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[email protected] and now here's your host, Lyster.
[00:00:21] Today's episode is a shout out to all the small business owners out there. If you're a small business owner or thinking about being a small business owner, I guarantee you today's episode is going to be for you. Hope that it's beneficial and helpful for you as I take you down a journey, take you down a rabbit hole, and I hopefully share some information you probably knew, or if you didn't know, if it's helpful, let us know. Casualtalkradio.net my name is Leister. I'm your host, and today I'm talking strictly about one thing that came up on radar. I realize some people may not understand what happened, and I figured it was an obligation and an opportunity to share some information to help people out. As I'm a small business owner myself, having owned, let's see, five businesses over time, and now I currently have one that has, you know, five brands, but it's one business entity over top of it. And I'm debating whether or not to dissolve the business. But I realize that if I do that, it's going to affect the business banking. So if I, I have to think that through and decide what I'm going to do and, and realign things, and I think it's fine, but I just got to figure it out from, from the banking aspect. I do plan to change banks simply because they're no longer local to where I am. So it may be the opportune moment to reconsider everything, figure out how to open up a new bank, you know, account somewhere that's closer and has more branches. I'm not doing Wells Fargo. They're a bunch of scammers. I'm not doing bank of America. They're a bunch of crooks. And I'm not doing chase because their online won't let me do it.
[00:01:54] You may or may not. If you, let's say that you're in the cause again, people may be in the category that they are a small business owner, or you're in the category that you're thinking about being a small business owner. If you're in the category of having been one in the past, this doesn't apply to you, but it also affects anybody who happens to be a beneficial owner of a business, as in you are not necessarily running it running day to day ops of it, managing it, controlling it. But maybe you have a majority ownership stake. Perhaps you inherited it right from parents. This is why I wanted to try to use the platform, though limited, to share the information, because you may not realize that it does affect you in some way. This may have already been put on your desk, I don't know, I doubt it, but may have been put on your desk. Now I'm just gonna tell you, I don't think it's as bad as it seems. However it is, it sets a bad precedent and it's somewhat stupid. That's my focus. What I refer to beneficial ownership information report from the financial, basically the financial crimes system of the government. And this report, all it does, all it does is document who are the beneficial owners for a given company. People are like, well, how does that apply and who does it apply to and who's covered under it? Well, the truth is, if you were required to form a business, when I say a business, I'm not referring to a sole proprietorship type business. A sole proprietorship is a business only in brand. You are not an actual formed business, an organized business, a structured business. These are businesses where there would have been an articles of organization, articles of incorporation, that document who has an ownership stake in the business. They are treated differently from a tax perspective. This is a completely different structure than specifically a sole proprietorship. But there's other types. A sole proprietor. You are an individual who happens to operate as a brand. You don't need to do paperwork to be an individual that's operating as a brand. Now you may do trademarking or other types of paperwork. I'm talking for the formation within a state. The state doesn't care if you're a sole proprietor because for the purposes of taxation, you're taxed as an individual person. It doesn't really matter. Most people that are out gig workers, say, or ones that work w two on contract are just sole proprietors. They just do sole proprietorship. There was an increase, and I'd say probably about 15 years ago, there was an increase in the number of people who instead would form an LLC rather than stay sole proprietor. Why? Because the tax treatments different. As an individual, you are required to do withholding. The IR's will literally come after you if you do not do withholding, because it's all a big pyramid scheme. At the end of the day, they need to have a steady stream of money coming in. If they don't get it, they'll go after you. They won't go after those people that are making, you know, tens of millions of dollars, they won't go after them, they'll go after you, the low level, because it's low hanging fruit. And they know you can't fight them, so they threaten you, and then they'll sue you, and then they'll arrest you, and they'll do all sorts of stuff to go after the low level person. Not the big wigs, but the low level people. The states are roughly the same. Not all of them, but a lot of them are the same. They know what the game is because they know it's a pyramid scheme. They know they cannot rely without steady stream of money coming down to them, which is the flaw of income tax. And the reason that Leister here has always supported a consumption tax. A consumption tax simply pays out of the consumption that we normally do. And then it's up to the businesses who take money in to send that money up to the government, as opposed to money taken away from you simply because you were a productive member of society. I digress. Off the ramp.
