Sales Tax Question--NY Photographers

Vivid Visions

I am just starting to really begin to make some sales, and I have difficulty getting quick answers from my accountant and even the New York State Tax Bureau (that's what I get for asking a question during tax season, right? :rolleyes )

Anyway, I was hoping that someone who has been working in New York State a while would be willing to share what they do regarding sales tax. Do you charge sales tax on your service--that is the session fee--as well as the sale of the actual print and mat, frame, album, digital file?

I have been charging sales tax on all sales made, including the session fee, but someone mentioned to me that I may only have to charge on the sale of the actual finished product. For instance, if my session fee is $125 and then I sell $100 worth of prints, I only have to charge the tax on the $100.

I would appreciate any information veterans of the photography industry would be willing to share.

Thanks!:D

ian408

Different counties and different states have different tax regulations. Be
best to talk to a tax professional or county assessor in your area rather
than rely on the advice you receive here (not that it is incorrect but you
certainly don't want to find yourself in hot water over taxes).

Ian

Vivid Visions

ian408 wrote:

Different counties and different states have different tax regulations. Be
best to talk to a tax professional or county assessor in your area rather
than rely on the advice you receive here (not that it is incorrect but you
certainly don't want to find yourself in hot water over taxes).

Ian

Ian,

Thanks for the response. I wasn't planning to rely on the the info I received here, I was just hoping to get a sense of how other folks handled this--perhaps give me a bit more education before I went to my accountant--who told me she couldn't do any research until at least May 1. And, I haven't been able to get a live body on the phone when I called the tax bureau, plus the e-mail inquiry I sent 10 days ago hasn't even been acknowledged.

Sam

Vivid Visions wrote:

I am just starting to really begin to make some sales, and I have difficulty getting quick answers from my accountant and even the New York State Tax Bureau (that's what I get for asking a question during tax season, right? )

Anyway, I was hoping that someone who has been working in New York State a while would be willing to share what they do regarding sales tax. Do you charge sales tax on your service--that is the session fee--as well as the sale of the actual print and mat, frame, album, digital file?

I have been charging sales tax on all sales made, including the session fee, but someone mentioned to me that I may only have to charge on the sale of the actual finished product. For instance, if my session fee is $125 and then I sell $100 worth of prints, I only have to charge the tax on the $100.

I would appreciate any information veterans of the photography industry would be willing to share.

Thanks!:D

Try here;


Starting a Business in New York State

Vivid Visions

Sam wrote:

Try here;


Starting a Business in New York State

Thanks--I'll head over there right now.

ian408

Vivid Visions wrote:

Ian,

Thanks for the response. I wasn't planning to rely on the the info I received here, I was just hoping to get a sense of how other folks handled this--perhaps give me a bit more education before I went to my accountant--who told me she couldn't do any research until at least May 1. And, I haven't been able to get a live body on the phone when I called the tax bureau, plus the e-mail inquiry I sent 10 days ago hasn't even been acknowledged.

Too bad your city government isn't more responsive. Sam's pointer seems to
be a good start though. $5 says that if you owed them money, they'd
have plenty of time

Good luck in finding your answer.

Ian

System

this document lists services that are taxed and services that are exempt-

I would bet that if it's not mentioned at all it's taxed-

http://www.tax.state.ny.us/pdf/publications/sales/pub750_804.pdf

george

Vivid Visions

gefillmore wrote:

this document lists services that are taxed and services that are exempt-

I would bet that if it's not mentioned at all it's taxed-

http://www.tax.state.ny.us/pdf/publications/sales/pub750_804.pdf

george

George,

Thank you for the link. This is the type of info I had been looking for, and in fact it does specifically mention the sale of artistic items such as sketches, drawings, paintings and photographs, but it doesn't say anything about the services of the photographer.

You are probably right, though, that if it doesn't specifically mention photography services, then it probably is taxable. Otherwise, aA great way to circumvernt the requirement to charge sales tax would be to charge a high fee for the photography service, and include the prints at no additional charge.

Until I get the right answer from a Tax Professional, I will continue to charge sales tax on all sales, including the session fee.

Thanks to everyone--I really appreciate the help.

System

well, all I can say is that thank goodness you are a responsible citizen who gladly transfers her good hard earned money and the monies of her clients to the state so that the institution of that great sovereign government can endeavor to take care of those who don't do as you do-

have a good week-

george 'read my lips; no new---

oh sorry, wrong one-

Vivid Visions

gefillmore wrote:

well, all I can say is that thank goodness you are a responsible citizen who gladly transfers her good hard earned money and the monies of her clients to the state so that the institution of that great sovereign government can endeavor to take care of those who don't do as you do-

quote]

Actually, I'm too pretty for jail, and I don't have the money pay a lawyer to keep me out!

System

oh--

that works too-

have a good week and I hope you get it figured out-

george

Angelo

Judy - I believe your assesment is correct and probably true in most states.

As an example, in CA, where I often do design work, I can charge clients anything I want and advise them of anything and direct them to do anything and consult with anyone they want me to on their behalf and keep on racking up the bucks and never charge them sales tax. However, the minute I put anything on paper (blueprints as an example) thereby creating a tangible commodity, I have to charge them sales tax.

If I'm charging a $10,000 design / consulting fee and line item $250.00 for blueprints then I tax the $250. at 8.25% (LA County)

If I choose to charge them $1.00 for the blueprints then that's the amount to which I apply tax.

