Wow! It still amazes me what you people have questions to. It is always the same thing: Invoices and taxes. I don’t know who is searching for this info, but I do have access to some basic data related to my blog, like what search words you used to get here and how long visitors stayed on certain pages.
Each week, with the use of this data, I can put together a simple list of what topics were most important to you all. Every week seems to be the same topics: Invoices and taxes. Yup, I could say it again and you would probably love it… well, I’ve decided to give a sort of yes/no faq today.
Most searched was about sales tax for Dallas photographers: Yes, you are REQUIRED to charge sales tax for the majority of your customers. You had better collect it, too. If you are doing this as anything more than a hobby, the government will know. Trust me. I have a friend being audited right now. Luckily, her photo business is run like a top, so she’s safe.
Who doesn’t have to pay sales tax? Out of state customers are one example. Someone in New York may see one of your prints and set up to pay you for a copy. You mail that copy out of state and you don’t mess with collecting state sales tax. They come to Texas and pick it up? Then you collect sales tax.
Who doesn’t have to pay sales tax? Businesses who have a Texas sales and use tax permit AND who are using your service/product in something they are reselling (and ultimately collecting sales tax from and end user for that final product). In other words, I am shooting for the local newspaper. The pay me to take a picture, then they use that picture for their final product – the actual newspaper. They deal with tax, not you. If they have a tax permit and are planning to resell your work, they are good.
Who doesn’t have to pay sales tax? Charitable and/or religious entities that are registered with the state. There are certain restrictions here as well, so don’t just assume that tax should not be collected, because you are shooting for a charity or church.
The next highest search was about a photographer’s invoice. Well, I already detailed that in an earlier blog. I’ll add a search feature to this blog soon, so you can easily find that entry.
The next biggest search was about w-9 forms. In simple terms, this is the form you fill out as a freelance or contract worker. You client will let the IRS know that you were paid X dollar amount over the full year and that you will be reporting this income on your return. You should report ALL income no matter what, but if you filled out a w-9, you better make SURE you reported it! They know about it.
In turn, if you hire a photo assistant a bunch, racking up (I think) $600 or more in deductible fees, you are supposed to have them fill out a w-9, then you file that (or have your accountant do all that messy, non-artistic stuff like filing and deducting).
I think this is enough info for now. I’ll try to address some of the other frequently asked questions later. But I have to get back to work. I have a couple invoices due to clients by tomorrow morning… Oh, and by the way – Don’t take this as the final word. If you REALLY want to know about this stuff, go here for the definitive answer: www.window.state.tx.us