here's a brainteaser for you... (tax question)

[pippin]

How on EARTH would you do this?

1. I'm shooting a fundraiser for a church.
2. I'm charging them for sitting fee only.
3. From there they want to order reprints from me.

Now. I do not have a tax ID (nor am particularly interested in getting one, but I will if I must - since I do every other print sale through exposure manager for this reason). But since this is a fundraiser, they want to order reprints through me, but in order for me to get them done here in dallas (since I work in a lab ya know), my store would charge me sales tax on the prints I purchase.

But, in order for me not to be charged tax, I would need to apply for a tax id number so I don't pay sales tax.

But here's the problem. This is a church, so they're tax exempt anyway. So I'd be applying for a tax ID to buy a product that I'm going to sell to someone else, but they're tax exempt. How on earth would you explain that one to an auditor?

Confused yet? If not, tell me what I should do?

My darling husband has told me I should just tell them that I will not sell them the prints, but they can certainly order prints through my work so my work can deal with the tax stuff.

Any suggestions? I know I have to deal with the tax ID and all that, but I'm going to do that at the beginning of the year as apart from dealing with exposure manager that my customers deal with and then exposure manager cuts me a check at the beginning of the month, I don't really sell products.

[Steelsun]

very murky ground here - consult an accountant. This is the kind of thing the State Comptroller loves to look for to get their money.

Unless you are making more than a few hundred dollars in prints at your store, than the sales tax will be minor anyways. I'd just pay it and eat the costs.

[pippin]

thats why i'm not in the mood to draw attention to myself and apply for a tax id for this one purpose. I'm not even expecting to see any reprint orders anyway - mainly because I've seen the previous year patterns and there may be a few dollars here and there but not alot.

[BCPhoto]

Not quite sure this is the answer you're lookinng for....have them sign a right-to-use license, pay you a "consulting" fee and hav them print their own pictures without you...??? Otherwise, I agree with Steelsun..consult an accountant.

[CobyPhoto]

Lisa,

You have two options...1.) Just do as Brian said and eat the sales tax...or 2.) get the Tax ID since you are planning on doing it later on and just be legal.

I know it is screwy, but just because the Church is Tax Exempt (Make SURE you get a copy of their tax exepmpt status for your files if you do not charge them tax!!) that does not make your purchase of the prints from the lab tax exempt.

Just out of curiousity, why the worry about the Tax ID? The only draw back in having one, is that even if you have NO tax to pay, you have to file a no tax due return. (It can be done over the web with one or two clicks of a button thou.)

If you do choose the no Tax ID route...juswt pay the sales tax to the lab, get a copy of the Tax Exempt status from the church for the prints you sell them and don't charge them tax. IF ever audited, they would probably chastize you for not having a Tax ID...but they couldn't fine you as you PAID your sales tax on your purchase. You don't stand much chance of getting audited.

Bottom line...my best advice and that of any accountant worth his salt: Get your Tax ID and be legal. If you ever are audited, you will be thankful you made the decision to be 100% legit and not in the grey.

CJ

[Pikachu]

How about this: The work goes through the lab under the name of the church. They pay for it directly using their tax ID. You merely act as a courier for this part of the transaction.