(US, Indiana) So, my mother-in-law is retiring next month from her regular day job. She also has a side business she's being running for a year or so. She recently asked my husband if she could put that side business in his name. This is a craft-show type business that is somewhat seasonal. She has mentioned possibly traveling to out of state shows once she's retired and will have more free time. **Edit - forgot to add, my husband would have zero interaction with this business & receive no income from it. It would be an 'in-name only' situation.
I'm getting this info second-hand, but it seems she wants to do this in order to get around Social Security's income restrictions (she's retiring at 62). Once the business is in his name, she will set herself up as an employee and hire a payroll company to make sure the appropriate taxes are taken out. She is assuring my husband that the business will be set up in a way where he'll have zero personal risk of any tax liability or other issues and that the lawyer SHE hires will actually by HIS lawyer working for HIS best interests. We are also in the final months of a Chapter 13 bankruptcy - I'm assuming we would have to get our Trustee's ok to even do this. We've both worked so hard at getting back on track financially and I don't want to put that at risk.
I did some research and I'm not understanding why this is even necessary. From what I read, if she does exceed the monthly net income limit her benefits will get reduced, but that reduction is actually deferred until she reaches full retirement age so she'll end up getting the money anyway. I'm guessing one possibility is that without the full SSI & side business income, she won't have enough income for her monthly expenses - she's apparently told my husband that she has no retirement savings/401k/pension. If she's making enough net income to exceed SSI's limit, how is she going to get this extra money if she's only paying herself enough to meet the limit?
Naturally, my husband wants to help his mom out and is ok with this. I'm not so sure. I don't think she would go into this with the intention to do anything to hurt her son, but I also know stuff can go sideways when you least expect it.
I'm 99.99% leaning towards a hard 'No' on this - I think there's no way to guarantee zero risk & the whole thing (to me) seems like fraud. My husband says he won't go forward unless I'm ok with it, so I'm reaching out to see if maybe I am looking at this the wrong way?
Written By: Kalixxa
Source: http://bit.ly/2YX7fN1
No comments:
Post a Comment