Posts by filmTones

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filmTones says



IMO not being registered with a PRO can be a unique selling proposition. Some people are explicitly looking for tracks they won’t have to pay these extra royalities for.
It’s not the purchaser who pays the extra royalties, it is the broadcasters, and they are required by law to make these payments, the money is just being left on the table.
I see your point. But besides broadcasting, there are other applications like physical mass reproduction on CDs that are used for advertising. I used to work for a company specialized in this and 90% of our customers were looking for PRO-free music. Just my 2 cents though.

Thanks, I didn’t know that. In that scenario I don’t know who would be responsible for the PRO money. At any rate, it would be nice to have the ability to opt in or out of PRO registration.

227 posts
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  • Has been part of the Envato Community for over 2 years
  • Had an item featured on Envato Market
  • Sells items exclusively on Envato Market
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filmTones says

IMO not being registered with a PRO can be a unique selling proposition. Some people are explicitly looking for tracks they won’t have to pay these extra royalities for.

It’s not the purchaser who pays the extra royalties, it is the broadcasters, and they are required by law to make these payments, the money is just being left on the table.

227 posts
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filmTones says

Thank you, great new feature! :)

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filmTones says

Regular business expenses (as defined by the IRS) are included in your AGI: http://en.wikipedia.org/wiki/Adjusted_gross_income

Author fees are definitely a deductible business expense. If any subsidy is limited by reported revenue that’s a different story.

Thanks for this, it certainly makes more sense. I have seen other lists of allowable deductions to calculate AGI that are much more limited in that they don’t include deductions for business expenses, but I’m hoping this definition is the correct one.

227 posts
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filmTones says

For US authors: Anyone that is receiving health care subsidies through healthcare.gov should know that your eligibility for any subsidy is determined by your AGI or adjusted gross income, so if the “author fee” is included in the 1099 reporting, it will push your AGI higher and could lower your subsidy or eliminate your eligibility. The “author fee” is not deductible from your AGI, only a very few specific things are.

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filmTones says

From this document, section 3 page 22/92 http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/how_vat_works/telecom/explanatory_notes_2015_en.pdf

Some indicators suggesting that a taxable person takes part in the supply are listed below:
– Owning or managing the technical platform over which the services are delivered;
– Being responsible for the actual delivery;
– Being responsible for collecting payment unless the only involvement of the taxable person is the processing of payment;
– Controlling or exerting influence over the pricing;
– Being the one legally required to issue a VAT invoice, receipt or bill to the end user in respect of the supply;
– Providing customer care or support in relation to queries about or problems with the service itself;
– Exerting control or influence over the presentation and format of the virtual market place (such as app stores or websites) such that the brand and identity of the taxable person are significantly more prominent than those of other persons involved in the supply;
– Having legal obligations or liabilities in relation to the service provided;?xplanatory
– Owning the customer data related to the supply in question;
– Being in a position to credit a sale without the supplier’s permission or prior approval in cases where the supply was not properly received.
Notes – published 3 April 2014 29/92

Some conflicting info above, mostly not in Envato’s favor, though the statement about support is interesting..

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filmTones says

There’s something about this that’s so pink, it’s like how much more pink could this be? And the answer is none. None more pink.

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filmTones says

Congrats Pink! High five Phil, Nigel Tufnel in Spinal Tap!

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filmTones says

QUESTION:

Avoiding Double-Reporting Income (1099-MISC plus 1099-K)

We bill all our clients through credit cards, and the card processor sends us a form 1099-K report of all the income received.

But at the same time, many clients insist on also sending us a 1099-MISC for the work billed to that individual client.

So by reporting both the 1099-K income and the 1099-MISC income, we’re reporting a fraction of the income twice.

So to get the correct numbers, we’d have to either not report the 1099-MISC contributions, or incorrectly report the 1099-K contributions by subtracting out the 1099-MISC subset. Neither of these options seems legally correct.

What’s the best way to proceed here that will not lead to undue complication?

united-states taxes form-1099

ANSWER:

Your clients should not send you 1099-MISC if they paid with a credit card.

You can refer them to this text in the instructions for the form 1099-MISC:

Payments made with a credit card or payment card and certain other types of payments, including third party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-MISC. See the separate Instructions for Form 1099-K. By sending out the 1099-MISC, your clients are essentially saying that they paid you directly (check or cash) in addition to the payment they made with a credit card (which will be reported on 1099-K). In case of an audit, you’ll have trouble convincing the IRS that it didn’t happen. I suggest asking the clients not to do this to you, since it may cost you significant amounts to fight the IRS later on.

In any case, you report on your tax return what you really got, not what the 1099 says. If you have two 1099’s covering the same income – there’s no legal obligation to report the income twice. You do not have to pay twice the tax just because you have stupid clients. But you may have troubles explaining it to the IRS, especially if you’re dealing with cash in your business.

Link http://money.stackexchange.com/questions/29954/avoiding-double-reporting-income-1099-misc-plus-1099-k

227 posts
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filmTones says

That said, I’m quite surprised to see very few comments from US AudioJungle authors on this issue, because the Authors Fee reporting on 1099’s IMO has far more implications than many issues that have ignited passions across the board (badge sizes, for instance).

I was struck by the lack of input from US AJ authors as well considering it’s potential impact on them, especially the bigger sellers. (Maybe they know something I don’t know, since I’ve spoken out my sales have stopped rather abruptly… hopefully I’m just being paranoid.) The other problematic issue besides the reporting of more income than we actually receive is that if you are paid through PayPal, there is the real possibility of double reporting of 1099 income, because PayPal reports it as well. When the gross income the IRS sees from 1099’s doesn’t match your declared gross income, the IRS starts asking questions. Since many of us are self employed, we are already under increased scrutiny for potential audits. When the IRS gets involved, it’s not a matter of a phone call to explain the mix up… you are in for something that will drag on for months and probably go far beyond what the initial inquiry was about. Not trying to freak anybody out, but unfortunately I speak from experience.

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