Business won't accept cashiers check only cash for major payment

[SkyMaster]

What is the name of your state? NV

We are trying to pay for repairs to our truck. The mechanic wouldn't accept our check. We offered cashiers check. He says he will only accept cash.

We are talking a few thousand dollars. There is no way we are paying that much in cash. Not to mention the lack of being able to say we paid our bill.

What can we do?

 

[quincy]

What is the name of your state? NV

We are trying to pay for repairs to our truck. The mechanic wouldn't accept our check. We offered cashiers check. He says he will only accept cash.

We are talking a few thousand dollars. There is no way we are paying that much in cash. Not to mention the lack of being able to say we paid our bill.

What can we do?

You would, of course, get a receipt for your payment, regardless of how you paid, correct?

You probably should have added this question to your other thread.
https://forum.freeadvice.com/threads/mechanic-has-our-truck-for-12-months.663323/

 

[adjusterjack]

He says he will only accept cash.

So he doesn't have to report it as income.

What can we do?

Bring him a cashier's check. Have somebody make a video. Tell him if he doesn't take the cashier's check you'll pay him in cash and send the video to the IRS and the state tax office.

 

[quincy]

The mechanic accepted a $3000 check from you once already. Was there a problem with that check? Did the mechanic explain why he wants only cash now?

Before you pay (however you decide to pay) I recommend you ask for an itemized receipt detailing the parts and labor costs. It could be smart to take another mechanic with you to check out the work done on the truck.

If you do record your visit, get the mechanic’s permission to record your visit in advance of recording.

 

[adjusterjack]

If you do record your visit, get the mechanic’s permission to record your visit in advance of recording.

Not necessary. Nevada is a one party consent state. Just bring out the cell phone, point and record overtly.

 

[quincy]

Not necessary. Nevada is a one party consent state. Just bring out the cell phone, point and record overtly.

Ahh. You’re right. For some reason I was thinking California instead of Nevada.

 

[Taxing Matters]

So he doesn't have to report it as income.

Not so fast there. There a number of reasons a particular business might have for dealing only in cash that are legitimate and the business accurately reports the cash as part of gross income. One of the most important is cost. It costs businesses more to take credit cards, debit cards, checks, etc. Then there are businesses that for good economic reasons will only take cash if you pay the exact amount owed (thus relieving the business from having to make change) only take debit or credit cards; no checks and no cash. That's a convenice for the business.

No law requires that a business take any particular form of payment. However, in contract law if the contract is silent on the form of payment then generally any widely accepted form of payment tendered by the customer would satisfy the customer's contract obligations. But the customer doesn't want to have to pay the cost and time needed to litigate it if the two parties butt heads on the issue. For that reason, in any contract in which you will be making payment, verify before entering into the contract what forms of payment will be acceptable. The one very clear rule is that unless the contract specifies otherwise, cash is always good tender. Indeed, it says that right on our paper money. Note that being good tender is not the same as saying the business must take the cash. Tender is a term of art in the law where one party offers the payment required in the contract as satisfaction of the contract. The failure of the other party to accept the tender may result in the party refusing the tender to be in breach of the contract. In other words, refusing to take the offered cash becomes a contract issue, not a criminal law issue.

Bring him a cashier's check. Have somebody make a video. Tell him if he doesn't take the cashier's check you'll pay him in cash and send the video to the IRS and the state tax office.

The tax agencies are not likely to do anything with that as the video does not show a crime because it's legal to take cash as payment. It's the failure to report the income that would be the crime. One video of a single transaction in most cases is not engough to provide what the IRS would need to confirm tax crimes. It's likely that when the tax agency questions him about the cash received shown in the video that the business owner will say it's included in the gross income. Since cash is fungible he may indeed be telling the truth and it was some other payments he failed to report. For the IRS to prove that isn't the case requires a rather in depth investigation to track the financial transactions of the business. In other words, a video of a single transaction usually won't help the agency much. If you can provide evidence of a pattern of taking cash and what those cash amounts were, that would be very helpful for the tax agencies. But doing that is a lot work.

When I worked at IRS I had a small number of people over the years that brought to me evidence of a single transaction or just a few transactions in which the taxpayer was paid in cash and the person reporting it was utterly convinced that it proved the taxpayer (usually someone they have dispute with) is taking the cash under the table or otherwise failing to report all the income. In nearly every instance there just wasn't enough in what was provided to make it useful for me to do anything with it.

On the other hand, I had secretary who got stiffed by her boss who brought in copies of complete real ledgers for the business (rather than the bogus ledgers he kept to show the tax agencies) which was like gold — matching the real ledger with the returns filed clearly showed underreporting of income. I referred that to the criminal investigation agents (the ones known as IRS special agents) and about two years later I heard from them that the taxpayer ended up taking a plea bargain on criminal tax charges, filed bankruptcy, and his wife divorced him. Part of the terms of the plea bargain was that he had to pay the unddereported tax he owed, along with interest and penalties. That made my job a little easier. My last contact with him he was quite miserable about the whole thing. The taxpayer's former secretary received a payment reward for reporting to me what he had done. She was the one that was the most satisfied with the outcome.

 

[zddoodah]

The mechanic wouldn't accept our check. We offered cashiers check. He says he will only accept cash.

We are talking a few thousand dollars. There is no way we are paying that much in cash.

Can you explain your willingness to pay with a personal or cashier's check but your reluctance to pay with cash? What possible difference does it make? If you buy a cashier's check, you will pay cash for it. If you're concerned about having evidence of payment, then get the mechanic to give you a receipt at the time of payment.

Also, no reputable mechanic will operate on a cash-only basis. Why not take your truck to a reputable mechanic?

What can we do?

Simple: If you want to do business with this particular mechanic, then you'll do it on terms to which he is agreeable. If you don't want to do business on those terms, then take your business elsewhere.

 

[Taxing Matters]

Also, no reputable mechanic will operate on a cash-only basis. Why not take your truck to a reputable mechanic?

Although I agree that today it would be highly unusual for a mechanic who is reputable to only take cash, it's not beyond the realm of possibility. It is something of red flag today though even if the business runs things properly. That's a big change from the 1980s when cash transactions were much more common than they are today. Electronic payment processing has completely changed how people pay for things since the 1980s. Back then most of my payments for things were in cash or sometimes by check. Today, I don't often use either one to pay for things. Electronic payments are so much easier and nearly every business accepts some form of electronic payment so there isn't much need for cash and checks today like there was back then. It's gotten to the point that when I open a new bank account some banks no longer ask if I want checks with that account. If I want to be able to write checks, I have to specifically ask for that.

 

[quincy]

I am curious why the mechanic accepted a check for $3000 from SkyMaster originally and is now insisting on cash. What has changed from the initial transaction to this latest payment? Seems odd to me.

 

[Zigner]

I am curious why the mechanic accepted a check for $3000 from SkyMaster originally and is now insisting on cash. What has changed from the initial transaction to this latest payment? Seems odd to me.

He can take a check for the initial payment because he'll have collateral (the truck) until the check clears. The final payment is different because he'll no longer have the collateral while waiting for the check to clear.

I suspect that there was some sort of falling out between the beginning of the job and now.

 

[quincy]

He can take a check for the initial payment because he'll have collateral (the truck) until the check clears. The final payment is different because he'll no longer have the collateral while waiting for the check to clear.

I suspect that there was some sort of falling out between the beginning of the job and now.

That makes sense.

And, yes, it seems clear that there was a “falling out” between the mechanic and SkyMaster.