RJI News Collaboratory

It's All Fun and Games 'til You Get Hit With A Tax Bill

I'm not a formally trained business person, but I tried very, very hard to learn what I needed to do to make Corona del Mar Today a legit business. I hired a lawyer to create an LLC, I got my federal tax number, I applied for a business license in Newport Beach.

I struggled with the county's fictitious name filing requirement -- I haven't done this because my name is on everything, really, and it doesn't seem right that they still use the very out-of-date "newspaper of record" rule for publishing a legal notice.

So imagine my surprise today, at a meeting I was covering, to be welcomed as a new member of the Corona del Mar Business Improvement District. And I owed taxes! Welcome!

My jaw dropped! I work from home, way outside the BID district. But I used a MBE box, then a p.o. box, for my paperwork. And those put me in the tax district, the same as if I opened up a retail shop on the main drag.

I stayed after to clarify that in fact, using the mailing boxes counted. I asked why the city's revenue division failed to mention this tax when I applied for my business license, and they told me that it was really too hard for them to do that. Too hard? Really? So they just sic a tax bill on people later?

I spent a good chunk of my time today, changing my address with various state, federal and local agencies in order to make sure that I don't have to pay the tax.

Not to be cheap, but come on. The BID tax pays for things like tree well beautification on East Coast Highway. It does not help a home business owner.

Also, as I told them today -- the BID and the Chamber refuse to advertise on my site. I may be the only Corona del Mar-based media, the only reporter in town, and apparently the only BID-paying reporter. But they instead opt to pay my competitors for advertising, making it a one-way street. Why shouldn't I change my address to home, where I really do my work, and avoid the tax to a group that does nothing for me?

I hate all this bureaucracy. I really just want to report and write stories. Sell an ad or two, do some marketing.

This other stuff makes me feel ripped off and tricked and yes, even dumb. The more local you go, the more horrible it is. The fed tax forms were a cinch. The state, less so.

Locally, it's a swamp.

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Comment by RJI Collaboratory on February 27, 2010 at 11:57pm
Welcome to the world of independent/entrepreneurial work. The bureaucracies in this country are all set up assuming that you're part of an organization that already knows the ropes and has a staff just to deal with this stuff. I've been independent since 1998 and it has never stopped scaring me. I keep waiting to find out about some tax thing, or business filing, or insurance thing I either forgot about or no one let me know about that's gonna land me in a heap of trouble.

It's awful, and I wish I could say there are better ways. But really, the best thing to do is to hire pros who know the ropes and do what they say. And still expect that something might fall between the cracks.

It's always harder for the little guy. The big guys are big because they've stacked the decks in their favor.

- Amy Gahran

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