Studying at Western University starts with a knife-forging competition

"As you know, my family runs a private equity fund. The taxation of private equity funds is a million times more complicated than yours—multi-layered structure, cross-border investment, capital gains, dividend reinvestment, and each layer has different tax treatments."

Our family couldn't possibly entrust these tasks to strangers. Therefore, my uncle's company was initially for our family's use, and only later did we gradually start taking on external business.

"Does he only work with corporate clients?"

"Not entirely. He also works with high-net-worth individuals. At your level—" Matt glanced at the envelope on the coffee table, "you're barely at the threshold for their business."

His company has a team that specializes in taxing self-employed individuals, including artisans, freelancers, and contract workers. Their tax filing logic differs from that of ordinary salaried workers.

What you need isn't just any random accountant on the street to fill out forms for you; you need a professional team that understands self-employment taxes, deductions, and can help you with tax planning.

Lin Yuan thought about it and realized that Matt made sense.

Taxes are simple for ordinary wage earners; just get a W-2 and fill out the form on software.

But self-employment income is different—he needs to calculate his own quarterly pre-paid taxes, file his own self-employment tax return, and deduct business-related expenses himself.

Material costs, equipment depreciation, workshop rent, water and electricity bills, and even the mileage he drives to the forge can all be deducted, but only if he knows how to deduct, what can be deducted, and what cannot be deducted.

If he figured it out himself, it's not impossible, but it would take a lot of time to look up tax laws and read IRS publications. And if he misunderstands something and makes a mistake, the consequences would be more than just paying back taxes and fines.

It's worth noting that Al Capone, the former Chicago mob boss, was prosecuted for tax evasion and served eleven years in prison.

"How do you charge your uncle's company?"

"We charge based on the services provided, not as a percentage of revenue. For a small business like yours, the annual service fee would be between several hundred and several thousand US dollars. This includes annual tax filing, quarterly pre-tax calculation, and tax planning consultation. If you'd like, I can help you get a specific quote."

Lin Yuan leaned back on the sofa, twirled the can of cola in his hand a couple of times, and suddenly said, "We need to discuss how to split this money."

Matt, who was looking down at his phone, looked up at him when he heard this, put his phone on the coffee table, and sat up a little straighter from his slumped position.

"You finally brought it up. I was just about to tell you this anyway." He crossed his hands on his knees, a rare serious expression on his face. "It's true that I invested money in the forging workshop, but you contributed your skills. This business is running thanks to you."

I thought about it for a moment—30/70, you get 70% and I get 30%, what do you think?

Lin Yuan stared at him for a few seconds.

Matt Wayne, a guy who even texts his roommate to ask which drawer he puts his socks in, is quite decisive when it comes to splitting money; he's clear about the details and generous with his share.

After Matt finished saying "37", he leaned back on the sofa, as if he had already figured out the score in his mind, and looked very relaxed.

Lin Yuan didn't reply. He put the Coke can back on the coffee table, stared at Matt for two seconds, and then spoke.

"Fifty-five."

Matt paused, then frowned. "Are you kidding me?"

"I'm not kidding." Lin Yuan crossed his legs and leaned back on the other end of the sofa, his tone as casual as when he was discussing what to eat tomorrow. "You invested in the equipment, you manage the operations, and from now on, finding an accountant, negotiating the venue, and dealing with Pat's side will all be your responsibility."

"I've already given you a good deal by just standing in front of the furnace and swinging the hammer; I've already taken half of what you wanted."

Matt sat up straight, looking at him with an expression that said, "Are you out of your mind?": "You're taking advantage of me? Do you know how much this knife sold for? Fifty thousand. Without your craftsmanship, that forge is just an empty house, and all my equipment is just scrap metal."

"I'm already being shameless by taking 30%, and you're giving me 50%—how am I supposed to eat your cooking after this?"

"Eating is eating, and business is business."

"Don't give me that." Matt pulled the cushion out from behind his back and hugged it to his chest, leaning forward. "30/70. You get 70%, I get 30%. If you think I'm losing out, just cook me a couple more meals of braised pork next time."

Lin Yuan didn't back down: "Fifty-fifty. If you don't agree, I won't take a single penny of the money for this knife; I'll put it all into the workshop's account as operating capital."

Matt stared at him for three seconds, opened his mouth and then closed it again, finally letting out a sigh that was somewhere between helplessness and amusement: "You—when other people get their share of the money, they pocket the lion's share, but you, you push it out."

"the same as you."

Matt was taken aback by those words.

Indeed, when he mentioned Panax notoginseng just now, he was pushing it away.

The two sat on the sofa, separated by a coffee table, each holding a cushion, neither willing to give in first.

After a few seconds of silence, Matt spoke first. "Forty-six."

Lin Yuan raised his eyelids to look at him.

