No, not because he started an affiliate network where charged people to join and had the shittiest payouts possible, but because he got beat by the tax man.
I have a junk box setup for guru bullshit and i saw this email from Shoemoney. I don’t know if it’s “OK” to publish this email, but Shoemoney can send me the C&D like he does to everyone else that mentions his name with commercial intent. Go get yourself on shoe’s list so he doesn’t have a hissy fit and pretend you got this email too.
Anyway, this email chronicles the story of Mike Filsaime‘s retardation of not doing the proper paperwork for the IRS. Even the most half-assed business person knows about 1099′s… and how someone generating millions of dollars a year DID NOT DO THIS IS FUCKING AMAZING TO ME.
Really dude? Fucking millions of dollars a year and you couldn’t afford a fucking CPA (cert. public accountant …. not the other CPA) that went “Hey, wait a minute Mike… I think you need to fill out some 1099′s” You figured “Paypal was good enough?” WHAT THE FUCK IS WRONG WITH YOU? HOW THE FUCK DID YOU GET THIS FAR IN LIFE?
The best part of this story, and by best I mean worst, is that Mike Filsaime is leveraging his stupidity into a product called Pay People Online. This product tracks 1099′s or some shit for people you pay through paypal.
WOW MIKE GREAT IDEA. HOW COME I DIDN’T THINK OF THIS?! Oh because I have a CPA that doesn’t smoke fucking crack and tells me obvious shit.
This story exemplifies the disconnect between real life businesses and online businesses. You think just because it’s online the same rules don’t apply? Well, when it comes to the IRS, you better believe they do. Now you’re $1.5 million poorer HAHAHAHAHAH!
From Shoemoney:
As I always say I learn 100x more from my failures then from my successes. What do you find more scary? Getting dinged by the IRS for 1.5 Million dollars in fines and penalties or having the FTC break down your door and virtually bankrupt you? One story we will cover in this email and the other in another week.Mike Filsaime has been one of the biggest internet marketers in the world. His products have done millions in sales annually. Mike also has an army of affiliates that act as commission based sales people to sell products for him and he has paid out hundreds of thousands of dollars to them for years. I am sure many of you reading also pay people in some regard… maybe you have affiliates or maybe you just have contractors or other people you pay money to. All of you can benefit from hearing Mike’s story.
In Early 2008 the IRS conducted a random audit on Mike Filsaime’s company. There was nothing Mike did to trigger the audit, well other then being in our industry and the crazy spikes we see in revenue setting off some “Red Flags”. Anyway… They went over all of his financial records going back 7 years and came back to him with a huge mountain of paper work asking where his 1099′s were on all these people he had paid money to.
Mike told me for years he had been paying money to affiliates via PayPal and figured that was good enough records to keep on them. He had no clue he needed to also get a 1099 on every person he was paying money to through PayPal. After all… PayPal has records on these guys right?
The IRS told him it did not matter what PayPal had. It was HIS responsibility to have the 1099 tax forms on file for each of these people he was paying money out to. OUCH.
Mike said they not only let him NOT deduct those expenses but now HE now had to claim that income on that money that was actually paid out to people.
But here is where it really sucked…. bad…
Since some of the people Mike paid were way back in the early 2000′s… and he now had to claim that as income…. Guess what? That’s right he had to pay the taxes PLUS a fine for each infraction AND interest on that money FOR THE LAST 7 YEARS.
Now the actual money paid out to affiliates that he did not have 1099′s on only totaled a couple hundred thousand dollars but Mike had to write a check to the IRS for back payments, fines, and interest for over 1.5 MILLION dollars…. ZOMG!!!!!!!!!
So what did Mike do wrong? He always paid all his taxes and took proper deductions. He just did not have good paper work and that cost him 1.5 million dollars of his hard earned profits.
Mike told me over a year later he still thinks about it at least once a day what he could have done with that money. Help family and friends… Build a school for children in a 3rd world country…. geez…
But like most bad ass serial entrepreneurs Mike figured out how to turn his experience into an incredible positive.
