If you are doing closings & receive 1099s, you are not just generating income from Notary Fees, as the payments you get are not based on how many notarizations you do during a signing. If your notary income is GNW, just notarizing for customers who come to you, the fees are exempt from SE tax. What is it? I believe that income from closings is fully reported, as it it to the IRS, and included on your Schedule C together with your business expenses, mileage, etc, and that you should be able to fund and IRA or 401(k) up to the amount you earn.
The NNA summarizes:
Mobile Notaries must carefully itemize notarial versus non-notarial fees from loan signing assignments. If you are a self-employed Notary Signing Agent, IRS Publication 17 states that you must pay self-employment tax if you had net earnings of $400 or more from fees for services other than notarizing documents (for example, traveling to a signer’s home, delivering completed loan document packages, etc.). Any income falling into this category must be declared on an IRS Form 1040, Schedule SE for self-employment tax purposes.
It may be possible to compute how much of each closing is fees for notarizations, but is it really worth the time to do this, particularly since that is not the basis of each fee jus to safe some SEtax?
If your CPA is treating your income from closings entirely as notary fees, I do not believe this is correct, and may be based upon a misunderstanding of what you do. |
