Each tax year stands alone. Additionally, corporate income tax filing are due on March 15th, but many companies that owe money will file an extension until September 15th. Owner draws from an LLC are tricky. For a "C" Corp, they must either be reported as personal income (with accompanying 941 income taxes withheld) or treated as a dividend or loan from the company. In the case of a loan from the company, whatever loan amounts were taken out by a stockholder, must be reported as corporate income. This is the worse case scenario for most small businesses because corporate taxes are generally going to be much higher than personal income taxes. An LLC (Like IMR/CGL) is a "pass through" corporation wherein the profits automatically flow to the stockholders. I'm not sure how an owner's draw would affect this. As has been previously mentioned by others, I can't imagine a scenario where fellow stockholders would allow another owner to take a draw without paying it out in the same tax year. At any rate, according to the chart, it appears that most of the owners draws (in monetary value, not necessarily quantity) took place in 2009. If that is indeed the case, (and if any of this is factual at all) IMR/CGL could still correct any potential IRS problems if Loren L Coleman is able to repay the money before September 15th. There are a variety of ways this could be done. The simplest and cleanest is to dramatically increase Loren L Coleman's (and/or Heather's - there's further tax gamesmanship that can be accomplished when your spouse is also an employee) salary dramatically until he is able to repay the owner's draws to the company. To make up for the resulting loss of LLC "pass through" income to the remaining shareholders is not as simple. But, it beats an audit you're likely to enjoy the results of. (Again assuming the factualness of the graph that has been posted).

Actually, there were/are claims that in addition to that money in these graphs there was income made at conventions which did not get declared to the IMR/CGL at all.
Thus it did probably not go to the Beancounters. Thus it did probably not get considered for the tax declaration.

I'm not really sure we can say that with certainty. What we can say for certain is that Loren Coleman had the ability to withdraw money from an IMR account. I don't think I've heard it said that the IMR account was literally Loren Coleman's personal account.

I think there's already a thread going about Troll Faces

"You don't want to lie to me right? Not if i could break you in two pieces using only one hand?"

Nah, he'd be an informer NPC.

Individual owner's draws are not a good thing for an LLC partnership. Because of this:

If the LLC is a partnership, it should file a Form 1065, U.S. Return of Partnership Income. Each owner should show their pro-rata share of partnership income (reduced by any tax the partnership paid on the income), credits and deductions on Schedule K-1 (1065), Partner’s Share of Income, Deductions, Credits, etc.

Income should be reported as regular W-2 income (with accompanying 941 taxes on the corporate side), 1099 income, or distributed pro-rata to the partners/shareholders. Hey, I didn't think of that. That might be away for the co-owners to recoup their financial position. They could report all of the owners draws as 1099 (contractor) income to Loren L Coleman and let him bear the tax liability. (The same could be true for the alleged non-reporting of convention cash sales.)

EDIT: Of course this still doesn't take into account the lost income in 2008 and 2009. I'm not quite sure how Loren L Coleman could make up for that without increase the tax liability of the other owners. Hmm.....

As part of my normal head-poking-in, I'd just like to say that statements about matters such as tax liability have the most credibility when they come from lawyers and CPAs who have looked into CGLs books (a group that, last I checked, had not proclaimed doom). Other statements invariably come with different degrees of credibility.

Jason H.

I am pretty much Incredible.
*runs for his life*

That was a terrible pun

/wideburst at Stahl

As part of my head-poking-in, I'd just like to say that a question I posted to ketjak confirmed that those are indeed the graphs in question.

Fair enough. Can you comment on the graph that's been posted elsewhere regarding CGL's owners draws? [EDIT: and have been confirmed by a co-owner.] It's perfectly reasonable that you are not authorized to comment, but it gets back to that PR battle: Party A says Party B kicks puppies and eat's babies. Party B says trust me, everything's going to be okay, please don't speculate. Invariably, until someone comes forward with facts there will be speculation. Almost as frequently, more leaks will continue to occur as we've seen today. Not bashing you, you've been placed in an impossible position. It's very difficult to walk the middle ground of comment without disclosure. Party A appears to be correct because they're coming forward with new information. (Well, unless Party A can't help but insult everyone around them, but that's a different discussion.)

