New reporting requirements for professional photographers

One of the provisions slipped into the US health care act was a new
reporting requirement for federal income taxes. Starting next year, any
business paying more than $600 to anyone for goods and services must
fill out a Form 1099 and send it to that person and report it to the
IRS. The only exception is credit card purchases. So if you buy an old
truck for $1,000 and write a check for it, you will have to get the
seller's TIN and other information and send him a Form 1099 at the end
of the year. If he does not give you the information you need you are
required to withhold part of the payment and send it to the IRS. Too
bad if you already paid him the whole thing.

Bought a used camera at a garage sale for $800 and paid with cash? You
have to send the guy a Form 1099.

In a trillion dollar economy, this means literally billions of new Form
1099s. There will be errors. When one of your customers sends you a
Form 1099, you will have to check it against your own records to make
sure he did not pay with a credit card and that the amount is accurate.
Every business who paid you more than $600 will have to send you a Form
1099. Once you have checked the 1099s you received for accuracy, you
will have to spend time working with customers, vendors, and the IRS to
correct any errors.

Good luck with that if you are a sole proprietor with no employees.

ASMP has been recommending an exemption for businesses with fewer than
25 employees, although that provides no relief for the 1099s that you
receive. I believe the requirement should be dropped completely.
Nevertheless, here is the letter that ASMP thinks you should send. I
would modify it to a request that the requirement be dropped.

TO:
Notice 2010-51
Dear Sir or Madam:
I am a professional photographer and a small business person. I have
virtually no administrative staff to handle my record-keeping and
reporting responsibilities. The new requirement under Section 6041 of
the Internal Revenue Code would place impossible burdens on me. The
exemption for credit card transactions was a great step toward reducing
the impact of this change in the tax code. Unfortunately, it does not
go far enough.
I often pay for computer and camera equipment, studio and equipment
rentals, catering services, and other items by check or cash. Those
expenditures often total more than $600 per vendor in any given year.
Having to keep separate track of each of these items — and then to
issue Form 1099’s to each vendor — would simply take more time than I
have as the owner of a very small business operation, and it would
require back office support that I do not have and cannot afford.
Please change the requirements so that they apply only to larger
business entities, such as persons or entities that employ more than 25
people.
Thank you for your time and understanding.

--
Waddling Eagle
World Famous Flight Instructor

"John A." wrote in message
...
On Fri, 27 Aug 2010 09:30:13 -0700, C J Campbell
wrote:

One of the provisions slipped into the US health care act was a new
reporting requirement for federal income taxes. Starting next year, any
business paying more than $600 to anyone for goods and services must
fill out a Form 1099 and send it to that person and report it to the
IRS. The only exception is credit card purchases. So if you buy an old
truck for $1,000 and write a check for it, you will have to get the
seller's TIN and other information and send him a Form 1099 at the end
of the year. If he does not give you the information you need you are
required to withhold part of the payment and send it to the IRS. Too
bad if you already paid him the whole thing.

Bought a used camera at a garage sale for $800 and paid with cash? You
have to send the guy a Form 1099.

In a trillion dollar economy, this means literally billions of new Form
1099s. There will be errors. When one of your customers sends you a
Form 1099, you will have to check it against your own records to make
sure he did not pay with a credit card and that the amount is accurate.
Every business who paid you more than $600 will have to send you a Form
1099. Once you have checked the 1099s you received for accuracy, you
will have to spend time working with customers, vendors, and the IRS to
correct any errors.

Good luck with that if you are a sole proprietor with no employees.

ASMP has been recommending an exemption for businesses with fewer than
25 employees, although that provides no relief for the 1099s that you
receive. I believe the requirement should be dropped completely.
Nevertheless, here is the letter that ASMP thinks you should send. I
would modify it to a request that the requirement be dropped.

