[Curtis Frieden]

Curtis Frieden

I have a bird dog that would like to get paid via cash instead of check or wire.

In the docs it says check or wire (I assume to keep a paper trail).

Should there be a strict no with paying in cash? Or am I misunderstanding why cash or check are listed methods?

[Hank Baltar]

Hank Baltar

You need records for your taxes, or ideally it is paid out of closing and the closing company will/may issue a 1099. Can’t say CASH hasn’t happened, however not by me. PS – You will learn to live by a paper trail after an IRS enema (I mean audit) no matter how squeaky clean you are before the IRS inquisition begins.

Hank

[Curtis Frieden]

Curtis Frieden

Thanks Hank – That’s exactly what I assumed!

[Deb Krantz]

Deb Krantz

I’ve been looking for some type of bird dog agreement. What are you using? Would you recommend?

[Jackie Lange]

Jackie Lange

As soon as you go in to business for your self, you have a partner… the IRS. They expect to know exactly where every single penny of revenue and expenses was spent and they want to see proof.

It’s none of their damn business as far as I’m concerned but there is no way to avoid it.

If you pay anyone any money, they want to know who you paid, how much and why. You have to send in proof every year and it needs to be tied to the person’s social security number. Sure you can pay under the table. But then there would be a break in the paper trail which could raise a red flag and cause YOU to be audited.

The easiest way to handle payments to your bird dog are to give them an option on the property that they will be paid $X for the referral. They that paperwork in to the title company along with the purchase contract. It will show up as a line item on the HUD-1. They title company will issue them a check or wire $ to their account.