Can I Get in Trouble by the IRS for Having My Tenants Give Me Rent in Cash, or a Check Made Out to Cash?

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“I have an angry tenant who is threatening to turn me into the IRS because I have a cash, or check made out to cash. policy for collecting rent. This apartment is in the basement of my home and tenants have to walk thru my mud room / laundry to get to the apartment door. The rent is $550 a month. Would the IRS take such menial case on as this?”

[NOTE: Articles and answers on DearEsq., while written and published by lawyers, do not constitute legal advice, and no attorney-client relationship is formed by your reading of this information. You should always consult with an attorney for any legal situations.]

It’s hard to say what the IRS will and won’t take on, but tax evasion is a criminal offense and underreporting income can be seen as a form of tax evasion. You want to be sure you’re reporting your rental income properly. Your best bet is to sit down with a qualified accountant and discuss your situation, and what you need to do to get your reporting in order.

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Author: House Attorney

A house attorney has answered this question.