I had accepted a job position about a month or two ago, and I didn’t like it so I left after only working 2 days and one half day. The office manager had emailed me when I quit that they would send me a check for my time, but I told her don’t worry about it. Well, I just saw the check today in the mail, and it did not take out any taxes. I had filled out a w-4 as I recall, but this check is a personal paycheck from the firm. I don’t want to deal with paying taxes later on for this paycheck, so I’m wondering if I should just mail the paycheck back to them?
Keep the money - you earned it, even though you didn’t stick with the job. Maybe put it in a savings account so that when it comes time to pay taxes, you’ll have the money handy.
Request a proper pay check with appropriate deductions. They should process through payroll and pay their portion of employment taxes.
If you don’t want the money for some reason, donate it to the Church.
Ive had the same thing happen with a couple jobs in my past, where I didnt even work a full week, this was over 8 years ago, but I remember come pay day, they told me to just come in and gave me cash instead of a real paycheck, it wasnt much, I believe one was $80 something, and the other around $200.
Im not sure, but I think in order for paychecks and deductions to sort of kick in, you have to at least complete a full week, since most jobs hold a week back anyway, if someone quits before they complete the first week, I doubt payroll would bother, its easier to just pay you cash or cut a basic check with no deductions.
Of course, if its over $500, you would be responsible for reporting the income at tax time, anything less than $500. has no requirement to report.
This is not correct. It does not matter if they work one hour, one day, or one week, payroll must process the paycheck including proper deductions. whether they give a check or cash, they must pay their portion of self employment taxes, FICA, etc.
what they are doing is not legal.
If they process properly, they’ll report everything to the taxing authorities, whether or not they withhold taxes from your particular check. Which means there will be a record of you having been paid, which means you will owe your share of the taxes whether you deposit the check or throw it away.
Oh my…This is bad advice for two reasons…one it doesn’t address the OP’s concern, which was not the employer’s responsibility for paying the employer share of the tax, but the employee’s responsibility and whether the employer is mandated to withhold taxes.
The employer responsibility to withhold from the employee cannot be determined by the information presented in the OPs posting. It is dependent on pay status (Hourly, Salary, etc.), filing status (Married, Single, Married filing Single, Married Filing Joint), and how much was earned.
And, whether using the Wage Bracket or the Percentage Method in determining employee withholding, there is a minimum amount that must be earned before the employer is mandated to withhold.
Regardless if there is a mandate, if the employer does not withhold, the burden of responsibility for personal tax liability still lies with the employee, or even if the employer withholds too little, he will be responsible for making up the difference for what the employer owed the IRS, and may be fined, but the employee is still responsible for their share.
Actually, the OP didn’t want the to pay her at all. Which is also not legal.
But since she was paid, she should be paid properly through payroll and not some cash-in-a-bag method.
“Could have”, “should have”, and" would have" are not concerns of the tax code.
The fact remains that she received what must be carefully scrutinized to determine if it is taxable taxable income.
Whether paid through what you subjectively call “proper” payroll, or is paid in cash, or even paid in goods and services, the only thing she needs to be clear of is that she is
obligated; morally, ethically, and legally, to pay any taxes she owes on what is classified taxable income.
It seems to me that she can just report this on her tax form as earned income, and the taxes due will be determined by how much she earns this year overall. It was only two days so it won’t add much to her income, and any taxes due can just come out of whatever her next job takes out.
Its all insanely complicated and hit or miss anyway, IMO. I was surprised I came within $200 of what I owed last year.
Does that apply in every state, or do you know if its a recent thing?
I have been paid a few times in cash, but it was awhile back, (10+yrs ago), it was always from jobs I did not work a full week at though. One was a large nationwide pizza chain (they paid me with cash out of the register, around $80-100.), another was a distribution center type job…(they did cut me a check, but it was a basic check, not a payroll check, no deductions, it was around $200 if I remember correctly).
Yes, it’s the IRS, mostly. It all has to be reported (I think) and then the decision as to whether or not it meets a minimum requirement is sorted out later.
If I recall correctly though, OP might be in Canada
The administrative time and cost of putting someone in their system, I-9, e-verify, state and federal tax forms, etc only to process a check for a day or two and then process them out again is a pain.
They were probably hoping to avoid the aggravation by cheating a bit.
Donate it to a good cause.
Bank the cheque, declare it for tax purposes, and pay your tax at tax time. What’s the big deal?
You want to give up 2.5 days pay because it is a hastle to pay the tax out of it?
Or as others have noted, donate it to charity and then you don’t have to pay the tax on it. And a worthy charity will have that money rather than this company who you wanted to leave after such a short time.
I just looked this up. If I have a household employee (as opposed to a contractor) that I have paid over $2000 to in a calendar year, I am obligated to start withholding and paying Social Security. I’m sure the same rule would apply to a business who hires employees.
Since you earned so little, apparently your employer was not obligated to withhold Social Security or income tax. The employer is probably not even obligated to send you a W-2 for the amount you earned, but they might send you one anyway.
The amount of income tax you would owe on that amount is so small that it is not worth losing sleep over.
Since you showed up for work, you needed to be paid. It would have been illegal for your employer to not pay you.
Maybe this is a company that does not do witholdings?
I worked for three years for an enormous Ivy League university and they never witheld taxes. We had to arrange payment of quarterly taxes ourselves.
If your overall income (from all jobs that you had) for the year reached a certain amount, then you would have to file taxes and add that paycheck for the 2.5 days to your total income when filing taxes. I don’t know what that amount is exactly, but you can go to this website irs.gov/Filing (if you are in the U.S.) and click on “Do I need to file a return” under the heading “get ready.”
Yeah, I run a company and employ W-2 and 1099 employees based on their preference, and my flexibility to better compete with competitors. 1099s are less headache, become with greater restrictions.
As a 1099 consultant/contractor, you deduct your own taxes and pay them quarterly (Form 941). It’s a sweet deal if you don’t need benefits.