Posted by kathy/ca on 8/10/10 10:06pm
Msg #348440

Why do so many NP's like doing general notary work more

than loan signings when loan signings are more lucrative? Curious to see what my fellow notaries think.

Reply by Roger_OH on 8/10/10 10:26pm
Msg #348444

Unlike many who saw having a notary commission only as a required hoop to being a signing agent, many others became notaries to actually defend the public trust, deter fraud, and execute the responsibilities of the office as they have been practiced for over two thousand years.

In other words, holding a notary commission can indeed be the basis of a lucrative business, but IMHO, providing service as an officer of the state goes way beyond the money aspect.

Reply by 101livescan on 8/11/10 12:05am
Msg #348452

cuz there's no document drama, no people drama, no LO drama, no escrow drama and you're in and out in no time. Lots easier, no edocs on the run, causing you run late for the rest of the day.

No brainer! I love straight notary work.

Reply by JanetK_CA on 8/11/10 1:26am
Msg #348456

Bingo! And paid on the spot, so no invoicing or collections! n/m

Reply by Marian_in_CA on 8/11/10 2:19am
Msg #348459

Exactly!

In California, we just have to be very careful that we distinguish "Notary Service Charges" from "Mobile Service" charges.

Also, when I do jail and court runs... I consider it a flat "Mobile Service" at an hourly rate and I do not charge extra for anything -- notarizations, printing, shipping, phone calls, faxes, etc -- it's all paid for by an hourly rate... and if I do any notarizations, I itemize them with a "No Charge" on the receipt/invoice.

Right now, my biggest income generator are calls to the local Immigration Detention Center. I swear I've been out there 10 of the last 14 days... and I'm going back out there again tomorrow. Honestly... I love it and I would do that over loan doc drama any day.

Reply by Art_MD on 8/11/10 7:35am
Msg #348469

Re: Exactly!

Marian,

If you list notarization at no charge, aren't you losing out on the ability to exempt $10/notarization from SE tax? Shouldn't you list all notarizations at the $10 rate to save the 15%+ SE tax?

Art

Reply by PAW on 8/11/10 9:15am
Msg #348484

Re: Exactly!

Yes, Art, by not listing any "notary fee", the SE Tax exemption couldn't be taken. However, there are reasons NOT to exempt the notary fees from SE taxes, especially those who are full-time self-employed persons. One must weigh the benefits and drawbacks of the SE tax exemption.

Reply by Calnotary on 8/11/10 10:19am
Msg #348495

PAW...

I had this same question last year. Are we obligated to take the exempt from SE tax or it's an option to take the notary fee exempt from SE tax. John was not very clear on this, any other EA here that could answer this dilema?

Reply by PAW on 8/11/10 10:21am
Msg #348496

Re: PAW...

You are not required to take the exemption. If you need to build Social Security credits, then you may not want to take the exemption and pay the full SE Tax.

Reply by Marian_in_CA on 8/11/10 10:39am
Msg #348497

Art, you're right... but I've decided not to take

the exemption for SE tax. I've explained here before.... and as PAW said, it's an individual decision.

The biggest secret about taking the exemption is that you are also not giving yourself any Social Security credits.... which can reduce potential benefits in the future. More importantly... and this is what I think most people *really* don't realize --- is that if you become disabled and find yourself needing to rely on SSDI.... the government only looks at your most recent SS credits in order to determine your benefit. And if you haven't paid in recently, you may get little or nothing.

TO me, it's not a great savings on the SE tax to compensate for the potential benefits of the SS insurance.... especially in the event of a disability. Retirement? Eh.... I'm 35, so that's a looong way off. But, I came to my decision through personal experience because my husband was injured and became disabled as the result of a motorcycle/vehicle accident. It took years and I learned a lot about what those Social Security credits really mean. My husband worked in a job at a University and was exempt from paying in to Social Security. We were young and dumb at the time and just thought that was great because it meant more take home pay for us as poor college students. Well, it may have saved us a couple of hundred dollars at the time, but when he was going through his disability claim?? It cost a WHOLE lot more. He was actually initially denied outright for lack of work credits, even though he'd been working the whole time! He had to appeal and go to court... with a lawyer. They eventually worked out a reduced benefit... but it was an eye opener for me and he took a HUGE hit in the amount of benefit we thought he was going to get. Being exempt from paying in to Social Security is not always a good thing.

And, because of chronic health issues I've dealt with my whole life and as the result of a recent majorly surgery that I went through... I am at a higher risk of becoming permanently disabled myself before retirement. I'm hoping that never happens, of course... but the risk is there.

