Sunday, January 15, 2023

In The Thick

There is a big difference between being "in the thick of it" and "in the weeds"....unless one is doing ones American taxes, and that's what I am talking about.

Late last year, I wrote about a professional author's responsibility to send out 1099-NEC forms to non-employees, and to send a cover form, the 1096, with the red copy to the IRS. Before 2021, the forms were 1099-MISCs. Now, the 1099-MISC is to declare any sum at all paid to a lawyer (for help with ones business).

Forms 1096 with forms 1099-NEC have to be filed by January 31st. It looks like the 1099-MISCs might have an extra month, but why procrastinate and add to ones mailing expenses? I assume that one is not e-filing.

I checked the Author's Guild site, and there is a video advising authors when to create an LLC (limited liability company) or S Corp.

Assuming that those reading the alien romances blog are either writing-business owners who sell their works wherever they can, including on social media or e-commerce sites, or are avid readers who may sell on physical copies of their book collections (in hard copy form, of course per the first sale doctrine) I should like to point to Ryan Stegenga, legal blogger for the Gordon Law Group who published a crash course this last week for anyone selling "stuff" on Facebook, Etsy, or Ebay.

He also presents a helpful (and ad-free) video on YouTube
For those who prefer text, the advice is here: 

As a copyright enthusiast, I should like to point out that the first sale doctrine does not apply to e-books. E-books may not be copied and copies sold on, since copyright does not permit anyone other than the author and his/her/their publishers or licensees to create a copy of works.

EBay has a long history of allowing private pirates to sell in-copyright novels as ebooks, repeatedly selling the same e-book over and over again, but that is a topic for another day.

Back to the taxes. It appears that Facebook and EBay will send you 1099-MISCs or 1099-Ks for you to report on your own tax return (the latter only if you sell quite a massive amount.) They will report this activity with the 1096 to the IRS, so if your tax return does not match what is sent in by the platform about you, you might face questions.

If you ever wondered about the recent uproar about every transaction over $600 suddenly being reportable, (it has been postponed), online commerce on Facebook, Etsy, and EBay was part of the discussion.

Happy filing!

All the best,

Rowena Cherry 
EPIC Award winner, Friend of ePublishing for Crazy Tuesday 

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