Posted by CJ on 4/8/07 4:05pm
Msg #184205

Special Notary Tax Deduction.

This is my understanding: "Notary Fees" are not taxable. But other income is. We can charge "up to $10" per signature. That $10 is not taxable.

So, if you do a job with 6 notarized signatures, and you get paid $60 for that job, you don't have to pay taxes on that job.

But if you only notarize a Grant Deed, with 2 signatures, and you charge $60, then $20 is not taxable, but the remaining $40 is.

If the borrowers do not sign, then the whole trip is taxable.

What do you think?

Reply by Glenn Strickler on 4/8/07 4:17pm
Msg #184206

By "not taxable" means it is not subject to self-emplyoment tax (both sides of FICA). It is still taxable when it comes to normal income tax. If you are not sure, then see a tax professional or use a tax program such a Turbo-Tax or Tax Cut. It will ask the question as you progress through the process. You can search the IRS website for info...

Reply by DebbieT on 4/8/07 4:31pm
Msg #184209

It is only exempt from self employment tax.

Reply by Kimberly Kislak on 4/8/07 4:18pm
Msg #184207

What do I think? AUDIT, AUDIT, AUDIT n/m

Reply by Regal/NC on 4/8/07 4:28pm
Msg #184208

CJ,
Notary income is exempt from consideration for "Self Employment Tax". This includes all income derived from notarial acts performed only. So in your example, only $40 would be taxable for self employment filings if you completed the assignment. Whatever fee derived from the non-signing is all taxable. You R Correct!

BJ

Reply by thnotary_NY on 4/9/07 12:17pm
Msg #184293

Don't forget that all this is moot, it the earnings are less than the SE limit.

Reply by John_NorCal on 4/9/07 9:07am
Msg #184246

***If the borrowers do not sign, then the whole trip is taxable.***

If you get paid whether or not they sign, then you have taxable income. If you did 2-3, etc notarizations on this signing or anyother signing, then those fees ($10.00 per signature) are not subject to self employment tax, BUT they are subject to income tax. This is ALL income, the fees that are charged for any notarization, are the only things that are not subject to self employment tax.

Best advice to you is to see a tax professional at least until you get the hang of tax preparing.

Reply by MistarellaFL on 4/9/07 9:24am
Msg #184252

If the borrowers do not sign

and we do not get paid, how much can we legally claim on that as a loss?
Can we deduct the full amount if they cancel and the TC doesn't pay?
I have had more cancellations, no-signs in the last month than have had
in about 3 years. I am curious as to interpretations of this from tax pros.

Reply by Calnotary on 4/9/07 10:28am
Msg #184272

Re: If the borrowers do not sign

I am not a tax pro, but if you did not get paid, you claim "cero" deduction because you did not received any pay. Assuming your a "cash" acct method taxpayer.

Reply by MistarellaFL on 4/9/07 10:52am
Msg #184277

But can you claim a loss?

that is what I am interested in, and if you can claim the whole fee or just out of pocket expensives.

Reply by Susan Fischer on 4/9/07 11:58am
Msg #184288

Why isn't it a bad debt? n/m

Reply by CJ on 4/9/07 12:46pm
Msg #184299

So far, when I do a job, I keep track of it in Quicken.

I have a category for "Signers R Us: Notary", and "Signers R Us: Trip".

I print out all my signing services, and they break down all my notary fees, and all my trip fees per siging service.

I enter the TOTAL as my income, and then the "notary fees" when I get to the notary question in Turbo Tax. When I have talked to bona fide tax professionals, the few I have spoken with never hear that notary fees were exempt from self employment tax.

I "THINK" I am doing it correctly, and I have not gotten audited these past 5 years. But every year I get a letter from the IRS asking about it, and I send them a printout about Notary fees being exempt, as well as printout of all my notary and trip fees, and that's the end of it. But they are confused every year. Now when I do my taxes, I prepare that information and put it aside for the inevitable letter.

What do you think?

Reply by Kimberly Kislak on 4/9/07 10:01pm
Msg #184395

Cj
This tax season has been a long one, I apologize for my audit comment.
I think you are getting close to how your tax return needs to be filed. But, you have been audited every year (paper audit), I think if you just once, see a professional, you will not get that letter every year. Plus, you will see some of the deductions you might be missing. Just a thought.