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Question of Liability regarding an admitted Tax evader

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TNcowboy

Junior Member
What is the name of your state (only U.S. law)? Tennessee
Hi all,
I have a question regarding a former vendor in California for some rental properties we own. We have used his services for over 25 years and have not needed to 1099 him until 2012 due to the change in IRS regs. It was at that time that he informed us that he in fact has NEVER paid or filed taxes (state or federal)! Of course he is no longer working for us. Our accountant said that we have to withhold 29% of his invoices since he will not supply us with a SS# so a 1099 can be issued. The vendor has sent us final invoices for 2012 (yeah he is slow) I am writing him to inform him of the corrected accounting of his last invoices minus the 29% for 2012 totals. In the draft, I am informing him of IRS tax code and that he is, by his own admission, guilty of felony tax evasion. Now the question: Can I be liable as an accomplice or an abettor by putting this in writing to him and thereby admitting that I know him to be a criminal? I don''t necessarily want to turn him in; do I have a legal duty to do so?
Thanks ahead of time,
Michael
 


davew128

Senior Member
Exactly how do you possibly think you are aiding and abetting? You sent the vendor a W-9 and are remitting backup withholding upon failure to receive it back. Whether the vendor reports the income is none of your concern nor would you ever truly know one way or the other.
 

TNcowboy

Junior Member
Thanks for the quick feedback. I did not feel as though I was committing any offences, but with (how many??) pages of IRS tax code and regulations, it is never a bad idea to double check.
Thanks again,
Michael
 

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