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Carol In A Conundrum wrote:

Hi, guys —

I have a question regarding a Catholic working for a very small company that is guilty of tax evasion. This small company (it's basically a one-man show with one owner who does most of the work and has a handful of employees) does not disclose around $100,000 of taxable cash income to the IRS each year. This has been happening yearly for around 20 years.

  • What, if any, are the moral implications of a Catholic working for with this company, knowing that the owner is committing tax evasion?
  • Additionally, what would be the moral implications for a Catholic if he chose to form a partnership with this business owner, making parts for the owner's business?

In addition to his own tax fraud, the business owner pays cash under the table and does not provide this employee with a W-2 or 1099. This makes it difficult for the employee to claim his own income when filing taxes.

If it matters, this job/partnership for the Catholic is more of a hobby. The Catholic has another full-time job, and income from this tax evading company is not needed for the Catholic to have food and shelter.

To my knowledge, the only reason the business owner does not disclose his cash income to the IRS is because he does not want to have to pay taxes on it, keeping more money for himself.

Thank you for any input you can offer!

I would be very grateful for your help.


  { What are the implications of a Catholic working for a company that's committing tax evasion? }

Mike replied:

Dear Carol,

Since your question touches on clarifying issues of Catholic morality, let me suggest a few postings and make a brief comment. The following posting (below) and additional postings appended at the end of the answer dealing with software piracy, (Under Similar Issues, at the end) will give you proper guidance:

I have included portions from the Catechism of the Catholic Church dealing with:

  • Offenses Against Truth, and
  • The Morality of Human Acts.

Assuming the information you're sharing with us is accurate then I would not associate with this person, even if on a hobby basis. Since there are probably many nuances to your specific situation, beyond what I have said and what is posted, I would find a good, faithful priest and discuss the issues surrounding this man and whether the matter should be brought to the proper police authorities. Again, assuming what you have said is true, I see no way that any faithful Christian can condone known, ongoing, massive tax evasion.

I would be interested in what my colleagues think.


Carol replied:

Dear Mike,

Thank you so very much for your insight! I have read all of the similar issues links.

Yes, this situation is much more nuanced than I originally posted. The business owner in question is my brother-in-law. The Catholic who wants to continue working for him is my husband, the business owner's brother.

Now my husband is claiming that he doesn't know if his brother is still committing tax evasion on the scale of $100,000 of unreported cash income per year, though he did not report that much several years ago yet, a few months ago, my husband claimed it to be the reason why his brother could not pay him $3,000 that his brother owes him for work my husband did. My husband claimed that his brother didn't like putting money in the bank in order to write a check, because the IRS might then realize he makes more cash income than he discloses, to the tune of $100,000 cash each year, so now I am not sure if this is still ongoing or not. (I am assuming it is ongoing, based on the extravagant vacations my brother-in-law has been taking.)

  • My husband is also claiming that his brother pays a lot of taxes anyway, and that he didn't get a small business COVID stimulus package from the government, so what does it matter if he doesn't report cash income?

My husband also claims he will do our taxes this year, so that I don't have to lie about where, $12,000 his brother paid him for work, came from, since his brother did not provide him with a 1099 or W-2. I would still have to sign the taxes though.

Last year, my husband invested over $8,000 into forming a business partnership with this brother without telling me. I was livid when I found out. I suggested therapy, which he immediately shot down. His brother did pay him back, albeit four months after their agreed-upon date.

I believe that right there, should be reason enough for him to never be involved in his brother's business again.

  • When is lying to your wife and hiding things from your wife and disrespecting your wife okay?

Thank you again for your help!



John replied:

Hi Carol,

Let me add some pastoral advice.

This is a complex situation just in terms of the legal issues but there appears to be a complex corollary issue in the way: it's impacting your marriage . . but . . . there is a very fundamental issue behind all of this.

Fidelity to the Church's moral Teachings must be based on our fidelity to Christ Himself and our relationship with Him. We can't just follow any of the Church's Teaching out of legalism or fear. Rather our desire to do God's Will must spring naturally from our relationship with the Lord.

St. Paul writes to the Romans in chapter 8 that we must walk in the Spirit and by the Spirit put to death the deeds of the flesh. Deeds of the flesh doesn't just mean sexual lust. Rather it means anything motivated our self-serving sin nature or concupiscence. If we try to do the right thing, in our own strength, we ultimately are doomed to fail even if we succeed. That's right because, if we succeed in our own strength, rather than by the grace of God; we take the credit and become self-righteous.

So I would first begin with a self examination and then humbly assist your husband in developing a great relationship with the Lord. That is what will bring about a change of heart. It will allow the Holy Spirit to convict him of any wrongdoing and the Holy Spirit will give him the grace and strength to do the right thing.


Carol replied:


Thank you very much for the pastoral advice. I greatly appreciate it, more than you could possibly know. I most certainly have the faults of trying to succeed on my own strength, rather than by the Grace of God.

Sadly, I have no idea how to humbly assist my husband in developing a relationship with the Lord.

  • Do you have any suggestions for me?


John replied:


It starts with you developing a close relationship with Christ.

Read Scripture and meditate on it. Start with Matthew chapters 5 and 6. That's the sermon on the Mountain. Also Ephesians 5 and Proverbs 31. Alternate:

Ponder it. Prayerfully ask God to help you understand it and live it. Understand, that you can understand and live it by placing your faith in Jesus, uniting yourself to His Sacrifice and Humility.

Think about it. God Almighty, humbled Himself to point of having His diapers changed! Pray for His humility then simply pray for your husband. Pray that God touch his heart and draws him closer to Himself.

As you both draw closer to Christ, you will both draw closer to each other.

Start there. God will show the way and give the supernatural wisdom needed.


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