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  1. #1
    Join Date
    Aug 2019
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    Default Bank Account Under Daughter’s Name

    Hi I’m said daughter, 28 years old. My parents had me open a bank acct in my name for my father to direct deposit his check into to pay bills and groceries. However he and my mother owe back taxes. Is this illegal for me to do? They have offered a “solution” where they would just deposit cash from the check into my acct so that it can continue to be under my name. Would that be illegal as well? If any of these are, would I as the account holder have consequences for this or would it just be my parents?

  2. #2
    Join Date
    Oct 2014
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    7,345

    Default Re: Bank Account Under Daughter’s Name

    Quote Quoting Trane270691
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    Hi I’m said daughter, 28 years old. My parents had me open a bank acct in my name for my father to direct deposit his check into to pay bills and groceries. However he and my mother owe back taxes. Is this illegal for me to do? They have offered a “solution” where they would just deposit cash from the check into my acct so that it can continue to be under my name. Would that be illegal as well? If any of these are, would I as the account holder have consequences for this or would it just be my parents?
    It is not illegal for them to direct deposit the money into your account and then for you to give them the money back to pay bills. It becomes illegal, however, if you and they take steps to conceal the arrangement from the tax agency. Note that if they owe federal taxes this scheme will not put that money out the reach of the IRS. I strongly suggest you at the very least keep your own money in a different account at a different unrelated bank. Even though it is not necessarily illegal, it can still cause you problems. Personally, were I in your shoes, I'd stop letting them use accounts in your name for that reason and encourage them to work out an installment agreement or whatever other arrangements that might be workable with the tax agency. Or, if these tax obligations are substantial and more than 3 years old, bankruptcy might solve their problem. Stashing some cash in a bank account in your name isn't going to solve their tax problems.

  3. #3
    Join Date
    Jul 2018
    Posts
    1,534

    Default Re: Bank Account Under Daughter’s Name

    Quote Quoting Trane270691
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    My parents had me open a bank acct in my name for my father to direct deposit his check into to pay bills and groceries.
    You mean they asked you to do this and you agreed. When you asked them why they wanted you to do this, what did they tell you?


    Quote Quoting Trane270691
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    However he and my mother owe back taxes.
    What sorts of taxes? I assume federal and/or state income taxes.


    Quote Quoting Trane270691
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    Is this illegal for me to do?
    Well...you opened an account in your name for the sole purpose of allowing your father to deposit one or more checks despite having knowledge that your father and mother have unpaid tax obligations. In other words, you knew (or should have known) that this was being done to hide money. It might not be illegal, but it puts you at great risk. Not a good idea. They need to consult with legal counsel about how to deal with these issues without involving you.

  4. #4
    Join Date
    Dec 2009
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    Default Re: Bank Account Under Daughter’s Name

    Quote Quoting Taxing Matters
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    II strongly suggest you at the very least keep your own money in a different account at a different unrelated bank.
    I heartily agree. This way if the IRS freezes the account containing your parents' money and charges you with not reporting income or whatever, you will at least have access to some money you can use to pay the lawyer you hire to defend yourself.

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