[guelo]

I think I disagree, for a $30k investment all the paperwork is useless and distracting from getting things done. Just do a handshake agreement with your partners and get down to doing the real work. After the $30k is gone, which will happen surprisingly quickly, you can look at your business more honestly and see if figuring out the paperwork is even worth it. I wouldn't even bother thinking about taxes, screw the IRS, there is no way for them to know about that $6k salary if you don't tell them, if you're successful later you can have an accountant figure out the mess. $30k is a short window to actually get something out the door, don't let anything else distract you.

[tptacek]

"there is no way for them to know about that $6k salary if you don't tell them"

Best advice ever.

[shuzchen]

I don't entirely disagree with your position, but considering the publicity and press coverage they've received (both before and after the kickstarter funding), it's harder from their position to feel like they can safely slip under the radar. Also, from the IRS pov it's not a $6k salary, it's $30k+ income. It's only after you deduct all the business expenses does it come down to $6k profit. I'm not entirely certain how kickstarter works, but I would be surprised if they didn't file paperwork with the IRS when they transfer the $32k-fee to the developers. Vegas casinos report winnings to the IRS at a cut-off point way below that.

[tptacek]

They file 1099's like everybody else does. If you don't file, the IRS will just impute taxes to you at the least favorable possible rate, and probably not tell you about it until after you've incurred penalties.