Direct deposit into another acct

[trane270691]

Jurisdiction

Arizona

Is it legal for a parent to direct deposit their check into their child's bank account if they owe back taxes? The checks are used to pay groceries and bills. If not legal, what consequences will the child face?

 

[adjusterjack]

Is it legal for a parent to direct deposit their check into their child's bank account if they owe back taxes?

No, it's defrauding a creditor and it's certainly not legal.

If not legal, what consequences will the child face?

If the child is a minor, none. If the child is an adult and goes along with it, he/she is complicit in the fraud.

 

[trane270691]

No, it's defrauding a creditor and it's certainly not legal.



If the child is a minor, none. If the child is an adult and goes along with it, he/she is complicit in the fraud.

Thank you. I was told by someone not in the tax field that since the money was being used and not just held in the account for saving, it would be fine and that it wasn't fraud. I felt otherwise. Thank you for confirming that.

 

[trane270691]

No, it's defrauding a creditor and it's certainly not legal.



If the child is a minor, none. If the child is an adult and goes along with it, he/she is complicit in the fraud.

One more question, if that person didn't owe back taxes, would direct depositing a check into their child's acct be allowed?

 

[PayrollHRGuy]

There is no law that requires a paycheck be put into any bank account at all.

 

[trane270691]

There is no law that requires a paycheck be put into any bank account at all.

Right but if they wanted it to be direct deposited somewhere, would it be allowed to be put into their child's?

 

[PayrollHRGuy]

I don't think it would be illegal in either case. It would likely be against the DD agreement the employee signed when they signed up dor DD with the employer if they don't have the right to sign on the minor's account. If they do have the right it is just another account.

 

[trane270691]

I don't think it would be illegal in either case. It would likely be against the DD agreement the employee signed when they signed up dor DD with the employer if they don't have the right to sign on the minor's account. If they do have the right it is just another account.

Okay, so it wouldn't seem like the child is hiding the parent's money from the IRS?

Also this is not a minor. They are in their late 20's.

 

[PayrollHRGuy]

Okay, so it wouldn't seem like the child is hiding the parent's money from the IRS?

Also this is not a minor. They are in their late 20's.

Then the kid is no longer a child. But that doesn't really matter if the conditions I already wrote are in place.

One thing that should be kept in mind is that if the parent(s) are signers and co-owners of the account and the taxman finds out about the account they can place a lien on that account as well.

It would really make more sense for the parents to start getting a check and cashing it.

 

[cbg]

Mandatory DD is legal in the OP's state - just sayin'.

 

[PayrollHRGuy]

Mandatory DD is legal in the OP's state - just sayin'.

Not so much under 23-351



E. When an employee's wages are paid by deposit in a financial institution the employee shall be furnished with a written or electronic statement of the employee's earnings and withholdings. Any wage deposit plan adopted by an employer shall entitle the employee to one withdrawal for each deposit, free of any service charge to the employee. The consent of an employee for payment of wage by deposit in a financial institution shall not constitute a prior assignment of wages to the financial institution and is revocable at any time before the transmittal to the financial institution by the employer. A person shall not be denied employment, be discharged or be reprimanded for refusal to consent to payment of wage by deposit in a financial institution.

 

[cbg]

Fair enough.

 

[zddoodah]

Is it legal for a parent to direct deposit their check into their child's bank account if they owe back taxes?

Assuming it's a minor child's account under the parent's control or an account belonging to an adult child who gives permission, yes.

No, it's defrauding a creditor and it's certainly not legal.

I couldn't disagree more. A person is free to put his income virtually anywhere he or she wants. It's not illegal, and the fact that the person might be hiding the money from a creditor doesn't change that.

Okay, so it wouldn't seem like the child is hiding the parent's money from the IRS?

Of course it "seems" like that, but that's not illegal.