I’m not asking really big questions I’m just asking where deduct fees for being a notary? If anyone can also bring up which of the new schedules (and old ones) we’ll need to complete taxes that would be great.
I use TurboTax Personal and Business. It had a section in it’s forms that said “Self-Employment Taxes”. When I clicked on that, it asked me how much of my business (dollar amount) was for notary purposes. You can either go back through and tally up all your notaries or take a certain dollar portion. I just took a certain dollar portion even though all of my income was considered notarizations. Just remember, that by doing this you are not going to get credit for anything for self-employment taxes and will not go reported as earnings for your social security. TurboTax is also good for your business expenses. It walks you through everything.
Why are you taking a portion. You should claim all of your income. Your notary income is exempt. So you don’t pay taxes on it anyway.
You should use QuickBooks or some type of accounting program to record your business income and expenses, this way at the end of the year you’re not trying to figure out what your income and expenses are.
I have been using QuickBooks since I started my business in 2003, it’s easy to use and I can keep track of who has paid when and how along with who hasn’t. By tracking this it has helped me to weed out slow paying or no paying agencies.
Anything you pay out for your business is an expense. The only exception are meals check out this article regarding that https://www.journalofaccountancy.com/news/2018/oct/tax-deduction-meal-entertainment-expenses-201819848.html.
You can deduct paper, toner, travel expenses etc.
I hope this was helpful.
Maybe I’m wrong but I thought the only thing that Notaries are exempt from are the self-employment tax ? If not, Would you please let me know where I can find that information ?
Yes, kthomas, you only deduct the notary fees on Schedule SE. The notary fees are included in your total profit on Schedule C and after deducting the expenses, the total net profit goes on the 1040. Deduct the notary fees from the net profit on Schedule SE, since your notary fee only are not taxed for
Sorry, my computer posted before I was finished. Your notary fees are not subject to Self Employment tax. You can look up the instructions for Schedule SE and there is a section for Notary Fees.
All notaries should be keeping track of all your notary fees separate from the total amount you received for the signing. And, you can only deduct notary fees for the amount of what you were paid. If you do a job for $50, but your total notary fees were actually more then $50, you can only deduct $50.
Most of the tax preparation programs have the notary fee deduction programed into the system, As someone mentioned, you might consider how much you need to contribute to your Social Security fund if you’re not collecting from SS at this point.
- Notaries Paying Self-Employment Tax
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.
ericpaulsellers, find yourself someone who can help you. Someone that you are comfortable with. I know. I have not only my notary business that I operate, but also a tax business. You would be surprised what you can do, and not do. TurboTax is misleading, and the IRS does not like it. You need to decide what venue you are going to use. Quick Books can be very intimidating and a bit overwhelming; I use Quicken and it works just fine, and you can download it from online and there are support staff available to help you if needed. There are other financial software programs out there, and some of them free. I like Quicken and have used it for over 25 years. I am happy to help you if you would like, your call. Right now I have to get back to work, on tax returns! Good luck and have a great day!
My practice is primarily taxation - I am an Enrolled Agent, doing representation (including tax litigation), research and complex tax situations. Most of my clients are other tax practitioners or attorneys on behalf of their clients…
On the new forms, income can be placed on Schedule 1, but the line numbers are mostly the same. Notary income is recorded on Schedule C, which bubbles up to Schedule 1, Line 12.
The Schedule C is relatively straightforward, and can bear the same name as the taxpayer. Expenses are defined in categories; the form, as a whole, can clearly present the taxpayer a picture of how profitable their notary services.
Only the statutory notary fees per notary act are exempt; for example, in NY it would be $2.00 per notarial act (i.e.: acknowledgement or jurat). This comes from regulations covering fee basis public officials, specifically Treasury Regs. 1.1402©-2(b)(2).
If the taxpayer had no other income subject to SE tax, enter “Exempt—Notary” on Schedule 4 (Form 1040), line 57; the taxpayer should not file Schedule SE. However, if the taxpayer had other earnings of $400 or more subject to SE tax, enter “Exempt—Notary” and the amount of their net profit as a notary public from Schedule C or Schedule C-EZ on the dotted line to the left of Schedule SE, line 3. The taxpayer should then subtract that amount from the total of lines 1a, 1b, and 2, and enter the result on line 3.
FYI, the 2017 1040 more resembles its 1917 predecessor, than its current year (2018) version!
Just a quick question! A refinance transaction requires approximately 10 notary acts for document packages of about 150 pages. Is the notary permitted to deduct 10 notary acts at $4.00 (Maryland) each or just $4.00 for the package that contained 10 notarized documents?
Sometimes it pays to check the actual statutes.
By my reading, the amount that constitutes “official fees”, therefore not subject to self-employment tax, is $4 per notary act (each oath or acknowledgement) plus $5 per signing for travel, if applicable. The mileage may also be exempt at $0.19/mile, but might complicate its deduction on Schedule C, which i ostensibly worth more.
Duplicate notary acts on the same item are subject to a reduced fee ($1, I believe).
Md. Code, State Gov’t §18-112 (Renumbered as § State Government-18-107 by 2019 Md. Laws, Ch. 407,Sec. 1, eff. 10/1/2020) states:
(a) The Secretary of State shall adopt regulations to establish fees, not to exceed $4 for an original notarial act, and an appropriate lesser amount for the repetition of that original notarial act or to make a copy of the matter addressed by that original notarial act.
(b) A notary public may charge 19 cents per mile, or a higher amount set by regulation of the Secretary of State, and a fee not to exceed $5, as compensation for travel required for the performance of a notarial act.
Hope this helps.
Stay healthy, and God bless,