Getting a Tax ID

[tukaniray]

So ... I have to ask ... as I am getting more and more into the Freelance world.

I work at a Studio 9-5 M-F ... and get my normal W2 and all.

But I have been doing Freelance for about 5+ years now ... both in Video and Photo.

But I am getting more and more work now as a freelance still Photographer ... so should I get a Tax ID now or later ...

Before I only got maybe 2 or 3 gigs in a year doing photography ... eh (I focused more on Video and Graphics ... they paid me a taxed check)

But this past year I hit 6-8 gigs in still photography. So ... should I get a tax ID and start using it to fund some equipment with a tax exemption and figure the 1099 later??

What you guys think? ... Or just keep where I am at in my side-PT-SemiPro Photog? ... and stay on the radar. ...... I fell bad doing that.

I need to re-open a DBA ...

-Ray-

[HeatherLou]

Get one, that way your covered and it is already done.

[J Eddington]

If you get paid for even one you need a tax id. The state will not like it if they find out :) It is really simple. and you can file online.

[toverman]

Yes. Lots of good info here: Sales Tax and Your New Business

Getting the ID isn't enough. Charge sales tax and remit it to the state, too.

[Wil_Bloodworth]

I got *into it* on the phone this morning with the State Comptroller's office. I don't normally go off on people over the phone but it was just ridiculous and I had had it with them. I didn't use any offensive language... no really. But she eventually hung up on me anyway. I was shaking for a couple of hours.

I HATE dealing with any kind of government formalitites. It's all BS and red tape is just stupid.

...SORRY to hijack your thread. Get a tax id now.

- Wil

[bondarnes]

I say don't get a tax ID and don't pay them. Then in a few years when someone turns you in, you will have to come up with six or seven years worth of back taxes out of your pocket, plus penalties, plus interest. I'm just kidding, but seriously, I know photographers this has happened to. One did sports teams for 12 years and when he got nabbed it was almost $8,000.00. The comptroller is really serious about his/her pound of flesh.

[thehatguy]

Originally Posted by J Eddington

If you get paid for even one you need a tax id. The state will not like it if they find out :) It is really simple. and you can file online.

My business is a Sole Proprietorship and a tax I.D. (EIN) is not required.

[TBoat]

Originally Posted by thehatguy

My business is a Sole Proprietorship and a tax I.D. (EIN) is not required.

I think they are talking sales tax #, Fed Tax ID # is something else altogether

[Sweet Caroline]

It's so easy to apply, and you would probably qualify to only file quarterly, which can be done online.

[toverman]

Originally Posted by TBoat

I think they are talking sales tax #, Fed Tax ID # is something else altogether

Right – no federal ID needed for sole props (no employees). State sales tax IDs are required for businesses that sell any tangible product/service within Texas, including photographers.

[tukaniray]

Thanks everyone ... and believe me I know about the getting hit later.

.... Lets just say coming out of the Art Institute 5 years ago ... nobody told me then ...

I went through a year as a freelancer ... and the tax people loved me ...

To give you an idea ... I have a monthly pull from my bank from the IRS ... and will take about 4-5 years to pay back ... yup what fun.

I know I need a tax ID ... I was just waiting to see how well I was going to do on the Photography side of Media. So ... I am going to get one and that's final.

Again, thanks everyone.

Oh one more question ... if I use other guys in some of my gigs ... like I get gigs where I need 2-3 people sometimes ... should I pull taxes out of the wages I give them as well??? Or just pay them and let them figure it out???

Thanks again everyone. I have a friend who is an accountant at one of the studios here in Houston ... I will ask her to help me get on the right track also.

-Ray-

[toverman]

If you contract someone to help out, then you aren't required (and shouldn't) be doing their taxes for them. If you actually hire them, that's when you need the federal ID# and then I'd recommend a payroll service or really good accountant to help you sort out all the details.

[tukaniray]

No it's all Contract. ... So then I should be okay.

Just like when I am a contract Freelancer for a gig ... most of the companies I freelance for don't pull taxes.

I just wanted to get you guys opinions. Thanks.

-Ray-

[ronocnikral]

i'm no cpa, but you may want to review the differences between a 1099 contractor and an employee.

freebie

hire a cpa. if you can't justify it on the business side, remember they can help with the personal side as well.

[FireHeart Photography]

Okay so the Texas tax code states that for photographers: S
ales of photographs are taxable. Photographs
can be made from film (negatives
or positive transparencies) or from digital
or electronic files, and sold as prints, on a
DVD, CD, digitally, electronically
or by any other medium.
All expenses directly related
to the production and sale of
photographs and billed to the
customer are subject to tax
regardless of whether the photographer
bills lump sum, at
an hourly rate, or by itemizing
each expense. Such expenses
may include travel, meals and
lodging while shooting on
location, costs of acquiring
props and models and “professional
services” in shooting
the photograph.
A photographer billing a client for sitting fees
must collect sales tax on the entire amount
charged for all services performed at the time
the pictures are taken (including the sitting fees),
whether the billing is lump sum or separated.
If the customer does not purchase photographs,
in any form, the photographer can refund sales tax -

Bottomline - Photographers have to charge sales tax for everything... and btw - if you buy a camera it's not tax free unless you plan to sell it to someone and collect the taxes...