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In DSP's recent hate live podcast he tells us about the problem the has been weighing him down. He discloses that It has to do with Washington state business taxes. The tax attorney he hired did not advise DSP on the necessity to register his income as a business and pay business taxes. Recently DSP has been claiming that what he does is NOT a business. However this contradicts what DSP has said in the past about everything being a business even saying that he wrote things off as business expenses. 

 

Now i'm not familiar with business tax protocols. Does writing something off as a business expense have to do with federal taxes or state taxes? This leads me to my next question. If DSP knew what he was doing was a business in the past then why haven't the Washington state business taxes been paid? Can anyone more knowledgeable on the subject weigh in? 

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5 minutes ago, bongo said:

In DSP's recent hate live podcast he tells us about the problem the has been weighing him down. He discloses that It has to do with Washington state business taxes. The tax attorney he hired did not advise DSP on the necessity to register his income as a business and pay business taxes. Recently DSP has been claiming that what he does is NOT a business. However this contradicts what DSP has said in the past about everything being a business even saying that he wrote things off as business expenses. 

 

Now i'm not familiar with business tax protocols. Does writing something off as a business expense have to do with federal taxes or state taxes? This leads me to my next question. If DSP knew what he was doing was a business in the past then why haven't the Washington state business taxes been paid? Can anyone more knowledgeable on the subject weigh in? 

I think the issue is it is a business but not officially registered. That's why he's in trouble right now. If it wasn't considered a business he wouldn't have to pay these taxes.

The reason the taxes weren't paid was explained in the video. The state simply wasn't aware of it until they got tipped off which put Phil under their radar.

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5 minutes ago, Nich2440 said:

I think the issue is it is a business but not officially registered. That's why he's in trouble right now. If it wasn't considered a business he wouldn't have to pay these taxes.

The reason the taxes weren't paid was explained in the video. The state simply wasn't aware of it until they got tipped off which put Phil under their radar.

Ahh okay that makes sense. Then it really is a good thing this happened sooner rather than later.

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Having had my own issues with the IRS over an internet retail business, the IRS is generally pretty lenient and willing to work with you.  It's not until you try to fuck them that they really come after you.  If he didn't register an LLC or at least a sole proprietorship, I guess the IRS can question why he's writing off internet, electricity, video games, and even food for videos.  The amount of stuff he can write off must be incredible, but it must have raised some red flags.

 

When I started my business, I got a business license from my local municipality.  Once it became more serious, I saw an accountant who told me to cancel the license and register as an LLC.  I'm guessing that last part is something he overlooked.  If that's the case, hopefully his tax attorney can help him register and resubmit his tax filings.  There may be some penalties and of course the attorney will cost a few thousand, but I think he'll be ok.  The IRS gets a bad rap, but they're more than willing to put someone on a multi-year payment plan.  They don't want to take your home, but they will if you duck them.

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I dunno much about taxes in the USA but what I found is that Phil can't write anything off in the state of Washington if it classifies as a real business but I doubt it does. It's probably self employment.

"What is the business and occupation (B&O) tax?

The state B&O tax is a gross receipts tax. It is measured on the value of products, gross proceeds of sale, or gross income of the business.

Washington, unlike many other states, does not have an income tax. Washington’s B&O tax is calculated on the gross income from activities. This means there are no deductions from the B&O tax for labor, materials, taxes, or other costs of doing business."

https://dor.wa.gov/find-taxes-rates/business-occupation-tax

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4 hours ago, shadowman said:

I dunno much about taxes in the USA but what I found is that Phil can't write anything off in the state of Washington if it classifies as a real business but I doubt it does. It's probably self employment.

"What is the business and occupation (B&O) tax?

The state B&O tax is a gross receipts tax. It is measured on the value of products, gross proceeds of sale, or gross income of the business.

Washington, unlike many other states, does not have an income tax. Washington’s B&O tax is calculated on the gross income from activities. This means there are no deductions from the B&O tax for labor, materials, taxes, or other costs of doing business."

https://dor.wa.gov/find-taxes-rates/business-occupation-tax

Hmmm I'm getting sort of lost in that.  Surely he can write off business expenses?  

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4 hours ago, FaultyAttourney said:

Phil said in one of the Hate Lives from earlier this year that he was writing certain things off as a business expense. If he was writing things off like the lights, games, accessories, and etc under "business expenses" while knowingly not having a registered business, thats called Tax Evasion. In any state. If his tax attorney allowed him to do such things than there should be no surprise why he wanted to wash his hands from this whole situation when this was brought to light.

