Contract Question....sorry it's long!

[Rick99]

Hi Everyone, I have a unique situation that I need help with. Long story short, I have someone who I met that has a business that umbrellas different branches under it....Computer graphic design, Music Recording, Music Lessons, Voice Lessons and Photography. The Owners are a married couple in their early 30s and are musicians by heart who perform weekly and have worked on recording projects for big artists and the Disney Channel. Currently, the husband has connections with Modeling agencies due to his music background and such. The modeling agencies are sending him all of their clients to do their headshots. He is also getting recurring business from those same people to shoot family portraits and engagement pics , etc.... Ok with that said, he hates it ...LOL... He loves the business side but he is a musician at heart and wants to step out as Photographer so he can focus on recording music and he wants me to do the photgraphy part for him. He is looking at a 50/50 split with me using his place of business and lights. All I am doing is taking the pics, small post processing and the "picked" pictures are being sent out to a professional retoucher. So here's my question, it's too soon to jump in as a partner as I do not want that yet until I see how we do. He wants to 1099 me for all work. He doesn't care about the copyrights being shared as he wants to put them on his site and he said he wants me to be able to do the samething as well. It seems like a great opportunity but I want to make sure my liability is covered and we have a contract in place. Can anyone share with me a contract template? Is this considered a work for hire situation? Do I need to file anything in order to do this kind of work as I do not currently have a business license or anything as this has just been a hobby I have done for a longtime. Thanks for reading and all help is greatly appreciated!

 

[Designer]

Splitting the proceeds with him sounds odd to me. How much direction does he allow himself? Who collects the money?

As to whether you need a license is up to your local municipality. Call them.

Speaking of liability, who is the insured?

At the very minimum you will be required to include the income from this venture on your tax returns, Federal, and state, if that applies. If you were an employee, you just file a return just like any other employee, and he picks up the employer's contribution. As a contractor, you will be held responsible for paying the full amount of FICA on your own. I'd look at the numbers before jumping into this.

Speaking of jumping in, we're not lawyers, but you can find one in the yellow pages. Do that. If your attorney writes the contract, it will most likely benefit you more than him, but vice-versa.

 

[Rick99]

Splitting the proceeds with him sounds odd to me. How much direction does he allow himself? Who collects the money?
As to whether you need a license is up to your local municipality. Call them.
Speaking of liability, who is the insured?
At the very minimum you will be required to include the income from this venture on your tax returns, Federal, and state, if that applies. If you were an employee, you just file a return just like any other employee, and he picks up the employer's contribution. As a contractor, you will be held responsible for paying the full amount of FICA on your own. I'd look at the numbers before jumping into this.Speaking of jumping in, we're not lawyers, but you can find one in the yellow pages. Do that. If your attorney writes the contract, it will most likely benefit you more than him, but vice-versa.

thanks for the reply. He is supplying ALL the leads/ Business. He is willing to split the proceeds. I'm walking in to something I could not generate myself. He right now is going to make me money I am not and could not on my own. With that said, I am taking pictures/headshots. It's barely any direction by him at all. I'm shooting a decent amount of shots. Turning them in for client review and they pic the one(s) they want. We than send them out to be retouched and printed and that's it. I still can generate any of my own business and he wants no cut on that. I know I have to claim taxes at the end due to the 1099. We have a flat rate we charge for the sitting and than additional charge per look. So I know what's being charged before each shoot and it is I who am benefiting in my opinion more than he will be. My main question was do I need a business license as I am not technically his employee but a contracted worker. Second question, I want to make sure we have a contract/working agreement written and I was hoping someone may already had a template available we could follow and change where needed.

 

[Designer]

I suppose it's my fault for not providing a couple of pages of highly-detailed text to answer your questions.

So lemme try again:

My note of response was intended to make you think, but apparently it was utterly wasted. My questions are to get you thinking, not because I want to know. The reality is; I simply don't care what you do, but I thought you might have wanted some direction. I offered my comments in full faith that what I was addressing was your situation overall, not the minutiae of details.

Your second post plainly shows your nearly complete lack of any knowledge of business, taxes, and licensing. If you don't wish to take my advice, WTH, I really don't care.

Since you apparently did not read my first response, I have done the hard part and shortened it to just a few words:

Your main question: "..do I need a business license.."

My answer: Call the city.

Your second question: "..template available.."

My answer: Find a lawyer.

Let's hope that was clear enough, because if you ask me to repeat again, I am liable to be put off.

 

[Rick99]

I suppose it's my fault for not providing a couple of pages of highly-detailed text to answer your questions.

So lemme try again:

My note of response was intended to make you think, but apparently it was utterly wasted. My questions are to get you thinking, not because I want to know. The reality is; I simply don't care what you do, but I thought you might have wanted some direction. I offered my comments in full faith that what I was addressing was your situation overall, not the minutiae of details.

Your second post plainly shows your nearly complete lack of any knowledge of business, taxes, and licensing. If you don't wish to take my advice, WTH, I really don't care.

Since you apparently did not read my first response, I have done the hard part and shortened it to just a few words:

Your main question: "..do I need a business license.."

My answer: Call the city.

Your second question: "..template available.."

My answer: Find a lawyer.

Let's hope that was clear enough, because if you ask me to repeat again, I am liable to be put off.

