Quote:
Originally Posted by Camron Rust
First off...neither one is likely to be getting a W-2 for their officiating work. A 1099 is far more likely and only if they get more than $600 from any one source. Joe could even still comply with IRS laws by paying the taxes on the income he really received even if it was not properly attributed to him. He may have violated some IRS regulation here but the IRS mostly cares about whether they got the money or not. If he paid, they're not likely to do much to him if they ever found out.
Secondly, someone could be doing this now. However, unless Joe Smith knows John Doe's SSN, this will get flagged pretty quickly when the organization files their 1099's with the IRS when the provided SSN doesn't match the name that is submitted with it. They might get away with it for one year until the taxes are submitted but that's it. Assuming Joe Smith does know John Doe's SSN, John Doe might face a little grief when the IRS comes looking into why he didn't claim income that an organization said they paid him. But once he proves it wasn't him that received the income, he'll be fine.
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This all assumes that an official gets at least $600 from one source. Now, I didn't have a single school pay me $600 last year, but I still got a 1099 from refpay since several schools use it to pay.
The requirement to use refpay puts a bit of a crimp in the plan if someone wants to create a fake identity to officiate; but I'm sure it could be worked around by an ambitiously twisted individual.