Also i have no clue why Phil stuck with this Tax guy in CT... oh wait I know why.... probably because it was going to be very tough to find another tax attorney that would allow Phil to write things off under a business that doesnt exist. Thats the only thing that could explain sticking with an attorney 2,000 miles away in a completely different state. Phil even said he paid the guy $1,500 one year to get his taxes done, hes paying his new legit guy $800. Almost half the price and he's reachable. So what was the point of sticking with the CT guy other than what I mentioned above?

And another thing, getting this wierd mail since the beginning of the year to find out in August you've been investigated on? What is he doing about all this? Did he just sit on his hands and expect the fans will bail him out again? He didnt think to investigate why hes getting these heaping piles of mail with a business name that doesnt exist in his mailbox?

Another thing... Sell your $250,000 house for a $5,000 to $8,000 tax debt? Not that much when that stream he revealed all this made him a grand alone.

There is alot of things that contradict themselves which is not unusual in a DSP story, but one thing is for certain. DSP isnt totally blameless in all this. And before i get labeled a troll, i actually considered donating to DSP, but theres alot of holes in this situation where I couldnt peacefully donate if this is just one of Phil's fuck ups that he wont admit to creating.

Tax evasion is not what you think it is.  Tax evasion is knowingly and purposely concealing income from the IRS.  Failure to register as a legal entity is a big deal, no doubt, but you're acting like every person that misfiles gets thrown in jail lol.  He'll have an opportunity to refile and pay what I'm assuming would be backed self-employment tax, plus interest and penalties.  I hope he has his receipts though or he may have some trouble proving deductions from years ago.  

I'm not sure if he actually reads all of these forum posts, but get yourself a tax attorney that works with the IRS and can get you put on a payment plan.  Your regular accountant is probably not the best person for the job.  I had a separate person handle my filing mistakes, and while it was expensive (about $3,000), these people can negotiate on your behalf to have penalties abated.  You absolutely want one of these people to represent you.   The money they will save you more than pays their fee.

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I have no problem if he pushes his problems onto his fans, Phil shouldn't lose his house. I have a problem however if someone is greedy and makes up fairy tales. You sound butthurt that he has this house and you probably don't or whatever is your problem. He build this up from his 8 year legacy and also invested quite some money into his girlfriend which just left him at the end. The last thing DSP deserves is that he loses that house.

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I don't love the guy either, but I feel for him as a human being.  As someone who has gone through similar issues with the IRS, I just want to give him some advice.  I had an issue with online gross sales where I was only claiming the money actually transferred into my bank accounts.  As it happens, you have to even claim referral fees or advertising fees that come right off the top (meaning I never see that money but it is technically still earned income).  I had to hire a tax attorney (not my accountant) to represent me to the IRS and everything is fine now.  There was never any risk of me going to prison lol.  Some of you guys watch too much television. 

I'd be happy to answer any questions about this issue if anyone would like to pm me.  Th IRS is very reasonable if you demonstrate that you are willing to work with them.

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A-Logging is a term used to describe one expressing disproportionate levels of hatred for Phil, often including wishing him physical harm, usually for perceived "crimes" that Phil is "guilty" of. The people who do this are known as A-Logs, and are considered at the other end of the spectrum from white knights; where white knights try to defend Phil from trolls and help him to improve his situation, A-Logs hold the belief that Phil is deserving of whatever scorn and harm he is subjected to, and then some.

Petulant little narcissists.

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2 minutes ago, FaultyAttourney said:

He said specifically its up to his fans to bail him out, and this "looming problem isnt no longer just his but OURS too".

You seem like a logical person, but how Phil mismanages these situations all the time which always makes me question the validity of his debt. For instance, may lose his house, giant unknown tax bl coming in 2 months, dont really know the exact amount these tax fees will be... going on a week vacation next week.

Now everyone needs a vacation, but does that sound like someone who is financially strapped? Doesnt want to clean up Leannas play pen and maybe rent it out. Maybe sell some of the stuff she left. Sell that Playstation VR he used maybe 2 times and now collects dust. Sell the Xbox One he never uses.

Theres alot of things people in a financial crisis do, vacationing isnt one of them even if he he is just going to lay around in his house.

I don't disagree.  I don't generally post here much, but I wanted to share some of my own experiences with the IRS because I think it could be helpful.  Should he take a vacation if this is looming?  Unless something else is going on, this tax situation is going to end with him being put on a payment plan.  It's not the end of the world, but it is another burden he'll be forced to endure.  Generally state or federal tax agencies put you on a long term plan so that it doesn't impact your ability to run your business or to make your future payments, so I very much doubt they're going to put a lien on his home.

