I knew this would happen, if you don't pay taxes, you cannot prove you need to be paid for lost wages or income

It is well known in Louisiana and probably all along the Gulf Coast with fishermen and those who sell their products, some sales and wages are "under the table." I have known some of them and they are very proud of how they get around the tax man.  They drive better cars, live in nice houses and somehow their income shows it is below the proverty level.  As a well reported Rev. Wright said, "the chickens have come home to roost." I feel for them, but.......  
This article is from the Houston Chronicle.

Fishermen caught in a quandary

Not keeping records in cash-only industry puts compensation at risk

By RENÉE C. LEE

For as long as many can remember, the Gulf fishing industry has operated on a mostly cash-only basis. Shrimp and crab are purchased on the dock with cash and deckhands who help on the boats are paid in cash.

"It's an industry that goes back seven and eight generations," said Ewell Smith, executive director of the Louisiana Seafood Promotion and Marketing Board. "It's based on relationships and handshakes, and it doesn't change much."

Fishermen are supposed to keep records of what they sell and pay taxes on their income, but many sell under the table and skirt the law. The scofflaws now may lose a chance to get a share of the $20 billion BP oil compensation fund set up to help individuals and businesses hurt by the largest-ever oil spill in the Gulf of Mexico. Without verifiable proof of income, they cannot access the fund to recoup any financial losses.

St. Bernard Parish President Craig Taffaro said he would like to see a federal tax amnesty for those fishermen who have not paid their taxes and has shared his idea with a U.S. senator. Any compensation fishermen receive will be taxed, and for those who have not followed the law, that could trigger IRS scrutiny and, possibly, retroactive tax payments, he said.

"These are people who are not used to operating in a corporate world," Taffaro said. "There needs to be a separation between tax obligation and the ability to validate appropriate compensation to these fishermen."

Not everyone supports the idea, especially some fishermen who have lived by the industry's honor system and abide by state and federal laws. About 40 percent to 50 percent of what a fisherman catches is sold for cash, said Peter Gerica, a third-generation fisherman from New Orleans.

"I don't think you should reward people for doing wrong," Gerica said. "I feel like, if you play, you gotta pay."

Smith, whose organization represents 13,000 fishermen and processors, said he understands Taffaro's compassion. No one wants to see any hard-working fishermen miss out on assistance, he said, "but that's what happens when you don't pay your taxes."

There is more, read the rest here.

Taxing relief that replaces income -logical?

I think it is, if it is replacing  what you would be making with a job or business. This is from Fox News

IRS May Tax Payments to Gulf Coast Victims

NEW ORLEANS — Out-of-work Gulf Coast shrimper Todd Pellegal spent his first $2,500 check from BP quickly, paying off bills and buying groceries for his family.

He never even considered putting some of it away for taxes.

Now he's among the people up and down the Gulf Coast reeling from the oil spill disaster who are surprised — and frustrated — to find out the Internal Revenue Service may take a chunk of the payments BP PLC is providing to help them stay afloat.

Many were already angry about how long the oil giant took to cut the checks. So when they got the money — generally about a few thousand dollars each so far — they spent it fast.

"If they're going to pay you a lump sum, like for a year, then bam, take the taxes out of the check," said Pellegal, of Boothville, La. "But a little bit at a time, they shouldn't."

Accountants have been trying to nail down the implications for thousands of taxpayers after President Barack Obama said BP would create a $20 billion disaster fund and provide another $100 million for oil workers who lose their jobs because of the six-month moratorium on deepwater drilling in the Gulf of Mexico.

Read the rest here and tell me what you think. 

I have known many people in that area who do not declare all the money they make by shrimping, oystering, and some of the tourist related business.  I am not painting all with a broad brush, but the people who are writing the checks know they must have proof of how much was actually made.  I have a hunch some people are going to be shorted because they have left half their income as unreported to avoid taxes on it. They are the same people who are going to be incensed on being taxed on money they are given for relief, even though it is replacing previously earned income.