TO:
Notice 2010-51
Dear Sir or Madam:
I am a professional photographer and a small business person. I have
virtually no administrative staff to handle my record-keeping and
reporting responsibilities. The new requirement under Section 6041 of
the Internal Revenue Code would place impossible burdens on me. The
exemption for credit card transactions was a great step toward reducing
the impact of this change in the tax code. Unfortunately, it does not
go far enough.
I often pay for computer and camera equipment, studio and equipment
rentals, catering services, and other items by check or cash. Those
expenditures often total more than $600 per vendor in any given year.
Having to keep separate track of each of these items - and then to
issue Form 1099's to each vendor - would simply take more time than I
have as the owner of a very small business operation, and it would
require back office support that I do not have and cannot afford.
Please change the requirements so that they apply only to larger
business entities, such as persons or entities that employ more than 25
people.
Thank you for your time and understanding.

This is just the sort of feedback they're requesting at the moment.

More he
http://www.irs.gov/pub/irs-drop/n-10-51.pdf
or he
http://webcache.googleusercontent.co...client=mozilla

Note that in that document it says...

BACKGROUND
Section 6041 generally requires information returns to be made by
every person (payor) engaged in a trade or business who makes
payments, as defined in section 6041(a), aggregating $600 or more in
any taxable year to another person (payee) in the course of the
payor's trade or business. The information returns must be filed with
the Internal Revenue Service and corresponding statements must be sent
to each payee.

In 6041(a) it says...

(a) Payments of $600 or more
All persons engaged in a trade or business and making payment in the
course of such trade or business to another person, of rent, salaries,
wages, premiums, annuities, compensations, remunerations, emoluments,
or other fixed or determinable gains, profits, and income (other than
payments to which section 6042 (a)(1), 6044 (a)(1), 6047 (e), 6049
(a), or 6050N (a) applies, and other than payments with respect to
which a statement is required under the authority of section 6042
(a)(2), 6044 (a)(2), or 6045), of $600 or more in any taxable year,
or, in the case of such payments made by the United States, the
officers or employees of the United States having information as to
such payments and required to make returns in regard thereto by the
regulations hereinafter provided for, shall render a true and accurate
return to the Secretary, under such regulations and in such form and
manner and to such extent as may be prescribed by the Secretary,
setting forth the amount of such gains, profits, and income, and the
name and address of the recipient of such payment.

...so I'm not so sure that would include such things material
purchases but rather fees, payment for services, etc. (Tips are
excluded later in the document.)


Regulations are pending which will clarify the circumstances requiring
reports to be filed. The statute is aimed at minimizing tax avoidance by
those paid in the underground economy. Typically of things congressional,
flies are killed with cannons. In the process, other loopholes will be
opened.


--
Peter

On 8/27/2010 2:56 PM, Peter wrote:
"John A." wrote in message
...
On Fri, 27 Aug 2010 09:30:13 -0700, C J Campbell
wrote:

One of the provisions slipped into the US health care act was a new
reporting requirement for federal income taxes. Starting next year, any
business paying more than $600 to anyone for goods and services must
fill out a Form 1099 and send it to that person and report it to the
IRS. The only exception is credit card purchases. So if you buy an old
truck for $1,000 and write a check for it, you will have to get the
seller's TIN and other information and send him a Form 1099 at the end
of the year. If he does not give you the information you need you are
required to withhold part of the payment and send it to the IRS. Too
bad if you already paid him the whole thing.

Bought a used camera at a garage sale for $800 and paid with cash? You
have to send the guy a Form 1099.

In a trillion dollar economy, this means literally billions of new Form
1099s. There will be errors. When one of your customers sends you a
Form 1099, you will have to check it against your own records to make
sure he did not pay with a credit card and that the amount is accurate.
Every business who paid you more than $600 will have to send you a Form
1099. Once you have checked the 1099s you received for accuracy, you
will have to spend time working with customers, vendors, and the IRS to
correct any errors.

Good luck with that if you are a sole proprietor with no employees.

ASMP has been recommending an exemption for businesses with fewer than
25 employees, although that provides no relief for the 1099s that you
receive. I believe the requirement should be dropped completely.
Nevertheless, here is the letter that ASMP thinks you should send. I
would modify it to a request that the requirement be dropped.