Well damn, that feeling seems to have been the floor dropping out. The thing that gets me about this whole mess is the sheer number of additional levels we seem to be encountering...

Honestly, I can't comment on the graphs. Looking into the books is not part of my job, and that's not information I have.

Jason H.

Wow! That's a dramatic graph. And it's pretty much Frank Trollman's original estimates, too.

K.

i am so sorry, i just could not help myself ^^

And the people who had looking at the books in their jobs quitting is, of course, not a big help in this case either.

Kinda makes one wonder just what kind of inside sources Frank has eh?
Ketjak would not give us those Graphs, so he is probably not it.

Quick clarification: Jennifer was the bookkeeper, but there are also outside personnel, such as CPAs and lawyers, who review material. I don't believe Jennifer is a CPA (she can correct me if I'm wrong), so she could not perform CPA duties.

Jason H.

Ah, okay, good to know.

Looking back I see that it was never stated either way. I took the 'co-mingling of funds' to imply this.

The chart numbers and how they progressed made me think of this...

http://www.icv2.com/articles/news/17234.html

Both would be a case of no one minding the store.

Hey! Finally something I am qualified to comment on! As a small business owner ("C" corp, my state has special tax laws for LLCs & S Corps) with a bookkeeper and an accountant (and evidently too much time/not enough ambition or I wouldn't be on here...) I can tell you that a CPA is there to help protect you from tax liability. Most CPAs audit and file corporate reports and taxes based on the books that the bookkeeper maintains. So, while Tiger Eyes may not be as much of an expert as a CPA (unless, as JM Hardy pointed out, she is in fact a CPA) she is very likely to be more of an expert on her specific employer's books than the CPA is. In other words, the bookkeeper literally keeps the books and then provides them to the CPA who audits them and then files the taxes. The CPA would generally ask the bookkeeper and principle owners about any discrepancies found in the audit and then discuss tax strategies with the principle owners.

Now, I personally, don't know any of the individuals involved or even if there really is a JM Hardy or Tiger Eyes and this isn't all a construct of the ADAM AI, but if Tiger Eyes was the bookkeeper, and whether or not she is a CPA, she is the most capable person of speaking to the financial goings on at the company she was employed at while she was employed there as bookkeeper. Something, by the way, I don't believe she has done publicly yet, so maybe it would be best if we leave her out of it and allow her to speak for herself.

[EDIT: that last line came out harsher than intended. I'm sure everyone quoting Tiger Eyes wishes her nothing but the best. It's interesting how knowing that there's a single mother effected brings out the protective instinct in us. You're alright Dumpshockers.]

It's also my understanding that she actually took the bookkeeper job shortly before the review started, which would have been after the questionable draws. I believe this was stated earlier in the threads. I'm repeating it here for the benefit of people who are newer to the thread.

I think it's an important point to make since this whole thing involves activity of which the bookkeeper would have or should have been aware. She wasn't the bookkeeper at the time those draws were made.

We try to look out for our own.
And she is one of us.

I know this sort of silly creeps in occasionally and we all need a bit of stress relief -- but let me assure everyone that even if Catalyst pulls through, the hardships that people who have left/been fired are real.

As I've said before ... I'd rather be busy doing 'real' work making something or making something better, than dealing with press releases or negotiations or any of that stuff. (Which is one of the reasons why Posthuman is open and honest -- it's EASIER)

(Currently on hold with the airline as my flight was cancelled due to an airport-and-city-wide power outage today. awesome!)

