abctax55
Level 15
12-06-2019
04:54 PM
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Audit risk if salon only claims 1099K, has never claimed cash, and is determining if cash should be claimed
Client's salon has never claimed cash. She has only claimed income from the credit card income derived from 1099K. She is thinking about claiming cash for 2017. However, if she does that, will that create an audit risk? Or, would it have less audit risk if she just claimed 1099K amount as income because that is what she has done for all of these years?
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Audit roulette is not allowed in determining what to claim on a return... and when is cash received for services ever NOT reported ?!?!
I'd be more concerned with tax evasion, fraud, losing my license to practice, going to jail, etc than the "audit" potential.
Any client asking this question in my office would be shown the door.
HumanKind... Be Both
