How Google know that I pay for links?

Selected answers from the Dumb SEO Questions Facebook & G+ community.

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  Ben Baligad: Google says that if you are paid for a link, such as affiliate links,  ;then you should "nofollow". But, how do they know you are getting paid? They can't see money transactions.
  
  If where you are linking to  ;is a business site, then you are certainly under suspicion that you were paid. Therefore, you should "nofollow" to avoid suspicion.
  
  But, Google must rank businesses somehow. If not by links what? The links are either nofollowed or not trusted. Are there certain situations where using "follow" to businesses are  ;accepted?
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  Jann Grond: A dofollow link is a recommendation, link to "trusted" sites which give some kind of value to your readers. It's not too hard for Google to find affiliate links. If a link helps your readers, Google won't have a problem with for the most time..
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  Ben Baligad: Thanks for answering, Jann. But, I am not sure you answered my question. Are you saying Google will not have a problem with businesses that have "dofollow" as long as they are "trusted"?
  
  What is a "trusted" site? You can say non spammy, I guess. But, I always have a problem understanding with that word and Google uses it often. The term's meaning became anything against SEO> ;
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  Jim Munro: Hi Ben, thank you for your participation here. :)
  
  If you receive money or other compensation for the link, e.g. an advertising link I think you should nofollow. Don't concern yourself with what googlebot can figure out, you know what you are getting paid for.
  
  Similarly, if you are not being paid for the link in some way or another, I don't think you should nofollow it, whatever the circumstances. ;
  
   ;I can't guarantee this will keep you safe but if you adopt this policy, you'll have more time to spend on useful tasks. :)
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  Ben Baligad: Thanks, Jim. That certainly in line with Google's write up on Google Best Practices on nofollow. ;
  
  Don't nofollow in fear of what Google might do, as long as you are in line with them. Don't follow and think you can get away with it, if you get paid for the link.
  
  I like it.
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  PromozSEO: Do not think much about that rel attribute of a link. Google follows both and both have power and advantages.
  A sitewide dofollow footer or sidebar link can raise some questions but other than this, any contextual dofollow link which gets relevant and targeted traffic is always good and have no problems involved with it.
  I am not sure why anybody would give a dofollow outbound affiliate link from their site.
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  Ben Baligad: +PromozSEO ;, what comes to mind are guest posts. These, many times are money sites in which many site owners are not getting paid for. ;
  
  +Jim Munro ;, I know you said, "whatever the circumstances", but are guest posts game changers?
  
  While Google Webmaster Tools advices against "large-scale article marketing or guest posting campaigns with keyword-rich anchor text links", Google spokesman John Mueller says it is best to nofollow them.
  These are two different things. Following Google Webmaster Tools, you can have dofollow, but not keyword-rich.
  
  http://goo.gl/HGEpLf
  
  http://goo.gl/mNjYBq
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  PromozSEO: As +Jim Munro ;said, if you are taking or giving money for articles (may be guest posts or whatever), mark the links as nofollow, other than this a dofollow link should not create any problem. The best way is link earning.
  
  Over doing anything for links can be dangerous, diversify the link building process and analyze the site thoroughly before building links.
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  Ben Baligad: I like +Jim Munro ;'s post because when Google gives mixed signals, I think it is best to go to Google Webmaster Tools rather than their spokesmen. Google Webmaster Tools are readily available to all webmasters. People must chase spokesmen such us John Mueller and Matt Cutts around, and search for particulars. People such as me tend to over analyze. ;
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  Jim Munro: I have never known John Mueller to lie. Sometimes he might omit a facet of a question in a response but I think John genuinely tries to clarify wherever he is able to within the limitations he has to work under.
  
  The answer to the guest post question seems obvious to me. You know that you created the guest post for a benefit and benefits do not have to be measured in dollars and cents. I think any link from your article to any of your sites should be nofollowed. In a sense, a link from a guest post is an advertising link.
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  Ben Baligad: Sorry, I am kind of slow. I have to read, reread or on video, watch and re-watch. ;
  
  I watched John Mueller again.What he is saying is guest posts are considered unnatural and should be nofollowed. What he said was not in contrary to Google Webmaster Tools. It is just that GWT did not state that guest post links are considered unnatural when pointing to your site.
  
  Here now comes a dumb SEO question. We cannot dofollow link ourselves to link to our site without violating Google best practices. Should a link to our Google Plus profile or community that we own also be nofollowed or would it be safe to dofollow? Or, for that matter, any social site like Facebook and Twitter.
  
   ;
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  Jim Munro: You know that Google has not paid you for the link or compensated you in any other way. I think it should be dofollow.
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  Ben Baligad: It seems obvious, but just like guest posts, I thought Google might define ownership in a site and ownership in a social site profile the same.
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  Jim Munro: ...yes but you are linking to plus.google.com. Google owns your profile.
  
  Besides, linking to a PR9 site for relevant information is not a bad thing.
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  Ben Baligad: Thanks, Jim.