Tell me how/if this is illegal.

[wiffle]

SIL was telling me about the great deal she gets from her daycare provider. Apparently the daycare has too many families that pay full price so SIL pays them a reduced price in cash (presumably under the table) so the daycare doesn't have to count them and its a win-win. This feels like its illegal/fraud/tax evasion but I don't know exactly why. Why does it matter how many families pay full price? I thought any low-income assistance went through the family and not through the daycare. SIL does not qualify for assistance and lives in GA. Does this make sense to anyone?? Any help would be appreciated.

[ECB]

Um - if this means the DCP is over her kid to adult ratio, if her state's daycare licensing board ever does a spot check on her house - she'll be in trouble for having too many kids! She absolutely has to "count" them in her ratios. She's an idiot who probably is trying to skirt the system and make some extra $$.

[jennistarr1]

where there is smoke, there is fire

[UnderProtest]

1. If its under the table, it's tax evasion.
2. If it isn't counting towards their numbers, it is breaking the state regulations on the kid to teacher ratio which is a code violation at least.


I don't know about the low income part, but it just sounds shady.

[Deleted]

Jan 31, 2013 9:37:29 GMT -5 ECB said:

Um - if this means the DCP is over her kid to adult ratio, if her state's daycare licensing board ever does a spot check on her house - she'll be in trouble for having too many kids!

Not only that it means her child is not safe there b/c of the illegal ratios! 

[aspentosh]

Jan 31, 2013 9:38:07 GMT -5 UnderProtest said:

1. If its under the table, it's tax evasion.
2. If it isn't counting towards their numbers, it is breaking the state regulations on the kid to teacher ratio which is a code violation at least.


I don't know about the low income part, but it just sounds shady.

This. I'd be worried she's not claiming that income AND she has too many kids in her care. Not good.

[Susie]

I would assume it doesn't matter how many pay full price, but rather, how many kids are reported/on the books as being cared for. It sounds like your SIL pays less, which the DCP keeps tax-free, and her kid isn't officially there. If that's true, it's shady as hell, not to mention illegal on several levels.

[julygal]

I agree with PPs that she most likely doesn't want to report income and is trying to keep her ratios looking correct on the book.

[takeonyou]

Dude, people like that give us all a bad name. Something isn't right and ibwould not want to be part of that.

[wiffle]

Thanks for the responses! I get that the daycare is not reporting the cash payments in their income. Can SIL get in trouble since she obviously knows because of the reduced rates she's getting? I also know SIL won't have any records to claim the daycare expense on her own taxes. But wouldn't the daycare know they're going to have inspections done? Are inspections announced? Why would you have too many kids/adult? Seems like an easy thing to get caught doing. And wouldn't that mean there are no files for SIL's kid? No emergency contact, no shot records?

[ECB]

Jan 31, 2013 9:50:08 GMT -5 wiffle said:

Thanks for the responses! I get that the daycare is not reporting the cash payments in their income. Can SIL get in trouble since she obviously knows because of the reduced rates she's getting? I also know SIL won't have any records to claim the daycare expense on her own taxes. But wouldn't the daycare know they're going to have inspections done? Are inspections announced? Why would you have too many kids/adult? Seems like an easy thing to get caught doing. And wouldn't that mean there are no files for SIL's kid? No emergency contact, no shot records?

I don't know if your SIL can get in trouble.  If she isn't reporting the expense (like - I use the dependent care FSA and as such, I have to have receipts showing what I"m paying), it may not affect her.  But I don' tknow for sure.

I know that my DCP sometimes has scheduled inspections.  But they do also sometimes do surprise visits.  It's not often.  Heck,  might not be more than once a year.  BUT it does happen!   And it will affect your SIL if suddenly her DCP says "Oh- I can't have you here anymore" OR she's closed down because of whatever violations they find!

[madringal]

It is always these types of daycares that end up on the news. Too many kids, not enough adults, fire or something bad happens, and all the parents are like, "I had no idea." Your SIL is going to have some serious guilt if something bad happens just because she wanted to save some money.