Well, of course.
Everybody would like to simply do his job / what he likes.
NOBODY wants to deal with organizing/bureaucratics and the such . .
Well, aside from those who like that sort of stuff or who have made it their job.
And even those moan about it from time to time. It's why i refuse to let the corp promote me.
I am a tech head, i help people with technical problems. I don't deal well with organizing stuff <.<

So if I recap, Jen was hired has book keeper AFTER the L.Coleman did his "larcin" ?
So when she was confronted to the said "larcin" she decided to quit. And it is legitimate from her value system. I would have done the same.

I would have pointed that fact to the authorities and to the owner of the licences ... but that's just me being a part of the male anatomy.
I really think that she doesn't want to speak about it because she didn't talk about it yet.

Frank Trollman is on a crusade. He wants CGL down so he will paint them has the devil. He also paint himself in the corner for many fans. I am one of them that just think he should stop talking. He did his part of the butterfly effect and he should wait for the tsunami to happen.

I just hope everything settle.

Know what, I have to agree with you.
I am a cook, I cook for people with hungry tummies. But I have to deal with organization all day and if everything would work like a kitchen it would be great !

The silliness was ill advised. I'm sorry. I was trying to get in front of any criticism of the fact that I, like the vast majority of Dumpshock, do not know any of the current/former freelancers/employees in "real life" and cannot speak first hand to the validity of anything that has been said here by anyone. Some have argued that we should not speculate because we don't know the facts, and then themselves pleaded ignorance of the relevant facts. It's confusing. And my confusion is exacerbated because Trollman is the only one quoting facts and figures. There is doubtlessly another side, but it's a side that I haven't heard yet. At any rate, the point was not to make light of your hardships. It was an ill chosen metaphor. If anything, please take your deusification [sic] as complement.

I think this came up briefly earlier, but if there are Shadowrun creative minds who are in a place of need, there are a lot of generous folks here. If any are in the DeeCee area, give me a holler and we can, at minimum, bring over some meals, provide babysitting, and so on. I know people aren't eager to ask for charity, but speaking for myself, I owe some people some lunches.

Loren L. Coleman. The "L." may be silent, but it should be printed lest the cryptozoologist see more fallout.

Those are the graphs I made, or copies of the images I sent to the owners, at any rate. I had hopes I'd be contacted via PM before they were posted, but no such luck.

I would use a three-act structure for the adventure/campaign that requires different Johnsons:

I: The harvesting (time leading up to discovery - concealment ops, mostly)
II: The discovery (collecting information and data)
III: The fallout or recovery (that's up to the writer)

- Ket

Full Disclosure:

For three years during the 90's I worked as an auditor for the Federal Reserve. I'd rather not say which branch right now. Part of my duties was ensuring that financial institutions were not laundering money, so I have some experience in looking into "less than above board" dealings.


Now, go back and reread some of my posts.


Begin speculation:

Given the charts, and the recent statements, and if they are true... someone would be very interested in finding out more details.

As has been speculated, there are ways the LLC could protect itself. The 1099 route is actually very common - it hurts the "bad member" but protects the rest of the LLC. There are other perfectly legal methods that can allow the LLC to survive, allow people to avoid jail, and, if the business continues, allow for everyone to go back to making money. The "bad member" usually loses far more money than they "borrowed" in the whole mess, but at least the business keeps going (which is the point).

Frank's speculation that CGL closes immediately is wrong, it would take almost a year for the Government to shut Catalyst down, and that clock begins only if they decided to prosecute, which can only happen after an audit, which can only happen after they file returns. You're looking at 18 months to 2 years of life to fix things.

As a general set of conclusions:

• I still don't see Loren L Colman going to jail, unless he makes a mess of his personal taxes.
• I don't see CGL going out of business, unless TOPPS yanks the license.
  If TOPPS has been shown:
  
  • all of the books
  • shown an operating plan forward
  • shown that proper controls are now in place
  they would most likely keep the license with CGL as opposed to running the risk of losing all of the work done to date.

A white knight, such as a Posthuman with a notable like Tom Dowd working with them might be more attractive from a continuity standpoint, and that type of entity might have a shot, but otherwise, if CGL has fixed the problems, then I would guess that TOPPS lets them keep the license.

