Illegals working under the wrong social

[Bjorn]

Illegals

Since the law says they must file if they have income and I work for them. I guess I'll mark the w2 non standard and efile the tax return under the ITIN. The ironic part of this is som get refunds due to the refundable child tax return. This will fuel the fire of are they paying taxes. I did not make the problem and I'm sure it will not be fixed any time soon.

[taxea]

Jainen...I understand the client confidentially issue...but this would not be a client of mine.
And when my clients don't have a state license where required, I tell them to get one. In my state a Sch C cannot be filed without one. taxea

[OldJack]

BeesKnees
My point exactly...wouldn't we becoming involved in the illegal activity by filing the return when the ITIN should make it obvious that the SSN is fake. Don't we have an obligation professionally and morally to report the possible illegal activity?

Since I am not required to prepare a tax return for someone that has performed an illegal act (fake documents, illegal in this country, etc) I would tell them to get someone else. I agree that preparing an incorrect tax return borders on involvement. I am not required to report them but nothing would keep me from it if I wanted too. I would not bother to report them to government as it is clear at this time that the government doesn't want to know. And, their problem is not my problem just as the IRS would probably tell you its not their problem as it is an immigration department issue.

[veritas]

I would not do a tax return for this individual period. I mean why don't you register them to vote to while your at it.

[S T]

Calif

I do have a slight problem with illegals. We offer payroll service for some of our business clients, and have found several employees working under a "fraud" social security number. We give the employee the opportunity to correct and if not then the employer has to terminate them . Almost always the employee terminates.

It really is too bad, as some of these employees have been really good employees, but the employer can not risk employing an "illegal". There are penalties for hiring illegals even tho in the past it has been rarely enforced, actually mostly overlooked.

As a payroll servicing agent for small employers don't we have an obligation to advise of the potential fines and penalties of employing illegals?

Sandy

[jainen]

Of course you have

Of course you have an obligation to tell your client what the potential problems are. Those problems are different depending on whether your client is the employee or the business. In either case, you have no obligation to report a potential problem to the government.

[Jim R]

E-File rules

Quoting an IRS broadcast e-mail dated 2/20/2004

"If a client presents an ITIN and a Form W-2 showing an SSN, the tax return must be filed on paper. E-file rules do not permit an Electronic Return Originator (ERO) to alter information on a wage document, and mismatched taxpayer identification numbers will cause an e-filed return to reject."