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Mistakes You Should Never Make

sethbannon.com

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Re: Mistakes You Should Never Make

#341

Post by mikeash »

wpietri wrote: post #129
x0x0 wrote: post #89

Earlier quoted context omitted.

The logic here appears to be that since the employee is deemed to have paid the government on the day that an employee receives his or her paycheck, the employer is holding those funds in a trust for the government, to be remitted quarterly. The government appears to believe in Monteiro's strategy: "Fuck you, pay me." So you -- as an officer, an employee who pays bills, possibly a board member, or possibly other rela…

Weirdly, I feel for the IRS here. Early on in the days of the Internet, I would actually call up spammers and try to help them understand why they should stop. 80% of the people were confused small businesspeople who were glad somebody gave them the straight scoop. 20% were weasels who would say or do anything as long as it got them what they wanted. After a few decades of bullshit excuses from irredeemable idiots, I…

I can't see how failing to pay hundreds of thousands of dollars in taxes because you can't be arsed to make the basic comparison of "what am I paying" with "what am I supposed to be paying" can be described as a "reasonable mistake".

Re: Mistakes You Should Never Make

#342

Post by mikeash »

swombat wrote: post #154
tptacek wrote: post #146

Earlier quoted context omitted.

I've never had an unpleasant interaction with the IRS. Unlike virtually any other creditor I've ever dealt with, the people I've talked to who actually work for the IRS have been courteous and helpful. I'm not the only person who's said this. The IRS has acquired a personalized reputation for being jerks, not unlike that of Customs, but which totally doesn't square with how the agency actually acts. I say this as som…

Well, that's good to hear! This reputation the IRS has makes me worried about the idea of some day operating in the US. It's good to know that they actually employ human beings rather than attack dogs. From what you describe, they sound much like HMRC. And yes, withholding payroll tax (or VAT) and not passing it on to the government is pretty crappy. HMRC is typically understanding if this is a few months or even a y…

I get the impression (and I could be woefully wrong) that the IRS, kind of like the USPS, has an awful reputation that was justified some decades ago, has turned it around because of that awful reputation, but inertia means the reputation persists long after the underlying reasons have been remedied.

Re: Mistakes You Should Never Make

#343

Post by mikeash »

jasonwocky wrote: post #285
tptacek wrote: post #153

Earlier quoted context omitted.

It's taxed as regular income, but the premise under which it's exempt from the payroll taxes every other worker has to pay is that it's not normal income, but rather the return from an investment in the company. For people in our industry, it's hard to see a definition of "reasonable" that would be financially beneficial. You start a tech company. You pull $100k out every year, putting you right smack in the middle o…

> To support that (sorry) scam, you claim $50k is your "reasonable" salary --- putting you way on the low side of the industry. How convenient. I don't know. What salary would you take for your honest-to-god dream job?

I might take a $50,000 salary to fly gliders all day. But no matter how nice of a job it is, I'm not going to take a $50,000 salary to program computers all day, because I can get a job in that field that's only marginally less nice and pays way more.

Re: Mistakes You Should Never Make

#344

Post by [deleted] »

Aqueous wrote: post #301
maxbrown wrote: post #294

Earlier quoted context omitted.

I see your point, it can put added pressure on developers, but don't you think (in a healthy company) that "shifts responsibility for fuck-ups" is a bit overstated? Certainly transparency in sales is preferable, but is promising a (unexpectedly important to that customer) feature to close a major deal a "fuck-up"? There are some potential issues to steer clear of - team burn-out, feature bloat, etc. - but I would jus…

Yes. Absolutely. I work for a company where deadlines are continually mismanaged for features because it really isn't predictable when a feature gets done or not. And the problem is at the top - but the top doesn't ever blame themselves. And so the blame shifts backward onto the engineers who didn't make the unreasonable deadline. The worst part is that the founders are non-technical so they really have no business m…

[deleted]

Re: Mistakes You Should Never Make

#345

Post by Aqueous »

maxbrown wrote: post #334
Aqueous wrote: post #301

Earlier quoted context omitted.

Yes. Absolutely. I work for a company where deadlines are continually mismanaged for features because it really isn't predictable when a feature gets done or not. And the problem is at the top - but the top doesn't ever blame themselves. And so the blame shifts backward onto the engineers who didn't make the unreasonable deadline. The worst part is that the founders are non-technical so they really have no business m…

To me this just sounds like poor company/project management and passing the buck. I guess I'm envisioning a more healthy/well-managed environment, but maybe those are in the minority.