Uhmmmm...let me think what happened here? Your nuts and your reading comprehension is very limited. I thanked you for your response and was trying to make sure I was clear enough and tried to expand on my original post. Do us all a favor and go have a drink and don't respond to anymore of my posts. Thanks for your time. For the record, I am a Financial Advisor and taxes, investments, and insurance is my specialty and understand the tax laws very well. My main question was, do I need a business license to do this or not? I asked here because I have yet to contact my attorney ans was trying to see what other photographers are doing in this situation.

 

[Designer]

For the record, I am a Financial Advisor and taxes, investments, and insurance is my specialty and understand the tax laws very well. .

LOL!

 

[Rick99]

For the record, I am a Financial Advisor and taxes, investments, and insurance is my specialty and understand the tax laws very well. .

LOL!

Hey look...that was the same way I felt when you answered my original post....what a dope!

 

[Braineack]

youre a financial advisor but don't know how to answer the simplest of tax liability/personal income earings questions for yourself?

 

[Rick99]

youre a financial advisor but don't know how to answer the simplest of tax liability/personal income earings questions for yourself?

Thats accurate. We dont deal with setting up Corps, LLC or Sole Props. Our tax issues are mainly with investment income and estate planning. I know how I will be taxed here thru the 1099. My question was pertaining to anyone else out there that has done work for hire and contracts to lay out a business model. No disrespect, but a Cardiac Doctor will not specialize in Cancer treatments. This is exactly the same concept here. I do no not specialize in this field. Which is why there are Business Attorneys and Tax Advisors. My job is to limit client taxable income, grow their wealth and plan to pass it to heirs. My question was harmless and their was no reason anyone had to be a d!ck here. This board has been great and usually people are very friendly just nit in this case.

 

[ronlane]

This sounds like an interesting opportunity to consider. I would be trying to find legal council to make sure things were okay on my side. (if it were me)

Some thing that doesn't add up to me is that you are talking like it's a partnership but he wants to 1099 you? That doesn't seem like he is thinking of it as a partnership. I would think that if it were a partnership, he would spin that part of the business off and keep a separate set of books.

Something else that just crossed my mind is this. You say that he's been getting all the people and talent to shoot. Will this be something that you can count on to continue once they all learn that he's the one no longer taking the photos? Is this something that he will continue to feed people into?

 

[Rick99]

This sounds like an interesting opportunity to consider. I would be trying to find legal council to make sure things were okay on my side. (if it were me)

Some thing that doesn't add up to me is that you are talking like it's a partnership but he wants to 1099 you? That doesn't seem like he is thinking of it as a partnership. I would think that if it were a partnership, he would spin that part of the business off and keep a separate set of books.

Something else that just crossed my mind is this. You say that he's been getting all the people and talent to shoot. Will this be something that you can count on to continue once they all learn that he's the one no longer taking the photos? Is this something that he will continue to feed people into?

Hi sorry trying to make sure I am clear on what Is going on. They are really nice people and they did talk to me about being partners as well just in the photography side. I declined as I do not want that yet but also told them according to how we do i probably would have interest in it later. Thats where the 1099 comes in to play right now. As for the referral system. Yes they will continue no matter who owns the business or who the photographer is. As long as in some capacity they are owners which they will be, they want to continue making money off it but do not want to be the photographer anymore , the referral source will not drop off. Its a really great opportunity. I will be calling my attorney to make sure i have everything in my end covered but i was really hoping a few pros here had some insight as well in the working contract and business license. I have been shooting since the early 90s and this has to be the best opportunity i have ever run into.

 

[Braineack]

So long as you're working as a contractor for your friend, then the 1099 is all that you should require to pay your earned income taxes.***

This suggest that in the state of PA, "Photographic services, film developing, printing, processing, mounting, coloring, etc," are taxable and require a Sales Tax License. So if you're taking in business on the side directly, then you'll need a Tax ID and then probably want to LLC to protect yourself.

PA also says:

Having the license physically in your possession is not necessary to make taxable sales or provide taxable services, as long you keep records of how much tax was collected, and remit the tax along with the proper documentation in a timely manner.

You can retrieve your account number(s) by simply logging onto the same site the next business day after you completed the online PA-100. Click on "Check on Application Status" and enter your Application ID and 4-digit PIN. You will receive your license(s) in the mail in 7 to 10 business days.

Your Sales Tax License should be prominently displayed at the location of the business.​

There is no fee in obtaining a Sales Tax license.​

google is my lawyer. This took me like 3 seconds to find.

 

[Rick99]

So long as you're working as a contractor for your friend, then the 1099 is all that you should require to pay your earned income taxes.***

This suggest that in the state of PA, "Photographic services, film developing, printing, processing, mounting, coloring, etc," are taxable and require a Sales Tax License. So if you're taking in business on the side directly, then you'll need a Tax ID and then probably want to LLC to protect yourself.

PA also says:

Having the license physically in your possession is not necessary to make taxable sales or provide taxable services, as long you keep records of how much tax was collected, and remit the tax along with the proper documentation in a timely manner.

You can retrieve your account number(s) by simply logging onto the same site the next business day after you completed the online PA-100. Click on "Check on Application Status" and enter your Application ID and 4-digit PIN. You will receive your license(s) in the mail in 7 to 10 business days.

Your Sales Tax License should be prominently displayed at the location of the business.​

There is no fee in obtaining a Sales Tax license.​

google is my lawyer. This took me like 3 seconds to find.

Thank you very much. All great information there!