[anniegoolahey]

When I was a child, an adult closely related to me had a best friend who ran a home daycare. I remember my relative taking a few of the children when there were inspections. I specifically remember a time that my relative told the inspector a lie about leaving her children (they weren't her children) in the house while she got something out of the shed. She lived only a few houses down, so it was an easy lie to pull off. She'd leave with the kids and bring them back after the inspection. Depending on the laws where you live, this might be easy enough to pull off.

It's funny how as a child this didnt seem odd to me at all.

[wiffle]

I think SIL meant that they have too many families that are full time. This all makes much more sense than the daycare having too many families that pay full price. Unfortunately this is par for the course when it comes to SIL's parenting decisions where money is involved. Thanks again!

[jennistarr1]

Anniegoolahey...is your avatar Goldie Hawn from overboard...that's hilarious!!!

And I bet that did seem odd to you as a child because you remembered it

[Deleted]

Jan 31, 2013 10:01:54 GMT -5 madringal said:

It is always these types of daycares that end up on the news. Too many kids, not enough adults, fire or something bad happens, and all the parents are like, "I had no idea." Your SIL is going to have some serious guilt if something bad happens just because she wanted to save some money.

Ditto!  Last fall a bumpie's kid died in one of those DC's.

[cjeanette]

So illegal.

My cousin had a provider like this when her daughter was a baby. It was a close friend and she trusted the ratios with this person and didn't mind not getting the deduction.

All was well until the state come for it's annual inspection. She was shut down and my cousin had to find alternate care on no notice. Not fun.

[imojoebunny]

Yep, it is illegal. I live next to an accredited daycare with a good reputation. They do illegal crap all the time, then lie about it, so I a not surprised. Using prisoners to clean up their property is just one of many examples. Georgia has very little oversite, just not very many investigators, so they can get away with it for a long time, even if someone were to turn them in.

[iheartbanjos]

Actually, the too many families that pay full price makes sense to me.  We looked at a montessori school in the area that had a special grant from the state.  Because of this, they could only accept 20% of the families who pay full price and the rest had to have some sort of need based assistance.  It had nothing to do with ratios in the classroom.

[wiffle]

This SIL buys monogrammed clothes for her child and professional pictures almost monthly but can't afford formula or her medical bills (MIL pays those). And she agrees with H that MIL is an alcoholic but still let's her watch the kid so she can get her nails done. If you try to give her advice or criticize her parenting choices she just digs in her heels to show you that she can do what she wants. I was hoping that I could tell her how this could get *her* in trouble so maybe she would take my advice to find alternate child care.

[Deleted]

Jan 31, 2013 11:19:15 GMT -5 imojoebunny said:

 Using prisoners to clean up their property is just one of many examples.

OMG!  I have no words for this either !

[momabear]

I would question if the daycare provider is licensed at all. We had this happen in our neighborhood. A woman who was doing daycare decided not to renew her license but kept the daycare open. She offered all her families a big discount if they paid cash and didn't report it on taxes. That way there was no threat of surprise inspections. It seemed so dangerous.

[macmars45]

I went to an in home child care growing up. The provider was over ratio the whole time. It's illegal. No parents reported her because they all loved her and she did a great job. She's a second mom to so many of us that went there from 1-11 years old. My sisters and I still go see her at least a few times a year.

A neighbor reported her eventually and now she's always in ratio.

[regina22]

Jan 31, 2013 11:20:40 GMT -5 iheartbanjos said:

Actually, the too many families that pay full price makes sense to me.  We looked at a montessori school in the area that had a special grant from the state.  Because of this, they could only accept 20% of the families who pay full price and the rest had to have some sort of need based assistance.  It had nothing to do with ratios in the classroom.

This was my first thought. In which case the SIL would be going along with committing fraud. If the DCP is receiving grand money for having need based children there, then having the parent pay cash so there won't be a paper trail that they're not actually qualifying for the discount, it's a problem. All legal matters aside, this is one of those areas where ethics need to come into play. If true, her kid is taking the place of an actual kid in need who can't afford a full price tuition and really could use the break in rates. This is the exact age when you need to start teaching right from wrong, and not reinforcing situational ethics because it saves you money.