Bonuses paid by boss

[sissy76]

What is the name of your state (only U.S. law)? TN
A former employee in our company received bonuses from her boss directly. While she was an employee of the company, her boss is in business for himself through the company, who pays a percentage of his earnings to the company. He wrote personal checks for bonuses, based on the monthly receivables. He could not claim these bonuses as business expenses on his taxes, since all expenses are ran through the company. As long as she claimed the bonuses as extra income on her taxes, was it legal to accept the bonuses?

And is the an set amount she can receive, before having to claims taxes?
This was being done and questioned something about EOE, since she was the only employee who received such bonuses. She was also the only employee of the company who worked for this boss. What is the name of your state (only U.S. law)? TN

 

[pattytx]

It was not illegal to accept the bonus. As you state, she must claim the income on her 1040 regardless of the amount. Did she get a 1099-MISC form?

What was almost certainly illegal was the employer's action of paying earnings without reporting them and taxing them as required by IRS and state laws.