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5 hours ago, thatanonymouse said:

A-Logging is a term used to describe one expressing disproportionate levels of hatred for Phil, often including wishing him physical harm, usually for perceived "crimes" that Phil is "guilty" of. The people who do this are known as A-Logs, and are considered at the other end of the spectrum from white knights; where white knights try to defend Phil from trolls and help him to improve his situation, A-Logs hold the belief that Phil is deserving of whatever scorn and harm he is subjected to, and then some.

Petulant little narcissists.

Odd that you would just copy/paste it instead of simply typing something simple, such as "Someone who follows another person with the intent or wish for them to be harmed because they believe them deserving so. It is a pejorative." It makes it even weirder that you edited out CWC references from where you took it from and entered in Phil's name. 

https://sonichu.com/cwcki/A-Logging

Below is precisely the plagiarized source:

Spoiler

A-Logging is a term used to describe one expressing disproportionate levels of hatred for Chris, often including wishing him physical harm, usually for perceived "crimes" that Chris is "guilty" of. The people who do this are known as A-Logs, and are considered at the other end of the spectrum from white knights; where white knights try to defend Chris from trolls and help him to improve his situation, A-Logs hold the belief that Chris is deserving of whatever scorn and harm he is subjected to, and then some. A-Logs are sometimes interchangeably referred to as weens, as many A-Logs also tend to be weens and vice-versa, although weening has a different meaning to A-Logging, namely unfunny or failed attempts at trolling Chris. While once fashionable, A-Logging has become associated with people trying to "trollshield" themselves, like the original A-Log, and therefore is looked down upon by Christorians.

 

14 hours ago, Rufus said:

Hmmm I'm getting sort of lost in that.  Surely he can write off business expenses?  

As a certified public accountant who does tax for several small and medium size businesses in WA I can attest that you can, the reason most are having a difficulty finding it is because they're using the layman's term "writeoff". It's called a deduction.
That said you cannot make business deductions without a business.
https://dor.wa.gov/find-taxes-rates/tax-incentives/deductions

Also there's a difference between a retainer (the $800 spent on the new tax attorney) and the fees for actually filing your taxes. You retain to make sure they calculate you in as a time need when taking on customers, but you pay to have them do it. Think of it as paying to reserve a table at a restaurant vs walking into a McD's unannounced (HR Block/Jackson Hewitt) vs making a tv dinner (self filing).

From the sound of it, he paid the guy to do his taxes but the guy was happy to get an extra $1k every year what amounted to simple work that he would very unlikely ever be audited for. It was free money, and Phil was used. 

On the topic of things discussed, when you sign your property over to a rental management agency they assess the risks and liability for the property while they rent it out. That is the precise reason they exist, not because you can't find people to move in, any joe could log into Craigslist and post an ad. It's because actually attending to the property in that time is costly either via time or money, so rather than you do it or take on the risk they do it and in effect sublease. Think of it as you renting to them and they rent to someone else. They give you a cut of their take not the other way around of you having a piece of your take removed by them.

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21 hours ago, SarynPrime said:

That said you cannot make business deductions without a business.
https://dor.wa.gov/find-taxes-rates/tax-incentives/deductions

You're looking at Washington state regulations, which don't apply to my Federal taxes, against which I always did the deductions/write-offs and yes, you can do them and be considered self-employed, and NOT the owner of a business. As I clearly stated, I never filed taxes in the state of Washington before because my previous tax attorney (who is a CPA, mind you, with 30 years of experience) advised me I didn't need to. He was wrong, because he was lazy and didn't look up that there is a requirement to register as a business in the state of Washington and pay the Business Occupation tax.

You're also wrong on the retainer part. A retainer is a set amount of money you pay to an attorney to retain their services. However, that money is a budget from which you can withdraw for services rendered. They don't get to just pocket that money; it's considered an up-front pre-payment for services to be rendered in the future. That way, if for some reason you back out of working with that attorney, they at least make the $800 profit; but if you stay with that attorney, they will at first take funds out of that retainer to pay for services rendered until it is depleted, until it is, and then they will begin to invoice for further work that was performed. It literally has nothing to do with "reserving a table" at all, and your analogy is flawed.

Lastly, you're wrong about my previous tax attorney just "doing simple work and using Phil for free money." He got me a crazy amount of tax deductions over the years, including for my home office, equipment, health care costs, travel and more. I never would have known about those without him, and it's incredibly doubtful that someone at H&R Block/Jackson Hewitt would have either. Or at least, they wouldn't have done them properly. Until he got lazy and screwed up the Washington Business tax situation, his help was incredibly useful.

