If you are C or subS corporation (don't know about LLCs) every year in Colorado you have to file an annual report with the Secretary of State. This confirms your address and who are the officers of the corporation. It cost $10 to do this on line and it takes about 15 minutes. Scammers are sending out official- looking paper work to the unsuspecting with some scare verbiage about the filing. They will do it for you for a mere $125.00. One of these scammers is: Compliance Services, Grand Junction, CO. 9-News business has reported on this in the past but these scammers pop up every summer.
You need to be a member of Art Fair Insiders to add comments!
This is a separate issue from paying taxes in Colorado. To continue to do business as a corp. you have to register annually with the Secretary of State. The cost is $10 for the annual filing. Paying taxes is something different. As a subS in CO the tax liability flows to my personal taxes at year's end. I have heard horror stories about corps. having to pay taxes up front when doing shows in other states. In CA it's $800. Don't know how well Chris's deception would work and what the penalty would be if you got caught. Legal guys always told me to hold yourself out as a corp. (letter heads, signage, cartouches, etc. ) as in a law suit the other side would try to "pierce" or invalidate the corporate status which is there to protect you, the individual.
Chris Hoyt > Richard L. ShererAugust 1, 2013 at 7:51pm
There's no deception. You are registering as a person representing the corporation when you do out of state shows. You file your paperwork as Joe Blow, not Veeblefetzer, LLC.
This is off topic and should be in another thread. It sounds to me like a grey area. I don't fully understand what your liability with metal art might be. My art connects people to 1000-1500 pound animals (horses) who can be unpredictable. thus, the liability is pretty high, and explains my caution. Maybe some legalese on this topic can be contributed in a new thread.
Stephen White > Richard L. ShererAugust 1, 2013 at 10:51am
I thought the $800 in CA was a "minimum franchise tax" for state corps? Visiting artist that do shows in CA have to pay $800 to the state regardless of if they make any profit? Does this have to happen b4 you do a show or do you have to send them an $800 check with a tax return?
From what Steve Appel told me, yes, it's $800 up front for out of state corps, profit or not.
Stephen White > Richard L. ShererAugust 1, 2013 at 11:42am
wow, that's hefty. I was aware one needed to pay the sales tax to the home state of the show but was not aware that states collected fees and taxes beyond this from visiting artist. I know you have distinguished corps from sole proprietorships but these days I would think, simply for liability purposes, that almost all full time artist are at the very least operated as an LLC. As you mentioned, deception may well avoid the payment but opens up a whole can of worms if something adverse happens. I would liken it to not getting a required building permit. You don't get hit with the permit cost but if something goes wrong then it opens you up to an even larger array of cost and liabilities.
I wonder if there is a chart somewhere on the net that might break this down. I know from experience that simply calling the state offices can get incorrect results and this is a big deal if you travel a region that encompasses a number of states, which is easy to do.
Is there a national organization for arts and crafts vendors? This would seem like a good cause for a national organization to pursue with the states as it is in the states best interest to have a robust artist community and the fairs offer a lot to the local communities and the state as a whole. It seems like it would not be a hard sell to various state lawmakers but they have to be approached and "worked" for a period of time to get these types of changes made and that means a lobbyist group retained in the states that have these fees and taxes. It might even be worth it to attempt to have a special sales tax rate established for traveling artist. The argument can be made that the economic benefit from increased fair activity is positive and that the transient artist does not participate in the many of the activities that local businesses do in regards to what the sales and use tax is meant to cover. This could end up being a red herring but by coupling the two you probably increase the chance of a compromise and the elimination of the other fees beyond sales tax.
I'm going to look for a chart or breakout and will post back here if I can find such a page on the net.
Might best to start a new thread for this topic. What I was discussing here was a Scam in Colorado. Taxes and nonresident fees is another kettle of fish. Nobel idea but think the States will continue to gouge artists.
Stephen White > Richard L. ShererAugust 1, 2013 at 12:23pm
Replies
Similar scam was going around here in California about 3 years ago. So watch out, these guys don't have state borders:(
There's no deception. You are registering as a person representing the corporation when you do out of state shows. You file your paperwork as Joe Blow, not Veeblefetzer, LLC.
You file in your home state as the corporation.
I thought the $800 in CA was a "minimum franchise tax" for state corps? Visiting artist that do shows in CA have to pay $800 to the state regardless of if they make any profit? Does this have to happen b4 you do a show or do you have to send them an $800 check with a tax return?
wow, that's hefty. I was aware one needed to pay the sales tax to the home state of the show but was not aware that states collected fees and taxes beyond this from visiting artist. I know you have distinguished corps from sole proprietorships but these days I would think, simply for liability purposes, that almost all full time artist are at the very least operated as an LLC. As you mentioned, deception may well avoid the payment but opens up a whole can of worms if something adverse happens. I would liken it to not getting a required building permit. You don't get hit with the permit cost but if something goes wrong then it opens you up to an even larger array of cost and liabilities.
I wonder if there is a chart somewhere on the net that might break this down. I know from experience that simply calling the state offices can get incorrect results and this is a big deal if you travel a region that encompasses a number of states, which is easy to do.
Is there a national organization for arts and crafts vendors? This would seem like a good cause for a national organization to pursue with the states as it is in the states best interest to have a robust artist community and the fairs offer a lot to the local communities and the state as a whole. It seems like it would not be a hard sell to various state lawmakers but they have to be approached and "worked" for a period of time to get these types of changes made and that means a lobbyist group retained in the states that have these fees and taxes. It might even be worth it to attempt to have a special sales tax rate established for traveling artist. The argument can be made that the economic benefit from increased fair activity is positive and that the transient artist does not participate in the many of the activities that local businesses do in regards to what the sales and use tax is meant to cover. This could end up being a red herring but by coupling the two you probably increase the chance of a compromise and the elimination of the other fees beyond sales tax.
I'm going to look for a chart or breakout and will post back here if I can find such a page on the net.
My apologies for getting off topic.
-
1
-
2
of 2 Next