Almost all of the time the project we are doing for the client is so valuable that they eventually become quite pleased when we deliver what they wanted. But the mere imposition of a hard deadline on a feature that the deal-maker imagined because the client requested it is something we should change. I just think better/more flexible deadlines would be a good idea, in general, and overpromising to a client prevents that.

My experience in my office has been good otherwise, so perhaps I was being too negative above.

Re: Mistakes You Should Never Make

#346

Post by wpietri »

mikeash wrote: post #341
wpietri wrote: post #129

Earlier quoted context omitted.

Weirdly, I feel for the IRS here. Early on in the days of the Internet, I would actually call up spammers and try to help them understand why they should stop. 80% of the people were confused small businesspeople who were glad somebody gave them the straight scoop. 20% were weasels who would say or do anything as long as it got them what they wanted. After a few decades of bullshit excuses from irredeemable idiots, I…

I can't see how failing to pay hundreds of thousands of dollars in taxes because you can't be arsed to make the basic comparison of "what am I paying" with "what am I supposed to be paying" can be described as a "reasonable mistake".

Do you believe this person was literally unable to reason? Or acting from fraudulent intent? Is this perhaps a mistake that no other person has ever made?

If you're not saying yes to one of those, then I'm not seeing what category applies other than "reasonable mistake". I agree it's a noob mistake, but a lot of businesses are started by noobs.

Re: Mistakes You Should Never Make

#347

Post by mikeash »

wpietri wrote: post #346
mikeash wrote: post #341

Earlier quoted context omitted.

I can't see how failing to pay hundreds of thousands of dollars in taxes because you can't be arsed to make the basic comparison of "what am I paying" with "what am I supposed to be paying" can be described as a "reasonable mistake".

Do you believe this person was literally unable to reason? Or acting from fraudulent intent? Is this perhaps a mistake that no other person has ever made? If you're not saying yes to one of those, then I'm not seeing what category applies other than "reasonable mistake". I agree it's a noob mistake, but a lot of businesses are started by noobs.

I merely believe that he was not reasoning when making this mistake. That's all "unreasonable" means.

Given the rest of the story and his replies, I'm also inclined to believe that the mistake was ultimately due to lying to himself about the importance of bookkeeping and how fast funds should have been spent. But even absent that, "unreasonable" is a totally reasonable word for this.

Re: Mistakes You Should Never Make

#348

Post by wpietri »

mikeash wrote: post #347
wpietri wrote: post #346

Earlier quoted context omitted.

Do you believe this person was literally unable to reason? Or acting from fraudulent intent? Is this perhaps a mistake that no other person has ever made? If you're not saying yes to one of those, then I'm not seeing what category applies other than "reasonable mistake". I agree it's a noob mistake, but a lot of businesses are started by noobs.

I merely believe that he was not reasoning when making this mistake. That's all "unreasonable" means. Given the rest of the story and his replies, I'm also inclined to believe that the mistake was ultimately due to lying to himself about the importance of bookkeeping and how fast funds should have been spent. But even absent that, "unreasonable" is a totally reasonable word for this.

No, the word for "not reasoning" is "unreasoning". "Unreasonable" means something else. In the phrase "reasonable mistake" I mean it in the sense of "ordinary or usual". E.g.: http://legal-dictionary.thefreedictionary.com/reasonable

It is not unusual for new or small businesses to just wing it on accounting for a while and then hire an accountant who has to tidy things up. (If you don't believe me, ask any small business accountant; my pals have story after story like this.) If we take him at his word, him thinking that the payroll service was handling the withholding is also reasonable. And him assuming everything was jake unless somebody was yelling at him is not just reasonable but typical of first-time entrepreneurs. The main unusual thing here is the scope of error and consequences, but startups are all about rapid increase in size, so that's not unusual in context.

Of course, this could also be fraud: he could have known for years that he wasn't paying withholding, hoping to make it up later. It could be that he actively avoided thinking it through or was willfully careless, which would make it negligence. But as he presents it, it's a reasonable mistake. You can see more about exactly what this means if you look in legal sources for "mistake of fact".

That said, I think your skepticism about his story is reasonable. That his partners have both quit after losing confidence in him would make me unsurprised if this turned out to be fraud, not just an honest but titanically stupid mistake.

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