I've never heard of this. How would it work? I assume that the $100K would be W2 income (a requirement for corporate sponsorship) and all of the related income taxes for both the employer and employee are paid up. How would the IT company get paid back without having to report this as something like sales income/revenue? Unless the "boss" is getting a personal cash kick-back under the table, I don't understand how this could even happen. If the "boss" is not the sole shareholder this is both extortion against the employee and embezzlement against the company - and probably tax evasion. If the sole shareholder, then still extortion and (probably) tax evasion.