-M&P

I don't get all the hate for Frank Trollman in these threads or people who say he should shut up. He's consistently posted interesting information which has frequently turned out to be accurate. In return, poster after poster has had a go and I genuinely don't see why. What matters about a post is whether or not it is right, but people were very seldom having a go at him for being wrong. Which leaves me at a loss as to what they were having a go at him for.

K.

I read Dumpshock long before I signed up or started posting. In that time Frank has always come across to me as some sort of magnificent bastard. I don't always agree with him, but that doesn't matter as he tends to have his facts straight. We definitely disagree on many points of opinion though, but tuning those bits out are easy enough. He's polarizing and that tends to lead to folks taking shots.

I'd guess its that FT's motives are peculiar, at least to me. His vitriol always amused me because displaying so much hostility towards contributers to these boards and to the game seemed a little misplaced, since Shadowrun is just a game.

The situation with CGL is not a game but his tone is the same. He draws the worse conclusions from his facts. The post above yours is also based on facts but draws a different conclusion. I don't know dick about Trollman, but from his posts I've drawn conclusions about FT as a person, and I just don't like him.

Because frequently his posts are accompanied by commentary or content that comes off as positively salivating at the idea of CGL collapsing. There was also a brief dustup earlier that came from derisive comments he made about one of the other CGL owners and religion in general.

And when you say accurate, his numbers are ballpark accurate. His original claim from 'reliable sources' was $850,000, which is off by more than 10% from the more recent numbers given. He also asserted that freelancer demands (payment) will not be met, but some money has started going to freelancers.

The question of who has given him information and what their intentions are has also been an issue. Is it a current CGL employee who is violating some sort of employment contract? Are the numbers accurate, or are the inflating or conflating information to make things sound worse than they are?

There was also the fine example of Frank pointing out that he doesn't post unverified rumors, followed by a list of rumors that he himself said he could not yet verify.

Knasser,

It's because the truth tends to get some people's panties in a bind. Frank happens to be a bit (lol) abrasive while doing his thing. As such, people who are upset by such things tend to get very unhappy very quickly.

The problem as I see it, all too often it's an emotional arguement and those with the raging emotions **REALLY** hate it when people come to the party with facts. Facts don't lie. Facts don't spin a story. They are what they are and they are really good at refuting bullshit. Those using an emotional arguement CANNOT fight against facts. They can but impotently rage against them and the messenger.

As such, those folks attack Frank and egg him into making a move that violates TOS and gets banned.

Having worked as a forum admin on other forums in the past, I've seen such behavior from the so-called 'good guys' of the forum.

It is what it is however unfair it may be.

What a lot of people fail to understand is that while you may have the freedom of speech, you do NOT have the freedom to NOT be offended. You can however always ignore the offending person.

(NOTE: the 'you' in this sense is not you uspecifically Knasser, but the generic 'you', the reader.)

*looks at the charts. Shakes head and is a bit sickly amused*

So.... I've read the last few pages... let me see if I am hearing this right.

We're looking at these graphs and ... the dramatic change in taking out of money. And..... from what I've read.... that they can cover his ass, by merely "Jacking up" His salary to absurd levels.

Like... if he got 40k a year salary.. and they increase it to 200K.....

And if he only 'RECEIVES' 40K of the 200K.... that the 160K is considered 'paid back' to the company, tax wise.... and he's going to get away with stealin' over half a million bucks?

