIMELY EACH YEAR AND HERE IN TEXAS THE ITIN ALSO HELPS THEM GET A HOUSE, CARS CELL PHONES AND EVEN BANK ACCOUNTS.

Answer 2

This is an issue that knots a lot of people’s panties in knots.

Most illegal aliens are resident aliens. For tax law resident aliens are treated exactly as US citizens are for tax law purposes. Since illegal aliens can’t legally get a job, then the only lawful work they can do is self employment.

A net income from self employment of over $400 means they are required to file a tax return; so they can pay social security taxes which they won’t qualify for at retirement by the way. All income not specifically exempt by law is taxable; including self employment and illegal income (remember Al Capone?).

If an illegal alien wants to file and pay his taxes the IRS has a special number called an ITIN (individual taxpayer ID number) that the illegal can apply for when they file their tax return. IRS will not turn them in to immigration or homeland security nor will they turn you in to the police if you report illegal income on you tax return because it violates the disclosure laws. Some people get mad about that but IRS main purpose is to generate income for the United States and they have done studies that show it would cost more than it would generate. Catching illegal’s is immigrations job.

I have no idea how it affects FASFA, but if its anything like tax law they don’t qualify

Answer 3

The employer is required to file a W-2 whether the payment was cash or check. If they do not, there is procedure to ask for it, and if that fails, then there is a form for the employer to write down the amount that they remember being paid so that they can file without proof.

If the children are illegal, they will not get anything from the FAFSA. If the children were born in the U.S., they are citizens and are eligible for financial aid.

Answer 4

They are paid in cash because they are illegally in the country. They have no ID including no Social Security numbers. The employer is also behaving illegally, probably underpaying these people, and not paying unemployment insurance, workers' compensation insurance or Social Security taxes for these people among other things. The students will have to speak with the financial aid people and ask their advice. I'm sure most of them have heard stories like this before.

Answer 5

Self employed individuals pay taxes all time, even when their receipts are entirely in cash. If a taxpayer is receiving payments in cash, they should be reported on schedule C of their 1040 tax return. The individual then is subject to income tax, employer portion of FICA taxes, and the employee portion of FICA taxes. An employed individual receiving a W-2 does not have to pay the employer portion of FICA (nor does he/she receive the deduction for payment).

Every company from the paid in cash housekeeper to billion $ corporations has the responsibility for adequate record keeping that is proof of income. Not receiving a 1099 or other form is not an adequate excuse for omitting income.

Answer 6

If they are being paid in cash it is most likely because they are working off the books as a result of the fact that they are in this country illegally and don't have proper identification and/or a Social Security number. If they don't have a SSN you better believe they aren't paying taxes either!!

Answer 7

Sounds like they are working illegally. They could still file a tax return, showing the income on a schedule C - they don't have to have proof that they received it.

As to the FAFSA forms - too bad. Families who cheat the government by not paying tax on their earnings aren't eligible for some of the government benefits they might get if they did things legally.

Answer 8

This is rich. These illegals want to get free education, financial aid, and not pay taxes. Not like the hard working tax paying immigrants we are always being told almost all are by the liberal media.

All income must be reported, even illegal income! The IRS will assign a taxpayer ID number for purposes of paying taxes, even if there is no soc. sec. number or eligibility for the same.