Each Advisor is paid on the 10th of the month based on any account that has your rep code attached to it.

Each FA needs to set up a new personal bank account because they are paid via your social security number.

Each FA will set up their own individual Entity.

All FA involved in the Practice will set up a joint shared/Marketing Entity.

Once the funds are received in your personal account, they will transfer 100% into their individual Entity account.

All Bills -Contracts will (example lease and Internet) be set up under the joint entity.

Each FA will be responsible for their proposition share for the invoice. The joint entity will invoice each FA for their share of the bill and then the joint entity will pay the invoices.

All business expenses will be paid at the entity level, including Salary, distribution, and other expenses. You will need a comprehensive operating agreement to outline expenses, contract, and distribution level approvals.

The main difference in this scenario is you will have FA that are not part of the shared Entity – owner in the Primary Practice. Typically, they still need to set up their own entity unless you add them as an employee. If they are not an employee, they are a1009 worker and you will have some type of shared expense agreement with them based on the services and tools you will be supporting. This can be paid out as a split of the commissions, a flat fee or both. Each agreement can be negotiated separately, and Myriad can assist you.

At the end of the year, each FA will receive 1099 from your Broker Dealer for the amount deposited into your personal account. Each FA will then create a 1099 from themselves to the Entity for the same dollar amount this is called nominee. All money left in the FA entity will flow back to the FA personal tax return via a schedule C or K-1 depending on the type of entity.