Am I reading that right? That's what I've picked up from it...



~~~



*looks at the charts again* They can tap dance all they want to. But anyone with a lick of common sense can look at that and go 'Wow. what a frakin' Thief!!'

I'm no lawyer. I"m no Tax man. And I defer to those that are..

*Taps charts* That's theft.... you can call it what you like. You can hide it and dance around it... that guy's a theif. He should go to jail.

I've no reason to doubt other posters that say he can hide it though various tricks of book keeping and what not.. I doubt he will go to jail.. but he still stole over $500,000 and if the charts are correct, over $700,000

That's what he did.... that's who he is... That's a scumbag right there.

Please be accurate and fully disclose the circumstances.

He clearly indicated that he heard of those rumors, clearly stated as far as he was concerned they were still rumors, and that he was unable to verify them as anything other than such.

That was in response to a query asked of him about things he had heard but had not been able to verify.

You'll also note that he did not continue talking about them (unless he posted someplace that I did not see).

So... care to explain why it appears you are trying to villify him for being honest?

Braces for thread #6.

This is nice, but Franks posts are frequently filled with facts and spin. And the facts are usually not verifiable by anyone else at the time, leaving us to figure which is which.

We only just got some outside confirmation of a number that even comes close to his original assertion of $850,000.

I don't have a problem with Frank. This is a message board; it's not a perfect medium.

At the end of the day, I want everything to just work out for everyone involved in this chaos. I want CGL to do the right thing: come clean, pay their freelancers, and continue to put out good products. I want those that left CGL to have prosperous lives.

Sure, there has been some ill will and emotion off and on in this super huge thread. But, I think, we all want Shadowrun to continue. We just go about expressing ourselves in different ways.

IIRC, he went on to split the $850k total into two figures (+/- $100k and +/-750k). Both appear to be quite accurate, and well within an acceptable margin of error.

While I applaud your ability to think like a shadowrunner, for the sake of accuracy (heh) I do not believe there has been any indication that CGL is actually going to try and cover Loren's ass in that particular way.

http://forums.dumpshock.com/index.php?show...st&p=907135




It comes off as Frank trying to claim the high road while posting incredibly inflammatory and by his own words unsubstantiated rumors.

If he really wanted to take the high road, he could have made that statement without those rumors.

He's engaging in the same sort of spin that he accuses Randall of doing, just in the opposite direction.

you know, i think i just figured something out.
If they were to cover his ass like this, they would look like a party/accomplice to this all . .
Now if they simply were to FORGIVE him for what he did . . well, THEY were the ones who lost money, HE made the mistake of not paying taxes for this money right?
Basically, IMR/CGL would stand there like the good natured victim who forgives the thief and the thief would be more or less getting what's coming for him right?

Tell me i'm just too paranoid and that can't really be right?

Are you talking about his original post?





Since the ~$750,000 number has come to light he's backtracked and said "Oh, I guess the $850,000 is the $750,000 plus $100,000 of convention sales". So his original assertion is that the total number was in the range of $950,000. And we don't have an verification of that additional $100,000 claimed yet.

I wasn't trying to be funny. A page or two back someone suggested that since it's drawn from the common pot, the way to 'recoup' the money would be to increase his salary astronomically and let him 'pay it back'

Well if you go from (( Just an example)) $40,000 a year to $200,000 a year..

If they HAND you the $200,000 you CAN pay back $160,000.

That's what I picked up from the previous post of how they can 'cover' the blatant out right theft.

That's why I was asking for conformation that I was reading it right.

I'm sure if you convert it to Canadian dollars that it all works out. Let's not nitpick. He cannot defend himself on here now.

If they go the 1099 route there would be significant tax liability for Loren L Coleman, but it sounds like I should really defer to Mind&Pen on those issues.

What I can point out is that if Loren L Coleman stole all that money and IMR/GCL loses the BT/SR license they are in a much worse position than if Loren L Coleman stole all that money and IMR/CGL retains the BT/SR license and it's related earnings potential.

Is there any point in this quibbling over Frank? I mean honestly? He clearly stated what were facts and what were not. You obviously have some sort of hard-on for taking shots at him for posting said information. You do not ~know~ how he came to his figure, so please do not "show work" in his stead, he can do that himself on other forums if people want to call him out.

if you can manage to register, ask him here:
http://tgdmb.com/viewtopic.php?t=50989&start=200
i tried two times, both failed because i get an error 111 could not connect to SMTP server, connection refused or something.