Pay to Play and now tax on merchandise

CoolCat

CoolCat

Well-known member
I was just hearing the sons band being sent a W-9 from some place they play wanting 15% of the merchandise sold.
Its bad enough they dont pay crap and often nothing at all if you dont pre-sell tickets but now they want merchandise %?

damn whats a band need next a lawyer and a CFO?

I recall the days it was just bars and beer and cash and a hangover and gear...... maybe its being in the big city with big competition and big business and big greedy a-holes?

anyone else seeing the pay to play and tax on merchandise forms?
 
Just tell them to refuse and force the venue to deny them playing there. Word spreads fast. If all the bands refuse and they no longer have anyone to play, the venue straightens up their act real quick. That's how unionized workers push back on manufacturers, they refuse to show up to make the goods and when warehouses get low on stock the manufacturer stops being an asshole.
 
Pinky said:
Just tell them to refuse and force the venue to deny them playing there. Word spreads fast. If all the bands refuse and they no longer have anyone to play, the venue straightens up their act real quick. That's how unionized workers push back on manufacturers, they refuse to show up to make the goods and when warehouses get low on stock the manufacturer stops being an asshole.
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Unfortunately, there's an endless supply of eager new bands that will play any venue that will let them.
 
I'm not getting the 15% on the merchandise part related to the W-9, but maybe it is somehow. The W-9 is a request for a taxpayer ID number that is submitted to the place that pays the band. The place that pays your sons band to play may need to send the band a 1099 (which will need a tax ID number) to show income for tax purposes if they make enough to file. Years ago I had a tax ID number for photography work I was doing and some places I did work for needed a W-9 with the the tax ID numbers. Is the 15% is for tax withholding purposes?
IRS Form W-9 – What It Is and How to Fill It Out
 
geez...yeah its one venue doing it. maybe they hired a micromanaging accountant....whats next they have to claim the sandwiches and free beers?

its such small money when its all said and done I like Pinkys recommendation, just dump the place. Personally the crowds there kind of suck anyway. The poor stand and the credit card people pay $125 for a picnic table and the $500 tables with a waiter is upstairs.

probably going broke trying to squeeze money out of the bands.

reminds me of the DIlbert cartoon "never let an accountant run your business because they'll shut it down to save money." haa
 
CoolCat said:
geez...yeah its one venue doing it. maybe they hired a micromanaging accountant....whats next they have to claim the sandwiches and free beers?

its such small money when its all said and done I like Pinkys recommendation, just dump the place. Personally the crowds there kind of suck anyway. The poor stand and the credit card people pay $125 for a picnic table and the $500 tables with a waiter is upstairs.

probably going broke trying to squeeze money out of the bands.

reminds me of the DIlbert cartoon "never let an accountant run your business because they'll shut it down to save money." haa
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That's a good one. One thing you might try doing is getting them to define "merchandise" in writing and pray to god that they miss something.

EDIT: You guys do have a contract written out, right?
 
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arcaxis said:
I'm not getting the 15% on the merchandise part related to the W-9, but maybe it is somehow. The W-9 is a request for a taxpayer ID number that is submitted to the place that pays the band. The place that pays your sons band to play may need to send the band a 1099 (which will need a tax ID number) to show income for tax purposes if they make enough to file. Years ago I had a tax ID number for photography work I was doing and some places I did work for needed a W-9 with the the tax ID numbers. Is the 15% is for tax withholding purposes?
IRS Form W-9 – What It Is and How to Fill It Out
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That's what I thought of, too. A W9 is for tax filing. Something's not right in the request - suspect your son (or whoever in the band got the thing) wasn't reading it correctly.
 
That makes sense the clarity isnt there. But it was only this one place even asking for it to be done. They also want to write off probably all the money theyve paid out to all their bands and make them declare it as income.

Its still not worth it....they dont pay shit and then want more time doing tax crap. The only way the bands made money was really selling merchandise and now they are going after that too.

how much do you Pay to Play there? nothing imo. theres alot of other places with better or equal crowds and pay better and dont have all this accounting shit. ahaaahaaa damn.

I mean we are talking $100 nights....not $10,000 nights.... theres always like 4 or 6 bands so the payout is divided by 4 or more.

The old days of one band playing all night and having sets and taking the door, the bar took the alcohol could be $1200 a night.
$600 easy. 60 people by $10 admission....sell some tshirts the players get $100 each, the van gets repairs for $300..ahahaa

now its like the whole band gets $100 total and the headliners who drove from Florida to Texas get $400. Maybe sell $700 in merchandise but now the Bar wants a merchandise cut too it seems. geeez? or at least they want a write off for the money they paid bands to reduce their tax debt ...right?

this is a first time this bar has asked for W9.
 
Did the bar sell the merchandise for the band? If so, they might be trying to recoup the sales tax, plus a little. The W9 isn't the right form. A 1099-Misc would be correct.
 
arcaxis said:
I'm not getting the 15% on the merchandise part related to the W-9, but maybe it is somehow. The W-9 is a request for a taxpayer ID number that is submitted to the place that pays the band. The place that pays your sons band to play may need to send the band a 1099 (which will need a tax ID number) to show income for tax purposes if they make enough to file. Years ago I had a tax ID number for photography work I was doing and some places I did work for needed a W-9 with the the tax ID numbers. Is the 15% is for tax withholding purposes?
IRS Form W-9 – What It Is and How to Fill It Out
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thats a good article and a couple flags noted.