[00:05:38] The beneficial ownership concept is specifically for formed, structured, organized, incorporated businesses. And you might have had some exposure if you're a beneficial owner, they might have had you sign some stuff, right? One of these documents might be in articles of organization, articles of incorporation. These documents say you have a 25% or 30% or 50% stake in the business. In an LLC, which is the most common form because it's the easiest to form. You might have just a sole member, managing member. You might have two or three members, but you usually have like one member. That's. You're just using the LLC as a quote front for business transactions. The business transactions in and out go through the business. The business is then supposed to pay you for the IR's side. They want to see that. Then the business is paying you payroll. They want to see that there's payroll taxes withheld. Why? Because there's another Ponzi scheme, aka Social Security, which is brokered specifically around payroll taxes. That's the whole point. If they don't get payroll taxes out of you, the Social Security system crumbles. They know that. And as people are age out of the workplace, they already know that it's insolventhe. But again, they'll threaten you, they'll go after you. They'll do everything they can to get from the low level instead of the wealthy. And the wealthy generally do not take significant salaries. You'll see that they took a salary of a dollar or a salary of $10 or a salary of $5 because most of the money that they make comes in the form of what, stocks, bonds, some sort of thing that is not immediately taxable because they did not cash it out. They only get taxed as capital gains when they cash those things out.
[00:07:22] The government decided there's a lot of crime. They, I'm saying literally, they decided there's a lot of crime where it's being hidden by these formed entities, and we have no idea who is running the companies. That's a lie because they could always contact the states. Because you are required to form this, you know, entity with documents. There's significant documents that you must file with the state. The feds could literally go to the state and get the same information that they're asking on this form. Yet FinCEN is requiring you to duplicate your efforts and fill out the same information that's already on file with the state.
[00:07:57] And it's an honor based system because they're not vetting that information against the state records, they're just collecting it for why? Because it's another layer of inefficiency and extra expense because there's expense to do this. If you do it yourself, it doesn't take that long. The form simply asks about, and I'll get to this secondary stupidity in a moment, but it only asks about information about the owners. You have to give your id. So whatever that is, passport, driver's license, whatever that is, it's largely targeted towards the foreign based entities, but everybody's subject to it. So if you have a company that was formed prior to January 2024, there's less information you must produce, which is stupid. If you form after formed, past tense, after January 2024, there's more information you must produce. And it really has to do with whatever entity assisted you in setting up the company, because they're trying to identify if that person or entity got enriched off of the formation, etcetera and so on. But my bottom line, number one, you need to understand it's not just the people on the company that are required to do something if you are a beneficial owner of a company, and you might not know that you are, if somebody added you as beneficial owner of a certain entity, and it's unlikely that could have happened without your knowledge. I'm saying that it could have. If you're a beneficial owner, you are required to be listed with the FinCEN, which includes all of your identifying documentation having been submitted to the government, although in duplication to the information already submitted to the state. I'm ranting because I think it's stupid? Because I would rather Fincen, go to the states and get the same paperwork already there. It's already on record. Fact. In some cases, it's public record. In some states, you can literally go to the site and pull it, but they would rather have you duplicate the same information that's already there. Same beef I have about companies, government entities that ask you for your birth certificate. Literally go to the state and pull it from the digital record. You're authorized. You're the feds. They don't do that because they're trying to put you on the hot seat to deliver this information directly to them, though duplicative, and then don't do anything with it because as of right now, there's no annual requirement to file. So you're like, what's the benefit? Because they claim, and this is why I'm stressing, they claim to not know who's behind these companies, despite the fact it's filed at the state level. I have a theory. Tenfold though I might be. I have a theory. My theory is that the states don't want to provide that information to the feds. My theory is that the states would rather control that and manage it for the businesses that, you know, transact in their state. My theory is that the feds really have no business looking at that information. And there's specific types of businesses and specific types of people that they're looking for, likely those that have an indian last name. And rather than be accused of some sort of racism, they decided to throw a wide blanket across all businesses, needle in a haystack, to try to pick out the one or two that they're trying to get at. Why is that? My theory, because that's what they did with the Patriot act. That's literally what they did. They said, everybody subject to Patriot act, which is any court of any kind of loan, any sort of transaction over a certain amount, we want to know about it. Duly noted. And then all these lenders had a document reported, and then they picked and chose certain select people who happen to have, what, some sort of an Indian or some sort of Arabian or some sort of, you know, non US based last name that seemed to match a terrorist on record in some obscure list somewhere. That's what they do. Wide swath. Same thing with the phone listening that they did ages ago, before we got rid of copper. Wide swath. Let's collect up all this information. Let's just scrape all this bounty of information so that we can pick and choose and needle these ones that we can go after instead of using