He created a service that completely prevent people from ever ending up in his shoes. Honestly I can’t believe someone has not thought of this yet.
The website is called Pay People Online and its pretty hot. Right now its 100% free to use.
The way it works is you upload your payment file to it… then if it does not have someones electronically filed 1099 on record it emails them and tells them they need to complete it in order to get paid. Once this is done it lets you know.
For users who use PayPal Mass Payment files (like 99% of us) its even easier. You just upload your mass pay file to it, it then checks to see if it has 1099′s on file and if not emails people and lets them know they need to fill it out to get paid, then spits you back out a payment file for people you DO have 1099′s on.
Slick eh? I really like this site and I think its going to turn out to be worth MUCH more then the 1.5 Million that it cost Mike to have an epiphany about this much needed service.
I say it all the time adversity is opportunity and this is a classic example of just that.
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I’m just taking a stab in the dark here, but I’m guessing that you don’t like Mike F. Can’t blame you, he does seem rather seedy.
I’d like to leave a message for Mike Filsaime. My message is…. hi.
Man, I can’t stand this Mike Filsaime guy. At some point in my marketing career I must’ve signed up for some bs of his because I cannot get this fuckers emails to stop hitting my fucking inbox. Seriously, how many times should I unfuckingsubscribe from your fucking list to get you to stop sending me shit!?
Nice post btw.
This is one of the most mind-boggling things I’ve heard in a long time. I can understand the 1099 confusion if you hire out very little and you’re not much of a numbers person. I even know a very intelligent person who hired a less than intelligent CPA that didn’t bother to tell him about the need for 1099s. But with a business that big?? I can’t even comprehend this kind of stupidity.
What’s worse is that every time I think of how stupid it was, I get these awful flashes of the time I saw a picture of Mike Filsaime. It would be hard to find a more disgusting, filthy, slimy little creature than that man.
“What’s worse is that every time I think of how stupid it was, I get these awful flashes of the time I saw a picture of Mike Filsaime. It would be hard to find a more disgusting, filthy, slimy little creature than that man.”
lmao pure gold
OMG LOOK at that slime ball He has no ears He is a SNAKE!!
Mike Filsame – Gettin that I can has money.
Even worse than not filing all those 1099s is the fact he didn’t even hire a tax attorney to negotiate his payment.
IRS: Hi, we can haz 1.5 mil monies?
Mike: Sure!
Hi, we can haz 1.5 mil monies?
Classic
what a dumb fuck. 12 year old girls who run lemonade stands probably have more business accounting experience than this moron.
I understand why some people don’t like (or in this case hate) him, and yeah definitely with that size of a biz he really should have taken steps to get that stuff in order, but what is y’alls opinion of his new service? Does it have merit? I can see it being of value to some segments of internet marketers (mostly the info product type) that don’t want to deal with this issue of taxes to a bunch of affiliates earning a couple hundred/thousand dollars.
Hey people,
Just a wild guess here, maybe I’m way off but if Barman says that Mike F is leveraging his 1.5 Mil stupidity to promote his new product doesn’t it make sense this whole story is made up in order to promote the new product? Something like “if it happened to me, and it happened big time, it can happen to you too”?
And of course, Shoemoney gets his share from this promotion too.
Think about it.
I’m onboard with the “made up bullshit” notion
Haha, what a fucking idiot.
This is the angriest post in a while, good to have you back buddy.
u fucking prick
go make some freaking good content already
we are sick of ur boring posts
this blog aint the shit as it used to be
just got real
Wow you just tore him and Shoe a new one. I got the email and it gave me the ‘Meh sucks for him’ attitude but like you said, if you are getting hit for 1.5m in taxes you probably made out like a bandit for the last 7 years, hire some serious accounting help lol.
*note to self, some day make money and hire a cpa.
