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Old 07-08-2016, 11:51 PM
astro is offline
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Join Date: Jul 1999
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Quote:
Originally Posted by VaneshkaP View Post
I guess maybe money laundering wasn't the best term to use? Hypothetically yes we were going to possiblyou purchase a place. Happens to be a place that my brother has been going for years and then one thing leads to another and he is closed friends with a few of the bartenders and so he knows this place and it's clientele better than most. I do not think I need to mention that the payroll consists of like 2 people when there is actually about 8 or so working who collect their pay in cash, however, after further interest etc etc and seeing the tax returns I am beyond skeptical as is my brother. The numbers are beyond BS. The deductions are almost all of the income and the cash being paid out to the employees is obviously something I think could and would cause problems especially if an audit were to happen. Curious curious and more curious Hypothetically here ... and again if it isn't money laundering... why and on what basis would a tavern want to inflate their gross sales by an obscene amount (meaning the place doesn't ring more than $40k-$50k so why over inflate so much?
As a rule in selling businesses small cash businesses like bars and convenience stores that are owner-operator non-franchise operations hide as much cash as possible while operating so their tax return history should show very little income. When they go to sell they will have a difference balance sheet that is often just s much BS for potential buyers.

People who are not intimately familiar with the way operations like this are run (and you and your brother are obviously not familiar) have no way of knowing what the real numbers are. Bars are irresistible candy to many people who have romantic notions about what is, at root, a tedious and difficult way to make a living and many, if run honestly, would not be worth operating as the net cash flow after taxes would not be worthwhile. It is also unlikely you will be able to finance the purchase as banks are not stupid enough to take their half assed financial statements at face value.

You and you brother need to find another place to put your money this is not good investment for beginners.