On one hand, there are some legitimate reasons why you might become an independent contractor rather than an employee. On the other hand, employers sometimes run into financial difficulties and can no longer afford to pay their half of payroll taxes.If your employer reclassifies you as an independent contractor, you become responsible for paying his half of payroll taxes as self-employment tax.

also


You may be asked to complete IRS Form W-9 if you or your business are contracted to provide services to another company. The company then uses the information you provide on the form to prepare ​Form 1099-MISC, reporting to the Internal Revenue Service the amount of income it paid to you or your company.

Because theyve played there for years several times, and this is all new it could be very possible they are under financial duress with taxes and now wanting to use the bands as the patsy's. It makes sense they could say we spent $$$$$ on these bands and so go after them not us.
 
Chili said:
Did the bar sell the merchandise for the band? If so, they might be trying to recoup the sales tax, plus a little. The W9 isn't the right form. A 1099-Misc would be correct.
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It might be legit for some bigger income bands but its a joke (or a red flag) for these guys. This place isnt a venue arena ahahaa
its a bar, restaurant, yeah its well done and all that but the gigs are no different than any bar. Its outdoor on a outdoor stage where people bake in the sun until evening. This company does have numerous venues and one is a large arena 5000 seater with the large screens. Maybe its been mismanaged for years then? Why all of a sudden they need IRS forms?

Again the money spent selling merchandise and the poor pay isnt worth it. Maybe the bands should send them a W-9 for all the money they spent drinking and eating there too!!! Its like the band brought in the crowd and spent money on beer so maybe the band should get 15% cut of the alcohol sold! lol

None of the other bars do this....so Im still leaning towards this big place is having tax issues.
 
It could be that the venue was under scrutiny by the IRS or even musician's unions...and they are just covering their own asses by showing that everyone who plays (works) there is a legit tax payer.
Similar to the way bars/bands who profit from covers in some areas have to pay back to the performing rights groups...so the government too want's every crumb it can get its hands on from even the hobbyist working musicians.

States are also getting more money hungry and putting pressure on anything that smells like a "business" no matter how small. Like now they want to wipe out all the online "no tax" sales, and are even looking to tax all sales on places like eBay, where you have some guy selling off the shit he originally bought in some store (and already paid taxes on)...but they want to re-tax those sales. Next they'll come around looking to tax the yard sales.
 
so is there a income limit before becoming legit and not being a losing cash hobby creative enjoyment band?

i did find out all the bands were getting this email with W-9 that then allows them to send out the 1099's and yet over the 6yrs of playing there its never been asked before and the money often doesnt even happen, numerous fights with management of not even being paid the $100 per band...or the promised free dinner coupons were not handed out to the bands.

its a big place maybe too big...too greedy?

but playing Perry Mason, it seems odd after 6yrs they finally want tax forms from all the bands so I lean toward this place is under a tax IRS thing and wanting to suck the bands into it.
Like Perry always asked in his cases "whose to benefit?"
 
CoolCat said:
...its a big place maybe too big...too greedy?
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Then I bet it does have something to do with them coming under scrutiny...and they really have nothing to gain from the bands paying taxes. They are just protecting themselves, showing that everyone they do biz with is a legit (tax paying) company, which would include the bands....which are technically self-employed or their own "company".
One might think like WTF? do they care if the band is paying the IRS a portion of their band earnings...but in biz, bigger biz, you don't want to appear like you are dealing with non-tax paying businesses...'cuz if they get under the IRS eye, then it can suck their co-business in too.
Like they wouldn't want to buy liquor from some shady distributor...so I'm sure they ask for those forms from everyone, not just the bands.

Is this in a bigger city or some smaller, more rural area...?
 
its a big outfit, city and several places. so they play cover their backs... :)

does the band need a tx id and all that crap? hahaa...do garagebands and new bands need business licenses to play and maybe a lawyer!
incorporate and a CFO and board? or just stop playing there.... W9

number 9, number 9, number 9, number 9
 
Chili said:
The W9 isn't the right form. A 1099-Misc would be correct.
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I gotta correct myself. I think the W9 is the correct form. As Arcaxis said, it's a request for a tax payer ID number... SSN or EIN. I send out W9s occasionally when I send quotes to my customers per their request. They might have a tax deduction they can take if they pay us for our services or they just want to report the expenditure.

Sounds like the bar wants to report where it is spending its money. If they do, then you kid and band mates might have to report the income. Now, I would have to do a lot of thinking before I send my SSN to a bar owner.

As for the 15% on merchandise, they are looking for a commission and if there is no signed contract, your kid's band is probably not obligated to pay it.
 
CC, it might be worth a call to the venue to ask them why this sudden need. But I'm still leaning toward my original reaction, as well as Chili's reservation about providing social security information to someone you're not sure you can trust with it (at least not without a REALLY damn good reason for them to have it).
 
They don't have to do a 1099-MISC if they pay you less than $600/year, but many places are just doing it for all performers/bands ow so they don't have to keep track after the fact. As a band, you can run it a couple of different ways if you don't want to do the LLC thing (which can cost you some money, setting up, tax attorney, etc): 1) have the 'leader' get all the pay and then divide it up, but also do the SSN/1099 thing for each band member (pain in the ass); or have the venues pay different band members each time you play to equal things out - each band member will have to include the pay on their annual taxes, or be prepared to be audited. Even if your pay is less than $600 from a venue (per SSN), you still have to report the earnings, because you don't know if the venue has reported the earnings (because they don't have to send you a 1099-MISC if it's less, but they should anyway).
I miss the old days of cash at the the end of the night ...

The whole '15%' for merch sales ... totally separate thing. here's no way for them to know how much you sold, send them $2!
 
Surely these two things are separate - merchandise always attracts a commission here, and the amount you get paid is a negotiation?
Can be good or bad?
 
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