However, it's obvious you're not a tax attorney at all, since you don't even understand simple concepts. Goodbye!

 

 

 

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2 hours ago, Phil said:

You're looking at Washington state regulations, which don't apply to my Federal taxes, against which I always did the deductions/write-offs and yes, you can do them and be considered self-employed, and NOT the owner of a business. As I clearly stated, I never filed taxes in the state of Washington before because my previous tax attorney (who is a CPA, mind you, with 30 years of experience) advised me I didn't need to. He was wrong, because he was lazy and didn't look up that there is a requirement to register as a business in the state of Washington and pay the Business Occupation tax.

You're also wrong on the retainer part. A retainer is a set amount of money you pay to an attorney to retain their services. However, that money is a budget from which you can withdraw for services rendered. They don't get to just pocket that money; it's considered an up-front pre-payment for services to be rendered in the future. That way, if for some reason you back out of working with that attorney, they at least make the $800 profit; but if you stay with that attorney, they will at first take funds out of that retainer to pay for services rendered until it is depleted, until it is, and then they will begin to invoice for further work that was performed. It literally has nothing to do with "reserving a table" at all, and your analogy is flawed.

Lastly, you're wrong about my previous tax attorney just "doing simple work and using Phil for free money." He got me a crazy amount of tax deductions over the years, including for my home office, equipment, health care costs, travel and more. I never would have known about those without him, and it's incredibly doubtful that someone at H&R Block/Jackson Hewitt would have either. Or at least, they wouldn't have done them properly. Until he got lazy and screwed up the Washington Business tax situation, his help was incredibly useful.

However, it's obvious you're not a tax attorney at all, since you don't even understand simple concepts. Goodbye!

 

 

 

I don't quite understand. Are you in this tax bind because you didn't report your earnings as a business because you thought you were self employed and didn't have to? Or is it because your attorney didn't tell you to register as a business and file for your earnings?

It is kind of surprising that this educated tax attorney didn't tell you this despite the information being so easily accessible through a simple Google search. That attorney must be incompetent. 

Edited by bongo
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18 minutes ago, Luckyfall said:

Or he thought he could make some easy money with no repercussions knowing Phil can't really do anything since he's in another state. He's a scumbag. That's one thing i'm sure people can agree on.

I don't know much about taxes, but I do know its generally a bad idea to get your taxes done with a tax man thats out of your resident state!! I understand the Conneticut tax man gave Phil HUGE deductions over the years so he probably want to stick with him. But look at this giant mistake that he has to pay for that makes all those deductions MEANINGLESS since he didnt save the money!!

Now the fans have to come out of pocket just for Phil to stay on-air!!

 I wonder what position Phil would be in if he saved all that money and not moved across country?:ohmy:

Seems like moving across country was the worst thing he could of ever done!:sleep:

Edited by GreasyPickle
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1 hour ago, Luckyfall said:

Or he thought he could make some easy money with no repercussions knowing Phil can't really do anything since he's in another state. He's a scumbag. That's one thing i'm sure people can agree on.

If that's the case then he should definitely try and sue this guy. Phil should give us his name and agency so we can at least see how he is operating. It's not fair to us fans to simply give Phil money and bail him out for another's mistake. 

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23 minutes ago, bongo said:

If that's the case then he should definitely try and sue this guy. Phil should give us his name and agency so we can at least see how he is operating. It's not fair to us fans to simply give Phil money and bail him out for another's mistake. 

You're saying this with zero understanding of how anything works in the real world. To sue anyone would take hundreds of hours of time and effort, and THOUSANDS of dollars to even get a lawyer and file a lawsuit. Then you have to go to court that can potentially take years to get your case heard....to sue someone across the country from where I am, which means I'd have to fly over there, possibly repeatedly. For what? MAYBE a couple thousand in interest/fees that I now owe because the guy didn't do due diligence? And even though I have e-mails where the attorney blatantly tells me "I can still be your tax attorney, do not get another one in Washington" I'm sure there will be some BS argument to try and get him out of it.

It would be one thing if I owned $50k in back taxes, and the fees/interest were like $30k. THEN it would be worth it. But for this small amount, it very much isn't.

Also, if you think PUBLICLY RELEASING the guy's info would be beneficial, you are retarded. In fact, it's obvious this entire thread is a poor troll's attempt to stir up trouble. So, goodbye!

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