Honey101 Files: Bob's Advice to Becky the Babysitter

Author: Honeyoneohone (Original Post)
(with editorial comments "EC" by Kirk Lindstrom)

550. April 10, 2007 9:41 AM
» honeyoneohone - Brinker "Recharacterizes" Saturday's Comments on Sunday

Here is a transcript of Bob Brinker's comments that he made the very next day after Becky's call. You will see that rather than admit he was mistaken, he completely changed his tune about what he said to Becky, the babysitter.
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If you read the transcripts above (here) you will see that he actually PREACHED to her that she should accept the money as a gift and NEVER ONCE mentioned the word "illegal" when speaking to her. He certainly never told her that her employer was doing something illegal, as he blatantly claims here. (Note the number of times he used the word "illegal" in this obvious attempt to cover his "bases.")

Bob Brinker: "We had an interesting call on the program this weekend if you missed it (transcript), we had a call from a babysitter who was making $10,400 dollars a year - that's $200 a week for babysitting with some children in her neighborhood. It may have been with a friend, maybe not - it doesn't really matter. And she gone to her accountant and tried to open an IRA and her accountant was telling her that since she was not being paid legally that she could not use this money in her IRA.
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This of course, would have allowed her, if it was being paid legally to put up to $4000 dollars - because I believe she was under 50 - so she could have put up to $4000 dollars in her IRA account. And she wanted to do that, but her accountant told her that her employer was paying her illegally and so she couldn't do it. And this of course, opened a Pandora's Box for the woman because there's no question she is being paid illegally as we went through on the program in detail.
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We pointed out that her employer was breaking the law by not paying Social Security withholding, by not paying Medicare withholding, by withholding for the City of New York. It was a City of New York caller, by not withholding for the State of New York and not withholding for the federal. So there were five major violations being committed by her employer.

Now of course this put her between a rock and hard place because if she turns in her employer for breaking the law by not paying her properly and legally, then obviously, she could easily lose a friendship, if it is a friendship. Certainly she could lose a job. That's for sure. Her employer would be - to put it mildly - very upset to be turned in on something like this even though she's asking for it. Her employer is asking for it by conducting business in this way. So this is the situation that the woman faces. On the one hand, wants to do an IRA contribution but she's being paid illegally. On the other hand, she's faced with turning in her boss for paying her illegally which could easily cost her her job. Talk about a conundrum - that's a conundrum.


The April 2007 issue of "The Retirement Advisor" newsletter includes: A Primer on 401(k) plan fees TIAA-CREF Fund Family Warning FREE ISSUE	Bob's Advice to Becky The Babysitter (Part 3) April 10, 2007 Bob Brinker Fan Club home Page -	Best CD Rates

Author: Honeyoneohone (Original Post) (with editorial comments "EC" by Kirk Lindstrom) 550. April 10, 2007 9:41 AM » honeyoneohone - Brinker "Recharacterizes" Saturday's Comments on Sunday Here is a transcript of Bob Brinker's comments that he made the very next day after Becky's call. You will see that rather than admit he was mistaken, he completely changed his tune about what he said to Becky, the babysitter. . If you read the transcripts above (here) you will see that he actually PREACHED to her that she should accept the money as a gift and NEVER ONCE mentioned the word "illegal" when speaking to her. He certainly never told her that her employer was doing something illegal, as he blatantly claims here. (Note the number of times he used the word "illegal" in this obvious attempt to cover his "bases.") Bob Brinker: "We had an interesting call on the program this weekend if you missed it (transcript), we had a call from a babysitter who was making $10,400 dollars a year - that's $200 a week for babysitting with some children in her neighborhood. It may have been with a friend, maybe not - it doesn't really matter. And she gone to her accountant and tried to open an IRA and her accountant was telling her that since she was not being paid legally that she could not use this money in her IRA. . This of course, would have allowed her, if it was being paid legally to put up to $4000 dollars - because I believe she was under 50 - so she could have put up to $4000 dollars in her IRA account. And she wanted to do that, but her accountant told her that her employer was paying her illegally and so she couldn't do it. And this of course, opened a Pandora's Box for the woman because there's no question she is being paid illegally as we went through on the program in detail. . We pointed out that her employer was breaking the law by not paying Social Security withholding, by not paying Medicare withholding, by withholding for the City of New York. It was a City of New York caller, by not withholding for the State of New York and not withholding for the federal. So there were five major violations being committed by her employer. Now of course this put her between a rock and hard place because if she turns in her employer for breaking the law by not paying her properly and legally, then obviously, she could easily lose a friendship, if it is a friendship. Certainly she could lose a job. That's for sure. Her employer would be - to put it mildly - very upset to be turned in on something like this even though she's asking for it. Her employer is asking for it by conducting business in this way. So this is the situation that the woman faces. On the one hand, wants to do an IRA contribution but she's being paid illegally. On the other hand, she's faced with turning in her boss for paying her illegally which could easily cost her her job. Talk about a conundrum - that's a conundrum.

Now as far as gifting is concerned: yes, it's true, as we pointed out that you can give up to 12 thousand dollars a year to anybody you want - family or non-family. But it can't be done as a substitute for compensation for services rendered, so it doesn't apply obviously in the situation like that. And it wouldn't help the woman anyway. She wants to put money into her IRA account. You can't put gift proceeds in an IRA account. But it was an interesting call. This is Moneytalk"______Bob Brinker -- posted by honeyoneohone EC: I believe Bob Brinker has "recharacterized" what he said to Becky the next day. I was quite dissapointed that he did not admit he simply made a mistake and gave her bad tax advice.
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