warrants, let's say. So let's talk crime. If there's a crime, if there's a financial crime that you see, there's some sort of criminal behavior or activity that's happening in some area and it's got a company around it, you go to the state and you say, we've got evidence of a crime. We need to what's called Pierce the veil of this company and get access to their articles of incorporation, articles of organization. The state would gladly comply with that if there's some sort of legal order that they must do so. If it turns out that they didn't form an articles of incorporation of articles or organization, what's the point then of me having to submit the beneficial ownership information report because it would be fake information anyway because they're not vetting it against the state? Do you understand when I keep saying I'm tinfoil and a lot of this stuff because I understand the way that the federal stress federal government works. They would rather just blanket violate your privacy and pull all sorts of information that they have no business getting or that's already in places at the state level where they could get it when they need it. They would rather have all this information not really directly entitled to and do an end run around the constitution because that's what they do. You might have heard that there was a court case that was designed to block this as overreach. That court case only applied to the specific entity that filed it. Could your company file the court case and do the same thing? Sure. You could tie it up in the court system. Absolutely. If you got the money to do that and keep fighting and fighting and fighting, and if you didn't read about the ripple case and how many years it took them to finally get that case resolved, only to have the government go right back at them. When you have an unlimited spigot of funds to keep attacking and attacking and attacking this, my friends, is what Stymie's small business success. When you do things like this and they say, no, we have to do this because there's criminal activity. Rather than actually finding direct evidence of said criminal activity specific to the company, and rather than going directly to the state with an actual legal order vetted by a judge to get the information specific to the company alleged to do the crime, they would rather do a wide net, find all the information, force you to go through this nonsense? Yes, you can go through whatever organization or lawyer helped you form your company and pay them an egregious fee to help you all set it up. The IR's isn't going to let you deduct it.
[00:14:07] It's all a scam because they're taxing you for the benefit of filing a form that is duplicative of information you already filed with the state.
[00:14:16] Now that's the other tenfold. Right. Additional tax revenue. Because if you do it yourself, you're losing money because you're going to have to do that on the, on the clock. Somebody's got to do it on the clock. So that money is not used for actual profit. It's usually going to be an accountant or somebody in your finance, but generally accounting department that's going to do this stuff might be somebody in your legal department that's doing it. That's time. They're not going to be able to dedicate to other work that actually is beneficial to your organization. So you're essentially losing money on it. If you pay your formation organization or your attorney, you might not have had to do that prior to this. So maybe you have them on a retainer where it's kind of included. Chances are it's not, chances are it's an extra fee that you'll have to pay and it's not going to be tax deductible because that's what they want that extra tax money off you. Right. So tinfoil me though, you might. I see what's behind this. I see what's driving it. Again, some people will say it's not a big deal. It's not the, it's the principle of it. It's not the level of effort. It's the principle of the fact that the information they want already exists at the state. It literally already exists at state.
[00:15:25] Or if you have a formation organization, somebody who set it up for you, they've already collected every single thing on that form. Just make it to where they can't charge for that and they're required to do it. If they form the company, you are required to file beneficial and you cannot charge for that service. Great, problem solved. Because then it doesn't matter. Because then it's just part of the routine of what they do. Well, then that company's going to flack and then they're going to stop offering the service. Right. Because there's no financial avenue, you know, it costs them money to do it.
[00:15:54] I don't know what's going to happen. I know most people are required to submit the at least the initial prior to the end of the year. December is the deadline for the vast majority of companies out there. And again, the information you must submit is different based on the nature of your company and when it was formed. I'm not suggesting that the need isn't legit. I'm saying that the wide net approach of it is sketchy at best. There are specific companies they're trying to go after, the specific types of entities they're trying to go after, and chances are they happen to come from India based organizations or China based organizations only. Okay, go after them. Quit worrying about what social media says about being racist. If you, if it's true that you're going after crimes, we know China based llcs have done sketchy business, especially around the housing market. India based llcs have done sketchy business everywhere else, especially cryptocurrency. So go after them. If that's really the source of your aggravation, go after them specifically and ignore social media. The rise of social media is part of the problem because we didn't have this issue prior to social media with these wide net stuff outside of Nixon. But I'm saying there was a better way to do what I think they're trying to do, which is to target those specific companies that have ruffled their feathers. And instead of pissing everybody off and adding a burden on everybody, how about you go after who it is that you specifically need information from? That's my personal take on it. Anyway, you got options. You can file that form yourself again for free on their site. They have an online deal. You can fill out the PDF and submit it that way, or you can go through your attorney and or formation, you know, entity, whoever set it up with you or for you. You can have them do it and pay them a fee to do