Same with photography; the shooting is tax free, the prints (or disk) are taxed.

All of this is predicated on the notion that as a part of your business license you also have a seller's or resale permit and made your original purchases of raw materials such as photo paper and ink, tax exempt.

Vivid Visions

Angelo wrote:

All of this is predicated on the notion that as a part of your business license you also have a seller's or resale permit and made your original purchases of raw materials such as photo paper and ink, tax exempt.

Yeah, I have the resale permit, and make the purchase of the raw materials tax exempt whenever possible, so I'm ok there. I just hate the thought that I am overpaying on the sales tax, especially when I am charging $1500 for a wedding package (including the album and prints), and I am also charging tax on the whole shebang.

Thanks for your comments...that kind of first hand experience thing is exactly what I was hoping for. And, it seems that the only state with more sales tax loopholes and rules than New York is California, so perhaps I am on the right track.

Thanks again.

Vivid Visions

Finally got my reply
Well someone from the tax bureau finally got back to me--by phone. And the answer to my $64,000 question is that ALL photographic services are taxable, including the session fee and the prints that follow.

Now if I can just find that wet noodle for the "friend" who told me that the session fees are not taxable for sales tax purposes, so I can thank him properly for sending me on this wild goose chase!

Angelo

Vivid Visions wrote:

Well someone from the tax bureau finally got back to me--by phone. And the answer to my $64,000 question is that ALL photographic services are taxable, including the session fee and the prints that follow.

Now if I can just find that wet noodle for the "friend" who told me that the session fees are not taxable for sales tax purposes, so I can thank him properly for sending me on this wild goose chase!

Wow, that seems so wrong. I wonder if a plumber's time is taxable? Are haircuts taxable? Are bartender or caterer services taxable?

<edit> I just read through the tax guide you posted a link for. The list of taxable services and tangible property begins on page 17. Photography is NOT a listed service. Photographs are listed as tangible.

Sam

Vivid Visions wrote:

Well someone from the tax bureau finally got back to me--by phone. And the answer to my $64,000 question is that ALL photographic services are taxable, including the session fee and the prints that follow.

Now if I can just find that wet noodle for the "friend" who told me that the session fees are not taxable for sales tax purposes, so I can thank him properly for sending me on this wild goose chase!

I agree with Angelo. This dosn't seem correct. Get the state sales tax manuals. They should be free. Read them. If you are in business you need to know exactly what those laws, policies say, word for word. Do not rely on a verbal statement from someone on the phone.

You need to do due diligence. It's real easy for the person on the phone to give the safe answer. When you ask if (insert product / service here) is taxable. The easy, and safe answer for them is YES!

Try calling an established photography shop. Be honest and tell them who you are etc, and see what the existing people are doing.

Sam

Vivid Visions

Sam wrote:

I agree with Angelo. This dosn't seem correct. Get the state sales tax manuals. They should be free. Read them. If you are in business you need to know exactly what those laws, policies say, word for word. Do not rely on a verbal statement from someone on the phone.

Try calling an established photography shop. Be honest and tell them who you are etc, and see what the existing people are doing.

Sam

Sam & Angelo,

I definitely agree that I need to do more research, but in the meantime, I want to do whatever is necessary to keep me in compliance. The last thing I need as I am starting up is problems with the taxman.

I have a copy of the sales tax guide, but the problem is that photography services (not the printed image), are not named as specifically exempt or as specifically taxable. So, in the end it will be someone's opinion (educated though it may be) that I must rely on.

I will definitely call other photographers in the area, that was in my mind also.

Thanks for the input. I'll keep you posted.

Shay Stephens

In New York, you have to charge sales tax on the whole kit and caboodle when it comes to photography.

I got the same response you did over the phone.

If customers complain, I send them to talk it over with the good people in Albany who are imposing it.

Vivid Visions wrote:

Sam & Angelo,

I definitely agree that I need to do more research, but in the meantime, I want to do whatever is necessary to keep me in compliance. The last thing I need as I am starting up is problems with the taxman.

I have a copy of the sales tax guide, but the problem is that photography services (not the printed image), are not named as specifically exempt or as specifically taxable. So, in the end it will be someone's opinion (educated though it may be) that I must rely on.

I will definitely call other photographers in the area, that was in my mind also.

Thanks for the input. I'll keep you posted.

Vivid Visions

Shay Stephens wrote:

In New York, you have to charge sales tax on the whole kit and caboodle when it comes to photography.

I got the same response you did over the phone.

If customers complain, I send them to talk it over with the good people in Albany who are imposing it.

Thanks, Shay.

Do you remember that guy who owned the Oak Beach Inn with his huge billboard truck telling everyone to leave New York before it's too late? I'm beginning to understand what he was talking about.

Thanks again.

jenniferphoto

Hi Judy,
Are you still paying sales tax in NY for all services (I see that post is from 2006)? How do you handle the different county rates? Do you just charge the rate in your county and reconcile later? I'm just starting and NY is NOT making this easy!!!
Thanks!
Jen

ColoradoSkier

Vivid Visions wrote: »

Actually, I'm too pretty for jail, and I don't have the money pay a lawyer to keep me out!

Amen, that's why I pay sales tax too. But at least here services are not included in sales tax calculations (like my time to take the picture).