I understand he clearly needed to send 1099s to guys he was paypaling payments too but what do you do when you buy traffic from companies.
My CPA said I need to send 1099s to any non INC company. So that would mean Trafficvance would get one since its an LLC.
Did your CPA give you the same advice. Seems weird sending 1099s to big companies like Trafficvance just because they are not an INC.
He said you should really send a W-9 to any person/company you send payments too just to have evidence if they are INC, LLC or whatever.
I bet some guys will get fucked on some big media buys they bought when they went direct to a site and made a deal. Most of them probablly needed to be sent a 1099.
do you even know what a 1099 is?
Just goes to show you that anyone Big or small is not immune to the big bad government… Im surprised it was not more than 1.5 million..
Don’t worry, Filthy Shame will get his soon enough. Rumor has it that the FTC is going after him, all his employees, and all the “syndicate” douche bags very very soon …
Fernando here,
Well he might be a Guru in the online arena, but every one in this world makes mistakes, not to mention that nobody is perfect. he did not know about how to do his taxes, well I bet he knows now.
Warning. Do not try to fuck any women until you have printed out and eatin this blog. Swallowing this shit will make you a big prick.
Is Mike Filsaime even around anymore… haven’t heard from him since last year.
I guess you haven’t heard that Mike and Chris Farrell have partnered together and released a new coaching program called AffiliateDotCom com??
That 1.5 million is going to seem like pocket change once PayPal gets wind of this new “PayPal People”
endeavor…
I know you just heard of 1099′s Mike, but you might also want to look up ‘Non-Compete’
The Dark Overlords at PayPal are going to sue your ass for every penny you have ever withdrawn from their site.
Cheers
Lots of people have lots to say… Maybee they feel better by laughing at another’s failures to mask there own failures.. I guess you feel good posting something like this to help deal with your own pain… Either way just something to chew on and only 0.00016 % of you will ever achieve real wealth worth speaking about… So cast your stones as you may but know your foolish anyway…
Mike is a genus Marketer. you only wish you could even have a percent of that clout … Or you would not be ridiculing to get your ranks up. . PPO is sick and can help your business for the wise that use it..
Dont get mad learn from others mistakes…. If this happen to you you would be shiting a brick… And it takes n A player like Mike to overcome it… Can you handle that… Dosnt appear so… Based on your post is very childish and not to metion masking your own failures ….
Judging by your literacy skills, you = Mike Filsaime
Mike just started new campaign “ProfitPlugNPLaySite” I see if it is work or bullshit.
Mike Filsaime is a success. I love his stuff and it keeps me on top of marketing and product ideas. Who IS to blame for all this is his teacher Rich S. who taught him how to bring the business up from $15K to over $200K a month. (now $1 Mil.) He’s the guy that should have mentioned to scale your taxes as you grow. But hey, online Internet Mktg doesn’t even charge a state tax across the US because it’s just a download and an out-of-state sale on the most part at that!
But that’s another story, for this has to do with Affiliate’s 1099s. Many say, “Let the affiliates file their own taxes or ask for a 1099″. Still… I think this new program of his called PayPeopleOnline is the best thing. Congrats
Well after reading this, i don’t think he is the coolest guy on the planet anymore!
Well…all I can see are two main points:
1) Mike lost a lot of money but he’s doing something that could bring him back the money, and even more, help others not to get in such troubles.
2) The post is full of hate, which normally originates from envy, and fury that other people can make money and you cannot.
I will not hide myself …. I worked for Mike almost 3 years, I quit my job there for another oportunity. I do not regret I quit from there, but I do not regret that I worked for him … and this is not for the money he paid me, or the projects I worked on … but this is because of Mike really is. He is a MAN, and that says it all. I’m from the other side of the world, from Romania and now I work for a dutch company. I travelled through the whole Europe and I work with Customers from 9 countries … believe it’s hard to find a MAN like Mike. But success comes with a cost … Mike’s success seems to bring hate and fury to others … for me it’s weird.