So, because of it, I've decided the SE exemption just isn't worth it for my situation. If I'm ever in a position where I'm comfortable enough to not need to rely on SSDI if I'm disabled, then I will certainly revisit that idea.... but for now? Nope. I've even had 2 different accountants tell me I was doing the right thing.

Reply by Susan Fischer on 8/11/10 2:26pm
Msg #348515

True, Marian, I've claimed notary income for SS every

year, as accumulation of those credits were important to me. Makes a big difference when you need it most.

My CPA agrees as well.

Reply by taxpro on 8/11/10 7:49pm
Msg #348546

You're a smart gal, Marian...

My primary practice is accounting and tax preparation, although I have a lively notary business mostly doing loan signings during the off-season, but anyway.....I've had many tax clients who unfortunately found themselves in a position of having to file for disability, and were denied due to lack of credits. They found out that SE tax isn't such a bad thing. Yes, I fully realize that I could take that money and save it myself, and would probably do better than the SS Administration does with it. But the truth is...most people just don't save their money! Look at all the refinances you are doing for people in their late 50's and 60's! Their homes should be paid for by now (ours is), but they're starting over with new 30 year loans! What's up with that? I realize people fall on hard times, but in general, we have become spoiled, spending everything we earn. Americans, in general, have not saved for retirement as we should have.

I have several minister clients who "opted out" of SE tax when they were younger, and now that they're approaching 60, they're getting worried because they haven't saved like they thought they would. Who will they turn to for help? I guess they'll never be able to retire.

I am almost 56. At one time, my husband and I thought that Social Security would not be around by the time we retired. Now that we're within a few years of being eligible for SS benefits, we think differently. We know that the SS system is going to be suffering, and there will probably be some changes made to it, but we do expect to receive benefits. Also, we realize that either of us could become disabled at any time, whether it's an accident or an illness, and understand the importance of keeping our earnings record current with enough earnings to (at least) earn your 4 quarters per year.

Marian, I admire your maturity at age 35, that you realize this. I can tell you that this was the furthest thing from my mind when I was 35. Kudos to you!!

Reply by taxpro on 8/11/10 7:29pm
Msg #348544

SE Tax on notary work

I'm an EA (Enrolled Agent). You are not required to exempt your notary fees from SE tax, although most of us would find that advantageous. However, if you haven't accumulated enough credits (40 quarters, $1090 per quarter in 2009) to qualify for social security benefits, or you want to boost your earnings to increase your benefits, there is a provision to "opt in" to SE tax, even if your net income from self employment isn't enough to pay SE tax otherwise. Also, keep in mind that in order to be eligible for social security disability, your earnings must be fairly current, depending on your age. I won't bore you with the different requirements for different ages. You can probably get this info at www.ssa.gov.

To Opt-in to SE tax (when you aren't otherwise required to pay it) you would use the Non-Farm Optional method, and it's computed on Page 2 of the "long" Schedule SE. You may want to do this if you haven't had a consistent record of earnings for Social Security purposes. This gives you credit for $4,360 of SE earnings (using the 2009 figures), which is equivalent to the $1,090 per quarter requirement. That would also give you earned income for purposes of the Earned Income Credit, if you're eligible for that. Naturally, you have to pay SE tax on the amount reported, and the use of this method is limited to 5 years. You also must be regularly self-employed, which is defined as having net earnings from self-employment of at least $400 in 2 of the 3 years preceeding the year the non-farm method is used. The 5 years of the non-farm method use do not have to be consecutive, though. I hope this helps.

Reply by PA_Notary_II on 8/12/10 9:19am
Msg #348595

Since we're on the subject, taxpro....

I'm currently drawing SS benefits and still doing Notary work...general and NSA . Is there any valid reason I would NOT want to take the exemption?

Reply by PAW on 8/12/10 2:16pm
Msg #348660

Re: Since we're on the subject, taxpro....

I too am drawing SSA benefits. When I applied, I was told that there was no further reason to not take the exemption, since my benefit was already calculated and "in play". Just be aware of the earning limits that may be in force.

You can continue to work and still receive retirement benefits. Your earnings in (or after) the month you reach your full retirement age will not reduce your Social Security benefits. However, your benefits will be reduced if your earnings exceed certain limits for the months before you reach your full retirement age.

Here is how it works:

If you are younger than full retirement age, $1 in benefits will be deducted for each $2 in earnings you have above the annual limit.

In the year you reach your full retirement age, your benefits will be reduced $1 for every $3 you earn over an annual limit until the month you reach full retirement age. Once you reach full retirement age, you can keep working, and your Social Security benefit will not be reduced no matter how much you earn.

