Taxes/Business
My employer stopped paying my taxes halfway through the year and didn't inform me. I received a check for the same amount as if he were still paying those taxes. Now my W-2 form shows an income of half of my actual income. He explained this by saying that he intended to pay the back taxes at the end of the year but by then it was too late. He then told me to just file the W-2 and I'll get more money back because it say's I made so little. I refused and told him that this was not an option and this needs to be take care of correctly and legally. He has since made out a 1099 form for me and written a check far short of the actual taxes that I now owe. Is this legal? What can I do to correct this if he refuses to pay me the correct amount of taxes that I now owe? Secondly he has failed to pay the sales staff their commissions. One salesmen is owed over $11,000.00.
He has clamed that the company is broke but all of his personal bills,( home, home utilities, drum sets, home improvements, entertainment ect. have been paid with company checks. Is this legal and what can be done about this?
Thank you,
1 Answer from Attorneys
Re: Taxes/Business
It sounds like your boss has a dilemma and unfortunately, so do you.
At this point, it seems you have 2 tax documents that will be reported to the IRS: your W-2 and the 1099.
In order to keep your account in good stead with the IRS and the IL Department of Revenue, you need to file your return based on these documents.
Now here's the upside: since you were paid 1099 income for part of the year, you are considered an independent contractor and may be able to deduct some of your expenses related to your employment. These deductions could include mileage, supplies, telephone, etc.
I would seek the advice of a qualified tax preparer for how you can pay the least amount of tax. Let me know if I can assist.
As for your employer, you have to decide whether you want to be a whistleblower on his practices, or whether you want to leave it alone. You might want to start looking for another job.
Good luck to you.
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