TO:
Notice 2010-51
Dear Sir or Madam:
I am a professional photographer and a small business person. I have
virtually no administrative staff to handle my record-keeping and
reporting responsibilities. The new requirement under Section 6041 of
the Internal Revenue Code would place impossible burdens on me. The
exemption for credit card transactions was a great step toward reducing
the impact of this change in the tax code. Unfortunately, it does not
go far enough.
I often pay for computer and camera equipment, studio and equipment
rentals, catering services, and other items by check or cash. Those
expenditures often total more than $600 per vendor in any given year.
Having to keep separate track of each of these items - and then to
issue Form 1099's to each vendor - would simply take more time than I
have as the owner of a very small business operation, and it would
require back office support that I do not have and cannot afford.
Please change the requirements so that they apply only to larger
business entities, such as persons or entities that employ more than 25
people.
Thank you for your time and understanding.

This is just the sort of feedback they're requesting at the moment.

More he
http://www.irs.gov/pub/irs-drop/n-10-51.pdf
or he
http://webcache.googleusercontent.co...client=mozilla


Note that in that document it says...

BACKGROUND
Section 6041 generally requires information returns to be made by
every person (payor) engaged in a trade or business who makes
payments, as defined in section 6041(a), aggregating $600 or more in
any taxable year to another person (payee) in the course of the
payor's trade or business. The information returns must be filed with
the Internal Revenue Service and corresponding statements must be sent
to each payee.

In 6041(a) it says...

(a) Payments of $600 or more
All persons engaged in a trade or business and making payment in the
course of such trade or business to another person, of rent, salaries,
wages, premiums, annuities, compensations, remunerations, emoluments,
or other fixed or determinable gains, profits, and income (other than
payments to which section 6042 (a)(1), 6044 (a)(1), 6047 (e), 6049
(a), or 6050N (a) applies, and other than payments with respect to
which a statement is required under the authority of section 6042
(a)(2), 6044 (a)(2), or 6045), of $600 or more in any taxable year,
or, in the case of such payments made by the United States, the
officers or employees of the United States having information as to
such payments and required to make returns in regard thereto by the
regulations hereinafter provided for, shall render a true and accurate
return to the Secretary, under such regulations and in such form and
manner and to such extent as may be prescribed by the Secretary,
setting forth the amount of such gains, profits, and income, and the
name and address of the recipient of such payment.

...so I'm not so sure that would include such things material
purchases but rather fees, payment for services, etc. (Tips are
excluded later in the document.)


Regulations are pending which will clarify the circumstances requiring
reports to be filed. The statute is aimed at minimizing tax avoidance by
those paid in the underground economy. Typically of things
congressional, flies are killed with cannons. In the process, other
loopholes will be opened.

So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

Can't we just all get together and shoot the politicians and
bureaucrats, burn the US Code and Code of Federal regulations, and start
over? Only this time with a Constitutional amendment that they have to
carry a copy of each on their person at all times, in large print on
heavy paper, and be able to recite any bill verbatim from memory before
they are allowed to vote in favor of it?

"J. Clarke" wrote in message
...
On 8/27/2010 2:56 PM, Peter wrote:
"John A." wrote in message
...
On Fri, 27 Aug 2010 09:30:13 -0700, C J Campbell
wrote:

One of the provisions slipped into the US health care act was a new
reporting requirement for federal income taxes. Starting next year, any
business paying more than $600 to anyone for goods and services must
fill out a Form 1099 and send it to that person and report it to the
IRS. The only exception is credit card purchases. So if you buy an old
truck for $1,000 and write a check for it, you will have to get the
seller's TIN and other information and send him a Form 1099 at the end
of the year. If he does not give you the information you need you are
required to withhold part of the payment and send it to the IRS. Too
bad if you already paid him the whole thing.

Bought a used camera at a garage sale for $800 and paid with cash? You
have to send the guy a Form 1099.

