Is Ohio State Wrestling in a recruiting funk, or is Penn State recruiting just THAT GOOD???

bdhof

Well-known member
How are they not paying taxes on that money? Are you suggesting they are risking their large salaries and their careers to make another $13K (estimated under a fictional scenario) "under the table" and then illegally not report it on their tax returns to save about $4K in taxes??

I'd like to think they are not that stupid - but you never know about how easily greed can dictate stupid decisions.

There is a big difference between tax avoidance and tax evasion. Not reporting income (tax evasion) is criminal (a federal felony) and the penalties can be severe - including prison time. Reporting expense offsets to that income that are determined to not be deductible - is tax avoidance. That is punishable by fines, penalties & interest, and restitution for all taxes not previously paid. But no criminal charges if determined to be done in error.

Definitely not worth it. All it takes is for an IRS agent to catch wind of suggestions that the "coach is training athletes with under the table cash payments" - and it is in the thousands of dollars over a long period of time. That, and a vendetta for the coach or school, can easily trigger an audit.

As a final point, whistleblowers can receive up to 30% of the taxes and penalties recovered by providing such information to the IRS. Pi$$ off the wrong parent that has seen what is going on and heard the coach mention he will only take cash because he "doesn't have to claim it on his taxes" - and there you go.
I agree with you that this would not be the ethical way to conduct a business. However the USA is filled with cash payments to home repair guys, cleaning service, private day care, bookies, etc, etc, etc. The IRS doesn’t have enough people or interest in chasing all these guys and gals down. Some will get busted - probably more high profile vendors.

It’s always a clue when they offer a discount for cash payments.
 

OCEagle

Well-known member
I agree with you that this would not be the ethical way to conduct a business. However the USA is filled with cash payments to home repair guys, cleaning service, private day care, bookies, etc, etc, etc. The IRS doesn’t have enough people or interest in chasing all these guys and gals down. Some will get busted - probably more high profile vendors.

It’s always a clue when they offer a discount for cash payments.

Yep - they will go after a high profile guy like a highly paid coach in order to set an example and get it in the news as a deterrent. No one thinks they will get caught for this - until they do. If you do get caught, expect to be audited frequently - even though you may not even know the audits are taking place through various automated exception reviews that looks for income and expenses that are out of the ordinary from past filings. Got such a letter when I missed a quarterly dividend payment on an investment. Those are easier to find because of the 1099 info sent in. I admitted to the error, and they just closed it rather than pursue a piddly amount of tax owed. Luckily, I have never received another audit notice since that one about 25 years ago. That is rare.
 
I can't remember the exact numbers, but I tried to figure out how much Jordan's camps were bringing in each summer. How many teams/kids times 3 facilities times how many weeks. I remember it being several hundred thousand dollars before overhead. Not to mention all the merchandise he sells. Private sector is definitely the way to go. I imagine Spatola is doing pretty well with that route just in Cincy.
 
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