Los Angeles Professionals... need help.

Ryan Patrick O'Hara

Ryan Patrick O'Hara

Veteran
So....

I am pretty young (out of film school just a couple years ago) and stupid when it comes to doing my taxes and city business taxes and etc. I need a hot lawyer/accountant gf.

I recieved a letter from the City of Los Angeles saying that they suspected I was running a business within the city limits and needed to register it with the city plus pay applicible taxes. I never registered because I didn't think I was running a business. I only freelance my services to production companies who themselves are registered businesses...

I called them up and explained that I am not running a business but am a freelance camera department crew member, and they said unless I am W-2 employed (which I'm not (I fill out W4's with the rare and occasional stupid business 1099)) I need to report all my income (from jobs originating, planned or created in CA) to them and I have to pay applicable tax.

I already report all my work to the IRS for income taxes and etc, so call me a naive kiddo, but I wasn't aware that working as a freelance DP or camera assistant meant I had to register with the city as a business.

This might be silly and obvious, but I wanted to ask other members here (such as SadMax and others) who are professionals and what they had to do / are doing. Wish there was a class in film school to prepare you for the legal headache of taxes and bureaucratic surprises. Looks like I owe around $500 in fees and what-not for not doing this sooner.

I'd be very happy for any insight on the matter.

-ryan
 
As far as I know if you are working as a free lancer in any state you are de facto operating an independent business and required to meet licensing and tax obligations for your location.
 
I've been freelancing for 12 of the 15 years that I've been in America and I'm not registered as a business.
 
Yep, Los Angeles knows how to squeeze money out of you. If you're paid by 1099, you need to register with the Office of Finance; only way around it is to be an actual employee of productions and be paid via W2. I registered a couple years back even when 80% of my income was on out-of-state productions, but my tax filing address was within LA city limits.

I'd recommend dropping by the LA Office of Finance office in Santa Monica in person- they had an amnesty deal when I first registered and are actually pretty helpful in categorizing your business license to get your fees down to the minimum.
 
dcarstens said:
Yep, Los Angeles knows how to squeeze money out of you. If you're paid by 1099, you need to register with the Office of Finance; only way around it is to be an actual employee of productions and be paid via W2. I registered a couple years back even when 80% of my income was on out-of-state productions, but my tax filing address was within LA city limits.

I'd recommend dropping by the LA Office of Finance office in Santa Monica in person- they had an amnesty deal when I first registered and are actually pretty helpful in categorizing your business license to get your fees down to the minimum.
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This seems to be the feedback I'm getting now. After looking into it, I wish I had done it awhile back. There is this thing, if I understand it correctly, that if you don't make more than 100,000 a year, you get a "small business break" which means you don't pay anything. I'm not balling six figures yet, so this seems like it could have been painlessly avoided should I have known about this before getting the threatening letter with past incurred fees and fines. :(
 
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For what little it's worth, when I moved to Pasadena I was pleasantly shocked - shocked! - by how friendly, inexpensive, and bend-over-backwards-to-help-you the city government personnel and fees are, by comparison to Los Angeles.
 
Sad Max said:
For what little it's worth, when I moved to Pasadena I was pleasantly shocked - shocked! - by how friendly, inexpensive, and bend-over-backwards-to-help-you the city government personnel and fees are, by comparison to Los Angeles.
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What´s the difference in fees?
 
dcarstens said:
Yep, Los Angeles knows how to squeeze money out of you. If you're paid by 1099, you need to register with the Office of Finance...
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ouch, feeling for you on the west coast. No loopholes that a paid tax accountant can get you out of these? Paying a tax professional saves me truckloads
 
I registered our business in Pasadena.. we do have a physical store in Pasadena. AKAIK, business license in city of L.A. is calculated based on your income. It's really not business friendly. Pasadena is much easier. It's about $1xx for a business license for a year. But I think you do need to have a physical presence in city of Pasadena as they might send someone to check the zoning requirement.

The next logical thing is setting up a DBA (Doing Business As). It could be your name or a business name. Then you can deduct all the expense involved in your business (some part of your cell phone bill, driving mileage, equipment purchase).

It's best to consult a CPA that they can give you the best accurate advice.
 
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