In a trillion dollar economy, this means literally billions of new Form
1099s. There will be errors. When one of your customers sends you a
Form 1099, you will have to check it against your own records to make
sure he did not pay with a credit card and that the amount is accurate.
Every business who paid you more than $600 will have to send you a Form
1099. Once you have checked the 1099s you received for accuracy, you
will have to spend time working with customers, vendors, and the IRS to
correct any errors.

Good luck with that if you are a sole proprietor with no employees.

ASMP has been recommending an exemption for businesses with fewer than
25 employees, although that provides no relief for the 1099s that you
receive. I believe the requirement should be dropped completely.
Nevertheless, here is the letter that ASMP thinks you should send. I
would modify it to a request that the requirement be dropped.

TO:
Notice 2010-51
Dear Sir or Madam:
I am a professional photographer and a small business person. I have
virtually no administrative staff to handle my record-keeping and
reporting responsibilities. The new requirement under Section 6041 of
the Internal Revenue Code would place impossible burdens on me. The
exemption for credit card transactions was a great step toward reducing
the impact of this change in the tax code. Unfortunately, it does not
go far enough.
I often pay for computer and camera equipment, studio and equipment
rentals, catering services, and other items by check or cash. Those
expenditures often total more than $600 per vendor in any given year.
Having to keep separate track of each of these items - and then to
issue Form 1099's to each vendor - would simply take more time than I
have as the owner of a very small business operation, and it would
require back office support that I do not have and cannot afford.
Please change the requirements so that they apply only to larger
business entities, such as persons or entities that employ more than 25
people.
Thank you for your time and understanding.

This is just the sort of feedback they're requesting at the moment.

More he
http://www.irs.gov/pub/irs-drop/n-10-51.pdf
or he
http://webcache.googleusercontent.co...client=mozilla


Note that in that document it says...

BACKGROUND
Section 6041 generally requires information returns to be made by
every person (payor) engaged in a trade or business who makes
payments, as defined in section 6041(a), aggregating $600 or more in
any taxable year to another person (payee) in the course of the
payor's trade or business. The information returns must be filed with
the Internal Revenue Service and corresponding statements must be sent
to each payee.

In 6041(a) it says...

(a) Payments of $600 or more
All persons engaged in a trade or business and making payment in the
course of such trade or business to another person, of rent, salaries,
wages, premiums, annuities, compensations, remunerations, emoluments,
or other fixed or determinable gains, profits, and income (other than
payments to which section 6042 (a)(1), 6044 (a)(1), 6047 (e), 6049
(a), or 6050N (a) applies, and other than payments with respect to
which a statement is required under the authority of section 6042
(a)(2), 6044 (a)(2), or 6045), of $600 or more in any taxable year,
or, in the case of such payments made by the United States, the
officers or employees of the United States having information as to
such payments and required to make returns in regard thereto by the
regulations hereinafter provided for, shall render a true and accurate
return to the Secretary, under such regulations and in such form and
manner and to such extent as may be prescribed by the Secretary,
setting forth the amount of such gains, profits, and income, and the
name and address of the recipient of such payment.

...so I'm not so sure that would include such things material
purchases but rather fees, payment for services, etc. (Tips are
excluded later in the document.)


Regulations are pending which will clarify the circumstances requiring
reports to be filed. The statute is aimed at minimizing tax avoidance by
those paid in the underground economy. Typically of things
congressional, flies are killed with cannons. In the process, other
loopholes will be opened.

So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server in
a given year come to more than 600 bucks.

Can't we just all get together and shoot the politicians and bureaucrats,
burn the US Code and Code of Federal regulations, and start over? Only
this time with a Constitutional amendment that they have to carry a copy
of each on their person at all times, in large print on heavy paper, and
be able to recite any bill verbatim from memory before they are allowed to
vote in favor of it?


If you eat at Friendlies you won't have the problem.

