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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 |
#2
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New reporting requirements for professional photographers
"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 |
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New reporting requirements for professional photographers
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? |
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New reporting requirements for professional photographers
"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 |
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New reporting requirements for professional photographers
"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 |
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New reporting requirements for professional photographers
"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 |
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New reporting requirements for professional photographers
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 |
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New reporting requirements for professional photographers
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. |
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New reporting requirements for professional photographers
"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 |
#10
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New reporting requirements for professional photographers
"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 |
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