What is the underground economy?
It goes by many names. The black-market, moonlighting, shadow or phantom trades, working under the table, or doing jobs for cash. The list goes on and on. Despite the many names, the concept is simple.
The underground economy exists wherever people or businesses ignore tax laws to gain an unfair advantage. By undercutting the competition and refusing to report their full income, they are breaking the law. You need to report your income from all
sources—even if you’re paid in cash or bartered services.
Have you ever worked for cash? It could be something as simple as painting a house or building a deck on the side. Have you ever decided not to offer a receipt or ring a sale into the cash register? Have you ever worked a construction site "off the books?"
If the answer is yes, then you are not only hurting yourself, but also your family and friends.
Even if you haven't reached the stage where you are considering buying a house, starting a business, or retiring, you need to think about it now. They all require a responsible track record and proof of income. Without them, you are out of luck! Working under the table can be hazardous to your career. For more information, go to Are you hurting yourself by working under the table?.