> How does the IRS know if my LLC was paid?

How does the IRS know if my LLC was paid?

Posted at: 2014-12-08 
Income from the LLC will have to be reported to the IRS by the members (owners) of the LLC. The LLC will still have to file Federal returns using it's Tax ID (EIN).

http://www.incsmart.biz/What-is-a-US-LLC...

So im starting an LLC soon and was wondering how my profits are claimed and how the irs knows if i actually made any money.

Say i start a tutor business with me as the only tutor. I go to clients houses and they cut me a check under my LLC's name. I deposit the check into the LLCs bank account. Then at the end of the year i would claim profits right? So how does the irs know how much i was actually paid? Couldnt you just lie and say you only made $500 when you actually made $1000? There is no actual paperwork for the payments you received?

Another situation, say i start an LLC that is a staffing company. Companies hire me to find workers for events they put on, or to find servers for a private party...ect. So my company would find the workers and have them filed as a subcontractor to work the event. I have them fill out a w9 and then i fill out a 1099 misc to report their wages, correct? Now does the company that hired me to find the workers just cut me a check without any paperwork (tax forms) for me to fill out? Or Would i have to fill out a w9 for the company throwing the event and they also fill out a 1099 misc for me? Or do they just cut me a check and i deposit it into my company's bank account, then pay my subcontractors and again have no paperwork of reported earnings.

This gets confusing to me. I could explain further but i think i will leave it at that for now.