If, during the year, your earnings are higher or lower than you estimated, let us know as soon as possible so we can adjust your benefits.

If you want more information on how earnings affect your retirement benefit, ask for How Work Affects Your Benefits (Publication No. 05-10069), which has current annual and monthly earnings limits.

http://www.socialsecurity.gov/pubs/10035.html

Reply by taxpro on 8/12/10 5:52pm
Msg #348741

Re: Since we're on the subject, taxpro....

Obviously, you are already eligible for benefits, so you don't need to worry about earning your 40 quarters at this point. So I'd take the exemption if I were you.

Reply by James Dawson on 8/11/10 2:44am
Msg #348461

I would not make it if it weren't for General notary work. It isn't a financial issue for me but rather a "service" issue. Being paid on the spot for something that the patron needs urgently is rewarding in itself as well a profitable if you advertise properly and make yourself available.

So many people, low income people are held hostage to ignorance and fear of not knowing what to do that they simply let basic things go, unattended.

I do free notarization once a week at a Senior Citizen Center just to combat this phenomenon. Deceased family members still on title, retirement disclosures, medical directives, section 8 vouchers, rent affidavits are but a few things that can disrupt a Senior's life.

With loan signings, you leave the location wondering if you're going to get the kiss you deserve and whose going to give it to you!

Reply by Marian_in_CA on 8/10/10 10:31pm
Msg #348445

It's not more lucrative for me....

On the whole, I earn FAR more doing general notary work than I do on loans. With general work, I can meet with more people, shorter appointment times and most of the time, no printing or haggling with other companies -- plus I usually get paid in cash on the spot... no waiting 30-45 days for a check that may or may not show up.

Loan work involves too many phone calls and companies who want to negotiate down...

I took 5 potential loan calls today... none of them panned out because I quoted them a fee that was too high. And yet, I took 12 calls for general work... and 10 of the 12 ended up with cash in my hand. No waiting, no fuss and a lot of happy people. It was good, busy day.

In my area, there are a couple of NSAs who I *KNOW* are taking loan assignments at $65-$75 a pop. I'm not going to try to compete them. I'll still take loan work... but it's becoming less and less lately because I won't compromise my fees - and will not work for free. And no, to me... it's just not worth taking those low fees and not getting for at least a month. It just doesn't add up like some people seem to claim it does.

Besides, I'm a lot happier doing general work, too. I meet so many different nice people -- even some not so nice ones... but it's just more interesting to me in general.

Reply by LynnNC on 8/10/10 11:17pm
Msg #348448

At $5 per notarization and no travel fees in NC...

...general notariztion work is not for me!

Reply by Alz on 8/10/10 11:29pm
Msg #348449

In CA its $10 per notarization plus travel fees...

...works great for me. Granted it may take more appointments to obtain the equivalent of a signing appointment, but cash on the spot works better than the net 30, 45, 60, etc.

Reply by JanetK_CA on 8/11/10 1:30am
Msg #348457

Re: In CA its $10 per notarization plus travel fees...

Actually, it's better than that: $10 per signature notarized. Travel fees aren't addressed at all, so no limitations or prohibitions - aside from fairness and good business sense.

Reply by Bob_Chicago on 8/10/10 11:47pm
Msg #348450

$5 per notarization and no travel fees is $4 more than

I can charge ( IL law is silent on the the issue of travel fees)
Only General Notary work that I do is pro bono

Reply by Cari on 8/11/10 9:08am
Msg #348483

Yes signings are more lucrative, but due to damn near extinction of loan closings, for some general notary is survival.

In my neck of the woods for example, due to new notarial laws, general notary business has actually BOOMED. Its been very $$ beneficial to be of service in that area.

Reply by LKT/CA on 8/11/10 5:01pm
Msg #348526

Like the others, general notary work is more lucrative for me than loan signings. Nothing to print...I just show up, notarize and I'm finished in 15 - 20 mins. Up to three general notary service calls is the equivalent of a $150 loan signing. My average appointment pays $40 - $50. I definitely like the cash (or check) paid immediately for notarial services rendered.

Reply by SheilaSJCA on 8/11/10 11:33pm
Msg #348568

And its even better when its steady every week. I love it when I get to do at least one or two trust or other multi-signature transactions per week. Last friday I met one of my regular clients to notarize patent assignments with 3 signers, 9 signatures total, $30 travel fee, for a grand total of $120, paid on the spot. I was in and out in 20 minutes.

Reply by SheilaSJCA on 8/11/10 11:34pm
Msg #348569

what's not to like? n/m