"You get 60%, I get 40%." Matt's tone wasn't like a negotiation, but more like he was trying to find a compromise that both of them could accept. "If it's 50/50, you think you're getting a good deal; if it's 30/70, I think I'm getting a good deal. If it's 40/60, neither of us will say we're losing out. Is that okay?"

Lin Yuan thought for a moment, then his lips twitched slightly: "You four, me six?"

"Yes. You take the lion's share, I'll take the smaller share. After all, you're the one doing the work, I'm just a helper."

"You're a general laborer?" Lin Yuan chuckled. "Go ask around and see which general laborer can handle the union, negotiate factory space, and even bring their own accounting firm."

"That's why I only take 40%." Ma Ding leaned back confidently. "If I were just doing odd jobs, I'd think even 10% was too much."

Lin Yuan shook his head, but didn't argue anymore. "Fine, 40/60. You get 40%, I get 60%."

"Is it settled?" Matt raised his fist.

Lin Yuan also extended his fist and bumped it with his: "It's settled."

Matt withdrew his hand, slumped back into the sofa, hugged the cushion, and wore a relaxed expression that said, "Finally, this is all done."

"I'll have my uncle's accountant do the bookkeeping for you according to this ratio. We'll deduct the costs of materials and equipment depreciation first, and then split the remaining profit 40/60. Don't worry about these things, just focus on your work."

"OK."

"Also," Matt turned to look at him, his expression suddenly turning serious for a moment, "if you ever feel that the ratio isn't right, just let me know. We'll adjust it again."

Lin Yuan nodded without saying anything more.

The can of cola on the coffee table wasn't very cold anymore. He picked it up, drank it all in one gulp, and threw the empty can into the kitchen trash can.

A game sound effect, mixed with faint laughter and curses, came from one of the rooms in the corridor.

The oak leaves outside the window rustled in the night breeze, casting swaying shadows on the curtains.

The two of them sat on the sofa, the TV off, their phones off, and neither of them spoke.

After about half a minute of silence, Matt suddenly blurted out, "If my dad knew I was taking 40%, he'd definitely say I don't deserve it."

Lin Yuan turned his head and glanced at him.

“He didn’t say I wasn’t capable,” Matt said, setting the cushion aside and putting his hands behind his head. “He just felt that this business was all thanks to me, and that I was lucky to get a piece of the pie, let alone the big prize.”

"Then tell him that the workshop wouldn't have started without your investment, and its operations would have been a mess without your management. You're not just there to get a share of the profits; you're the one adding fuel to the fire. Without firewood, the pot won't even get hot."

Matt paused for two seconds, then chuckled softly, "Okay. I'll tell him that next time I call."

He stood up from the sofa, stretched, took a couple of steps toward his room, then turned back and said, "By the way, I'll go ask my uncle about the accountant tomorrow and deposit the checks while I'm at it."

Did you deposit that 50,000 check into the workshop's account or your personal account?

Lin Yuan thought for a moment. "Let's deposit it into the workshop account first. Material costs, equipment maintenance, and Daniel's salary will all go through that. We'll distribute the rest at the end of the year."

"Okay. I'll take care of it first thing tomorrow morning."

Matt pushed open the door and went inside. The door wasn't closed tightly, leaving a crack through which warm yellow light leaked out, drawing a thin, bright line on the hallway floor.

Lin Yuan sat alone in the living room, going over the division ratio in his mind.

Forty percent, six for Matt. Matt invested in the equipment, managed the operations, built relationships, and even helped him with the taxes; taking forty percent isn't much.

But Matt insisted he only deserved 30%, so they compromised on 40%, with both feeling the other was taking too little.

He recalled how his father settled wages with the workers at the factory—the old man never haggled over wages; whatever the workers asked for was what he got, and at most he would ask, "Is that enough?"

His father once said: "A craftsman's money is earned by hammering away, one strike at a time. Every strike counts. Pay him whatever he deserves. Don't skimp on his livelihood."

Matt isn't a craftsman, but what Matt does is worth that much.

Lin Yuan stood up, turned off the living room light, and went back to his room.

The curtains weren't drawn, and the streetlights cast small, orange patches of light through the glass onto the floor. He lay in bed, staring at the ceiling, pulling the blanket up to his shoulders.

Fifty thousand US dollars. After splitting it 40/60, he received thirty thousand. Thirty thousand US dollars is a little over two hundred and one thousand yuan.

This was the first big sum of money he had earned since coming to the United States, several times more than the total amount he had earned from odd jobs in the past two years.

And this is just the beginning—Nielsen's orders, Jason's orders, and the surge in traffic that Matt planned to film and post online after the suture was completed—the road ahead has already been paved.

He rolled over, folded the pillow in half and placed it under his head, then closed his eyes.