Math Experts Needed

[GWCGWC 83]

Oh hi.I'd like to formally ask to buy 1% of your ME action but none of the prelims please. I mean, if you're gonna be selling shares.

[HoosierAlum 0]

TJ if you wanted to do it as a package deal and had for example 30k in total buyins here is what you would sell shares for:At 1.2:1 each 1% share would cost the backer $360. This would get them 1% of your total cashes of the tournaments you had listed. If you wanted to do it for individual tourneys you just use the same math.As for taxes, that is something you include in your initial agreement w/the backers. Make sure they understand that they will incur their share of taxes depending on what % they bought. Also, this type of backing deal definitely shouldn't include any expenses. Some long-term backing deals that involve make-up might somehow factor in travel expenses, but they are your responsibility in a "selling pieces" deal like this.

[Balloon guy 158]

not sure if anyone's mentioned it, but you also have to consider any taxes that you'll pay on winnings.edit: I actually ment to post that as a question, since I really don't have a clue.

PM Eric RylandHe figured this all out once before

[Balloon guy 158]

TJ if you wanted to do it as a package deal and had for example 30k in total buyins here is what you would sell shares for:At 1.2:1 each 1% share would cost the backer $360. This would get them 1% of your total cashes of the tournaments you had listed. If you wanted to do it for individual tourneys you just use the same math.As for taxes, that is something you include in your initial agreement w/the backers. Make sure they understand that they will incur their share of taxes depending on what % they bought. Also, this type of backing deal definitely shouldn't include any expenses. Some long-term backing deals that involve make-up might somehow factor in travel expenses, but they are your responsibility in a "selling pieces" deal like this.

Not to add any math to this, but what happens should TJ go very deep in an event, resulting in his missing out on another event, or should he grow tired and just need to skip one, or pull a Vinnie Vihn?Just add the total buy in's AFTER every event he actually played and recalculate the actual 1.2:1 price and refund diff?

[HoosierAlum 0]

Not to add any math to this, but what happens should TJ go very deep in an event, resulting in his missing out on another event, or should he grow tired and just need to skip one, or pull a Vinnie Vihn?Just add the total buy in's AFTER every event he actually played and recalculate the actual 1.2:1 price and refund diff?

Yea that would be easiest/best I think.

[DCJ001 0]

I'm pretty sure that if you document the backing arrangement and keep documentation of the money changing hands, the tax burden is passed on with the cash. ie you wouldn't have to declare it as income, but the backer would.Just FYI, I am a CPA, so I do know a bit about taxes, but that is not the area I work in, so I'm no expert.

True. But it's a good idea to have documentation to back yourself up. I have no experience with this but issuing 1099's to backers makes sense. There's also this IRS form:http://www.onlinepokerfaq.com/guide/tax-sharing.htmlYou may want to check with a tax advisor before any deals are made to ensure that it's all done right so you don't hae a Jamie Gold fiasco.

[KentuckySlim 0]

True. But it's a good idea to have documentation to back yourself up. I have no experience with this but issuing 1099's to backers makes sense. There's also this IRS form:http://www.onlinepokerfaq.com/guide/tax-sharing.htmlYou may want to check with a tax advisor before any deals are made to ensure that it's all done right so you don't hae a Jamie Gold fiasco.

OK. I did some investigating. First off, and let me make this very clear, you ABSOLUTELY need to get documentation of this backing arrangement. Something with a real signature would be best, I would think.So, here's the deal: It looks like to me (and I'm not 100% sure) that you're in the clear if the PROFIT from a given tournament is less than 5k. It looks like no withholdings will be held, but it would be reported to the IRS I believe. It would be up to EACH individual to report their gambling winnings from this cash. TJ - you would report only your profit from the tournament as gambling income, which is why you would need to keep documentation of backers (including documentation of payment made to them).Now, for cashes above 5k PROFIT, it looks like the casino could (and would be required to if asked, I believe) fill out a w-2g form for each person involved in the transaction. The casino would then cut a check to each individual for 75% of their share (with the other 25% being withheld for taxes). Clearly this is a giant pain in the ass, but would probably be best for huge cashes.For cashes above 5k that aren't terribly massive, it would probably be best to just eat the taxes upfront, but only declare your % as income at y/e. You could send in a smaller quarterly payment for the 3rd quarter to help alleviate the burden. Again, a big pain in the ass, but it always is with tax stuff...Hope this helps.Any U.S. tax advice contained in the body of this post was not intended or written to be used, and cannot be used, by the reader for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

[jethrodull 0]

TJ if you wanted to do it as a package deal and had for example 30k in total buyins here is what you would sell shares for:At 1.2:1 each 1% share would cost the backer $360. This would get them 1% of your total cashes of the tournaments you had listed. If you wanted to do it for individual tourneys you just use the same math.As for taxes, that is something you include in your initial agreement w/the backers. Make sure they understand that they will incur their share of taxes depending on what % they bought. Also, this type of backing deal definitely shouldn't include any expenses. Some long-term backing deals that involve make-up might somehow factor in travel expenses, but they are your responsibility in a "selling pieces" deal like this.

trying to understand this one - so 100 people each buy in for 1% of TJ. he has acquired $36k to put towards $30k of buyins. what happens to the other $6k? and when he cashes anything, he owes 100% to his backers, what does TJ get?J

[GWCGWC 83]

Oh hi.I'd like to formally ask to buy 1% of your ME action but none of the prelims please. I mean, if you're gonna be selling shares.

squeaky wheel

[GWCGWC 83]

Oh hi.I'd like to formally ask to buy 1% of your ME action but none of the prelims please. I mean, if you're gonna be selling shares.

[WhatArunAA 0]

if/ when i do it ill make a formal post:)

[Potomophobia 17]

You do not need a math expert.I have been observing quietly from the sidelines. All I have to say is: keep doing what you are doing.nuff said

[bigcoled 1]

This whole concept works on the basis that you have enough willing stakers, as well as your ability (not poker but physical) to play in all those tournaments with considered time constraints, as well as mental wear. But i think your best bet, and what would work out best for you is to do it by tournament. 1. It's easier to manage 2. Stakers do not have to stake you in a tournament they dont like your odds in as much. With the appropriate number of willing stakers you should be able to go to even 100 dollar shares... and work it from there, if you would like me to I would create an excel spreadsheet with pages for each tournament for you and send it to you.....

[Big Jono 0]

I am so in for this, will be buying atleast one share.ps Assuming you are going to offer them on here, which would be cool

[mr_druid 0]

I'm down for buying a few shares, and i'm in MKE so I can get you the cash easy.Tom.