--
Peter

"John A." wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"

So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

Can't we just all get together and shoot the politicians and
bureaucrats, burn the US Code and Code of Federal regulations, and start
over? Only this time with a Constitutional amendment that they have to
carry a copy of each on their person at all times, in large print on
heavy paper, and be able to recite any bill verbatim from memory before
they are allowed to vote in favor of it?

I realize it's a lot to read and comprehend, but some things you
should do more than skim.

Among other things, tips are specifically excluded.

Aw! You ruined a knee jerk attack by stating facts. Is that allowed?

--
Peter

"Meh" wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"
wrote:


So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

AS usual, TOTAL misunderstanding of the law.

Are you engaged in Trade with that server,
or with the business they work for??

OR, are you just buying lunch as a private person???



Do the math, even if he was doing business and he tips at 20%, that means he
spends over $57 per week at Friendly's. That's a lot of ice cream.

--
Peter

On 2010-08-27 18:50:21 -0700, "Peter" said:

"Meh" wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"
wrote:


So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

AS usual, TOTAL misunderstanding of the law.

Are you engaged in Trade with that server,
or with the business they work for??

OR, are you just buying lunch as a private person???



Do the math, even if he was doing business and he tips at 20%, that
means he spends over $57 per week at Friendly's. That's a lot of ice
cream.

Now, the Rainier Club would be another matter entirely.

--
Waddling Eagle
World Famous Flight Instructor

On 8/27/2010 9:45 PM, Peter wrote:
"John A." wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"

So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

Can't we just all get together and shoot the politicians and
bureaucrats, burn the US Code and Code of Federal regulations, and start
over? Only this time with a Constitutional amendment that they have to
carry a copy of each on their person at all times, in large print on
heavy paper, and be able to recite any bill verbatim from memory before
they are allowed to vote in favor of it?

I realize it's a lot to read and comprehend, but some things you
should do more than skim.

Among other things, tips are specifically excluded.

Aw! You ruined a knee jerk attack by stating facts. Is that allowed?

The politicians and bureaucrats still need shooting and the Constitution
still needs an overhaul to do away with the massive amount of
legislation with which we have been bombarded over the years.

"C J Campbell" wrote in message
news:2010082720544816807-christophercampbellremovethis@hotmailcom...
On 2010-08-27 18:50:21 -0700, "Peter" said:

"Meh" wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"
wrote:


So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

AS usual, TOTAL misunderstanding of the law.

Are you engaged in Trade with that server,
or with the business they work for??

OR, are you just buying lunch as a private person???



Do the math, even if he was doing business and he tips at 20%, that means
he spends over $57 per week at Friendly's. That's a lot of ice cream.

Now, the Rainier Club would be another matter entirely.


They may have a no tipping policy.

We stayed at the Pebble Beach Lodge, where they have such a policy.

We have some local Chinese restaurants that also have a no tip policy.
Besides, as pointed out earlier, tips are usually exempt from the law.

More important question:
If someone goes to a brothel, is it business or pleasure.


--
Peter

"J. Clarke" wrote in message
...
On 8/27/2010 9:45 PM, Peter wrote:
"John A." wrote in message
...
On Fri, 27 Aug 2010 18:29:07 -0400, "J. Clarke"

So basically now I have to keep track of how much I tip every server at
Friendlies on the odd chance that the aggregate tips to a given server
in a given year come to more than 600 bucks.

Can't we just all get together and shoot the politicians and
bureaucrats, burn the US Code and Code of Federal regulations, and
start
over? Only this time with a Constitutional amendment that they have to
carry a copy of each on their person at all times, in large print on
heavy paper, and be able to recite any bill verbatim from memory before
they are allowed to vote in favor of it?

I realize it's a lot to read and comprehend, but some things you
should do more than skim.

Among other things, tips are specifically excluded.

Aw! You ruined a knee jerk attack by stating facts. Is that allowed?

The politicians and bureaucrats still need shooting and the Constitution
still needs an overhaul to do away with the massive amount of legislation
with which we have been bombarded over the years.


Now that's an incisive comment.

--
Peter