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Economic sanctions? Do we really have any substantial economic relations with Pakistan so that economic sanctions could have any real meaning? Also, can we enforce such sanctions?Economic sanctions have meaning only when some “Dada” is acting, such as the USA. US is the biggest (or one of the biggest) trading partners of most of the countries. Moreover, most countries’ banks and other financial institutions have some or the other dependence or connections with the US institutions and agencies. In case of US sanctions, the functioning of the financial institutions of the country at the receiving end may drastically suffer, at least in the matters of their international functioning. The fact that the US Dollar is the most-favoured currency or the de-facto currency for international trade, worsens the scenario.Look at how India is fretting at the prospect of sanctions on Iran, due to which India is supposed to stop buying oil from Iran. Now, who is US? It is not UN. It is merely a single country. Why should India obey its dictates? And, yet, India is worried and trying to convince US to give it exemptions or trying to please US by agreeing to reduce its oil intake from Iran instead of completely stopping it.Look at purchase of S-400 Missile Defence System from Russia that India is contemplating. Since US has imposed sanctions against Russia, India is facing problems in this purchase. Don’t go by the bravado of Indian ministers which is displayed in public domain. It is trying to convince and please US to allow it to go ahead and buy S-400, without the sanctions on Russia affecting India, by seeking a waiver of the sanctions. But, as recently as just two days back, the US has again warned India over S-400 deal with Russia.[1]So, a country like US has tremendous nuisance value to affect even third countries when it imposes sanctions on a particular country.What about India?We Indians keep on telling US to declare Pakistan as a “terror state”. But, do we ourselves have the courage or resolve to first ourselves declare Pakistan as a “terror state”, whatever it means? Have we done it ourselves so far? It is like a meek student in a class requesting the Dada student of the class to teach another classmate a lesson since he himself cannot do anything.What economic leverage does India have against Pakistan? What is the level of India-Pakistan trade?In FY 2017, India-Pakistan trade was only about $2.29 billion, which is just about 0.35% of the total Indian trade of about $660 billion.[2] In contrast, India’s trade with a small country like Bhutan is also about half of that at about $1.20 billion.This trade is so miniscule that any economic sanctions by India will have no practical meaning. Pakistan will not be bothered or affected adversely. No third country will support India in such economic sanctions. Unlike the US action, when (almost) the whole world listens and acts.India’s (unofficial) economic blockade against a land-locked Nepal also were of no practical use. Every now and then, Nepal shows its “angootha” (thumb) to Indians, despite the fact that we allow Nepalese citizens to even become Group “A” or Class I officers in India on the basis of the Civil Services Examination conducted by the UPSC (however, he cannot become IAS, IPS or IFS; but he can become, for example, IRS or IAAS).Moreover, forget economic sanctions, long back, India had given the “Most Favoured Nation” or the MFN status to Pakistan in trade matters. This is despite the fact that Pakistan has not yet declared MFN status for India, even after so many years.So, can India revoke the MFN status first? Before it thinks of economic sanctions?In fact, India has been acting as a juvenile in its relations with Pakistan. One day, we decide to hold talks with Pakistan. Then, the talks are off. Again, we decide to hold talks. Again, the talks are off. In last 10-15 years, this must have happened 100 times. The latest episode happened just a few days when India, at first, agreed to talks with Pakistan (between their foreign ministers), and then cancelled it when 3 SPOs were killed by terrorists in J&K at the behest of ISI.[3] Now, is killing of the Indian soldiers by Pakistanis happening for the first time? Why did we agree for the talks, in the first place, then?Imran Khan appears to be following in the footsteps of Donald Trump by behaving in an undiplomatic manner. He has tweeted calling it arrogant and negative attitude of India. He even called Indian PM Modi (without taking his name) being a small man occupying a big office without having any vision.So, come on. We should decide – either to have talks with Pakistan or not have at all. Decide once and for all. Once we take a decision, then do not change the policy at least till there is a very substantial change on ground. Do not keep changing our stand every few months and become a laughing stock. No flip-flop in these policies.Well, coming back to your question, economic sanction by India against Pakistan will have no impact at all. Instead of that, simply cut off the economic relations. Withdraw the MFN status given to Pakistan.In fact, the biggest leverage that India has against Pakistan is river water. The Indus Water Treaty that the then PM Jawaharlal Nehru gifted to Pakistan. Revoke that river water treaty. Pakistan will come to its knees (or, else, it may react very violently, may be by way of a war, which may see the relations reaching the final stage of this side or that side). But, India does not have the vision or courage to do that too.If nothing else, India can simply ignore Pakistan in all respects. Behave as if no Pakistan exists on this earth. Cut off all diplomatic ties. No relations – economic, political, sports, etc. No drama of Aman-ki-Aasha or whatever, etc. We should only react when needed. At the same time, secure our borders from our own side.Follow Newton’s third law of motion – display equal and opposite reaction of every action from Pakistan on security.Or rather, refine the Newton’s law – show 10 times opposite reaction for every action of Pakistan (as our present External Affairs Minister had proclaimed when she was in opposition; it is high time to translate words into action or reaction).With Imran Khan, who is widely presumed to be a puppet of Rawalpindi, being in the hot seat in Pakistan, things are not going to be easier for Modi Government in the coming days. So, forget economic sanctions, life is going to become difficult even with normal relations.Duniya jhukti hai, jhukane wala chahiye. The world listens to the one who commands respect, and not the one who demands respect despite being a meek person.Footnotes[1] US continues to warn India of sanctions over missile defence deal with Russia - Times of India[2] India-Pakistan trade: status, outlook[3] In one tweet, Imran closes all diplomatic doors, for now - Times of India

With the recent IRS regulations facing non profits, more and more tax exempt organizations are taking annual proactive measures to ensure that they are incompliance andthat positions are not paid at such a level to be determined in excess of “reasonable compensation”. Intermediate Sanctions may be imposed on any disqualified person who receives an excess benefit from a covered non-profit organization and on each organization manager who approves an excess benefit. Intermediate Sanctions allow the IRS to impose excise tax penalties on both the executive and board members involved with the excessive compensation. Having a third party conduct a comparative compensation review of those positions identified as disqualified is an important step in creating a rebuttable presumption of reasonableness, or safe harbor.

All the other answers are good ones. I would just add that if you are a co-owner in this business, you may be just as liable as your partner is, should you be audited by the IRS. Yes, you might be on the hook for penalties. If there are any criminal sanctions imposed because of conversion (especially if there are other owners or investors with a right to that money), you may be liable as well. There is also the matter of piercing the corporate veil, if you are a corporation, That is also a serious matter.I hope this puts real fear into you, since you probably you think since you are innocent, nothing can happen to you. That isn't true. If the company has an attorney, you must notify him of the situation asap.Since you have already spoken to your partner to no avail, you need to speak to your own attorney to make sure you are protected. After you have spoken to your attorney, he will tell exactly what trouble your partner is causing both of you and your company, and you will find a way to extricate yourself from this situation as soon as possible.You will call your attorney first thing tomorrow morning.