bc
Guest
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 Posted:
Fri Nov 11, 2005 9:00 am Post subject:
Securities Salespersons |
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We are trying to work with a group of registered securities
salespersons. They have been told
a) they may not form an entity of any type for their
commission income due to the language of the Exchange Act of
1934 which prohibits commission payments to other than an
individual unless the recipient is a registered
broker-dealer with the corresponding capital reserve
requirements.
b) they must be on a W-2 due to control issues.
These persons have significant expenses related to their
activities, which include autos, meals and entertainment,
travel, home offices, etc. Between the 2% limitation and
AMT, those deductions aren't worth much.
We have brainstormed for a structure which would give value
to those expenses, and have come up empty. What is anyone
else doing, recommending, seeing?
The closest we came to a working solution was classification
as a statutory employee. However, they aren't full time life
insurance sales persons. If something similar could be
worked out, they would likely be very happy campers (as
would we due to the new clients we would get).
--
Bruce Davidson Cantor, CPA, JD
Admitted in Colorado
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