it. You got multiple ways to do it. Chances are you will need to do it. It's unlikely that you're not going to need to do it if you're a business that's formed. I stress if you're a sole proprietorship and it's important you understand the difference. If you are a sole proprietor, you are not required to submit the form because they already know who you are. You are already the source of benefit for whatever business transactions that you do. And as a sole proprietor, you would have already filed on your taxes, just like you would if you're a direct employee. So you're off the hook. It's the ones that have a formed, structured business, organized business, incorporated business. They're the ones they're going after. If you have multiple beneficial owners in your organization structure, let's say some might have like five beneficial owners, right? And each of them has 20% stake. You're going to need to contact each and every one of them to collect certain piece of information. Let's say their driver's license change. You're going to need to get a copy of the driver driver's license. It's required on the form for every beneficial owner. You got to get personal addresses. They want the personal address for each and every person on there. You're going to need the business address. You're going to get a lot of data. But it's not. It's not a long form, it's a simple form. It's just the principal. Once again, that's my beef, is the principle. It's not the data. The principle is all this information already exists out there. It's already part of the articles, organization, and other documentation filed with the state where the feds could easily go there if they needed to get the information, and they refused to, which is what pisses me off. So have I convinced you to reconsider being a small business? Please don't feel that way. I don't want to turn you off being a small business. It's work. But I do think it's the way to be free minus garbage like this. I think it's the way to be free of the saddles of what happens when you are an employee for another company where they're incompetent. I've worked for countless companies where seems like it's an endless stream of incompetence. That was one of the motivators for me to start the company in 2019 that I did and just kind of go with it because I couldn't deal with this incompetence over and over and over, you know, and as a contractor myself, you still work with companies where there's a level of incompetence. I deal with this on the personal side. I'm dealing with companies where they have an LLC and every last one of them does the same thing. You're trying to get some work done. Instead of sending me straight to Jill the technician, I got to talk to some girl who's clearly a front desk. Okay. Is your address and your phone number is deep to do. To do. And you're looking to do a deep dd. They're just reading off of a form that's a way waste of that person's time, and it's a waste of my time. Send my data straight to Joe the technician. Have Joe the technician call me and say I could be out there tomorrow. That's it. Quick, fast, nothing. I'm not going to talk to the girl at the front desk. It's just a waste of effort. So I understand the incompetence is all over the place. I'm not saying that it's a good or bad thing. I just recognize that's what it is and it frustrates me. And it might not frustrate you. I'm hopeful though that none of what I'm talking about discourages people that were strongly considering being a small business. You just have to understand, although there are pros, there are certainly cons. The pro is a better control over your money flow. That rhymes. The con is bottom line, you're dealing with incompetent people no matter what you do and with yourself, business, you're dealing with incompetent government. You're dealing with inept government. You get exposed to how government simply doesn't know what the f they're doing. They just do a bunch of stuff where you're asking the question, why can't you get this from the state? And it opens your eyes to the fact that the reason that they can't get it from the state is the state doesn't want to give it to them. The state would like to protect their citizens for good or good or bad. They'd rather protect their citizens from federal overreach. That's what they want to do. So one saving hope for this whole business is the theory that certain states might step up, attorneys general a and B might step together and say, we're suing the federal government. This is overreached to block this, just like what happened with Biden's student education plan.
[00:21:23] It's possible. I don't want to get your hopes up. I am telling you about it because chances are you're going to need to file this nonsense if you are a small business and or you're a beneficial owner of a small business, whether or not you know about it, I do think there's an obligation because it's possible they could do some legal action. I doubt it, but it is certainly possible. They talked about a dollar 500 fine. $500 fine. You know, I turner, you know, on this business, so, hey, small business man. Business ownership in general business ownership, it's a, it, it's enriching. But at the same time, you see so much silliness and stupidity and it just asks you the question. It's like, okay, now I understand why the country's gone down the tubes. It's because we do everything in our power to suppress small business. Yes. And then here's the thing. The exception to this whole thing is when you make over 5 million. So the large companies, they don't want nothing about it. Okay. Am I still tinfoil, right? Am I still crazy? Am I still out of my mind? You decide for yourself. But again, I don't want to dissuade you from being a small business. I'm just calling out these blatant things that they're doing where they're attacking now, small business owners and discouraging small business growth. I guarantee you it's going to hurt the country if you don't have support for small businesses. Because they're what keep the whole thing floating. Meanwhile, the large ones, they'll keep on crashing and burning to the point we might end up in another housing bubble here soon, thanks to all the loans and the, them lowering the requirements again and pushing home equity loans again.
[00:22:55] I'm.
[00:22:57] It's okay to call me tinfoil. I'm sharing it because it's important, because I may be the only one out right now, and I want to be ahead of it. And if I get it right, you come back, get my credit.
[00:27:21] You. Oh, who you all are close.
