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Originally Posted by SlamDesigns
I don't understand why? I don't think I've done anything wrong. It doesn't matter where I cash my checks as long as I pay taxes on the money, does it?
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Never been audited have you .... When a self employed business owner cashes a check at a restaurant or the issuing bank for cash, rather than depositing it into his corporate account, he is setting himself up for a lifestyle audit, and future scrutiny that is a nightmare.
They will automatically think --- how many accounts does he have that he keeps a second set of books on and has no trail of income.
Example... I pay a carpenter $5,000.00 to build a deck or something. He takes my check to your restaurant or MY bank, gets it cashed for cash. Will he set aside $1,500.00 for quarterly taxes? Or pretend he never did the job.
And who would know? Even if you are honest they will see the potential for avoidance and treat you accordingly.