Posted by Jo/CA on 4/1/08 7:13pm
Msg #241673

IRS Publication

Does anybody know the IRS code number for Self Employment tax regarding notaries?

Reply by OR on 4/1/08 7:20pm
Msg #241676

I use (999999 Unable to Clasifye) for 2 years and it work for me.

Reply by BrendaTx on 4/1/08 7:29pm
Msg #241680

http://www.irs.gov/pub/irs-pdf/p17.pdf

See page 88 of that publication where it mentions notary. As it says, you should then read the instructions on Schedule SE for the 1040.

Reply by Jo/CA on 4/1/08 7:36pm
Msg #241684

Thank you. You're awesome.

Reply by BrendaTx on 4/1/08 7:44pm
Msg #241686

Thanks, Jo. I learned a lot when I

went through the HR Block tax courses. They armed us all with "Pub 17". I think any notary with a little time on their hands should consider taking the course. It will give you a lot of insight.

Reply by Jo/CA on 4/1/08 7:48pm
Msg #241688

Re: Thanks, Jo. I learned a lot when I

I had my taxes done today and was shocked that an accountant I've trusted and used for my other business wouldn't know this. She said she has 3-4 notaries, including a relative, that she does taxes for and was very interested in finding out the irs number. Thanks again.

Reply by Linda_H/FL on 4/1/08 7:52pm
Msg #241689

I believe the code I used through TurboTax is 541199 n/m

Reply by BrendaTx on 4/1/08 8:00pm
Msg #241692

I think by "code" Jo means...

the law/code which she can take to her accountant and tell her to use the no SE Tax option for the notary income.

But thanks for the number. I was looking for that the other day.

Reply by BrendaTx on 4/1/08 7:54pm
Msg #241690

This is probably a fluke, Jo.

This isn't that common of a situation. Most of the time SE people pay their SE tax even if they don't have to so that they continue to pay into their social security accounts. Some accountants probably don 't even consider this because in reality, for our old age, by many folks' perceptions it's better to go ahead and build up those accounts for the future, IMHO.

She probably has done fine in the past. Notaries don't usually (well, back in the day of a plain notary public) make enough money using their stamps to give this much consideration. I never took the option of not paying SE. Just my personal opinion on my situation.

Reply by Elaine Sedlock on 4/1/08 8:47pm
Msg #241703

I talked to 3 tax professionals who didn't know about this

and one had 27 years experience. She and her husband together run 3 businesses as well. Another was from Amscot. I've already decided I'll probably take a course asap. Brenda has the right idea.

Reply by Pat/CA on 4/1/08 8:57pm
Msg #241705

That DOES NOT surprise me! n/m

Reply by Pat/CA on 4/1/08 8:56pm
Msg #241704

There is no IRS code number for SE tax - Please read

I'm also a tax preparer so I hope this helps everyone who needs this info.

The only business code needed for those who are sole proprietors and file Schedule C (Profit or Loss from Business) is on that schedule, not on the SE form.

If you choose to not include your notary fees for SE (social security tax) purposes, it is an adjustment made on line 3 on the SE form and here is the way you report that as per Schedule SE instructions:

Income and Losses Not Included in Net Earnings From Self-Employment

2. Fees received for services performed as a notary public. If you had no other income subject to SE tax, enter “Exempt- Notary” on Form 1040, line 58; do not file Schedule SE. However, if you had other earnings of $400 or more subject to SE tax, enter “Exempt—Notary” and the amount of your net profit as a notary public from Schedule C or Schedule C-EZ on the dotted line to the left of Schedule SE, line 3. Subtract that amount from the total on lines 1 and 2 and enter the result on line 3.

As for the Schedule C code there are numerous ones that can be used. Here's the only 3 I would use:

541990 - Other professional services (can be used for notary only or multi-business)
531390 - Other Real Estate activity (can be used by I would leave that to notaries who work
in a realtor office. JMO
561490 - Other business support services (similiar to 541990, really no difference)

Hope this helps.

Reply by BrendaTx on 4/1/08 9:06pm
Msg #241706

Re: There is no IRS code number for SE tax - Please read

Jo asked: **IRS code number for Self Employment tax regarding notaries**

Perhaps I read it wrong; I thought she was looking for the "rule" or something she could read regarding the notary income -- SE Tax not having to be paid on notary income. I didn't read it to mean she needed the business code.

Since the rules of the IRS are written as "IRS Code" that was what came to mind. I don't know the code number, but I do know that a starting place for this is Pub 17.

Reply by Pat/CA on 4/1/08 9:21pm
Msg #241709

HAHA! Maybe I read it wrong as I'm used to that also being

referred to as a code! But in reading the other posts my mind immediately went to the "professions code."

Well I hope my information will help someone before April 15th!

Also, Pub 17 is a very good resource (known as our "bible" in the industry). It is very broad however and when you need to get to specifics, it gives you the pub number to further pursue the understanding and application of the laws.

I would recommend Pub 334 - Tax Guide For Small Businesses" to anyone who is self-employed.

I would recommend getting the hard copy mailed to you from IRS.gov of both Pub 17 & Pub 334.

I tried to paste some links on here but they aren't working. Sorry!

Reply by Pat/CA on 4/1/08 10:52pm
Msg #241721

Is this the IRS code you need?

I think I misunderstood the original post... I really should stop working and surfing now!

Section 1.1402(c)-2(b) of the regulations provides that the term "public office"
includes any elective or appointive office of the United States or any possession
thereof, of the District of Columbia, of a State or its political subdivision, or of a
wholly-owned instrumentality of any one or more of the foregoing.
Section 1.1402(c)-3 provides that as a general rule, with exceptions not here
relevant, the performance of services by an individual as an employee, as
defined in Chapter 21 of the Code relating to the FICA, does not constitute a
trade or business within the meaning of sections 1402(c) and 1.1402(c)- 1.
Revenue Ruling 59-354, 1959-2 C.B. 24, concludes that services performed by
members of tribal councils in their capacities as council members do not
constitute "employment" for Federal employment tax purposes and, although
includible in gross income under section 61 of the Code, amounts paid to
members of tribal councils for services performed by them as council members
do not constitute "wages" where their duties appear to be similar to the duties of
a city council.