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KanDoNotary
Oklahoma
69 Posts |
 Posted - 06/04/2012 : 2:50:10 PM
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I would caution the option to exempt yourself from self-employment taxes, especially as you get closer to "retirement age." That money will be something to consider in your later years.
Have Seal, Kan Travel! When you need a document notarized, I cover all of NE Oklahoma from I-35 to I-40 to the state borders. Call: 918-798-8908. |
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paulcr
North Dakota
34 Posts |
Posted - 05/30/2012 : 07:27:19 AM
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Hi Linda
I am really glad you brought that up and help spread the word that the notary fee is exempt from self employment tax. Sadly it is only the maximum amount allowed by each state per signature that is exempt (not the whole fee we charge for a signing) but that does add up over a year and does reduce our tax expense. I did call the IRS to get clarification because their written instructions could be interpreted either way and it was an unusual question for them! After researching and consulting with several other agents the agent I spoke with did finally say that the exemption would be based on state law for the notary act and that is what an examiner would reference if you were audited.
But that doesn't mean that other expenses are not deductable from income tax. The exemption from self employment tax means that you don't pay social security and medicare taxes on the amount that is exempt. The expenses associated with the remainder of your fee for a signing are still deductable from income tax.
I wonder if the IRS could make taxes any more confusing is that was the goal  They are supposed to be making the filing of tax returns easier and in the 30 years I've been filing I haven't noticed anything getting easier!!!!
Thanks again Linda for bring this nice tidbit to our attention!!!
quote:
Originally posted by LindaH
Hi Paul
Many many accountants skip this and are unaware of it - don't take it personally!!.. :)
Per IRS Publication 334, "Notary public. Fees you receive for services you perform as a notary public are reported on Schedule C or C-EZ. These payments are not subject to self-employment tax (see the instructions for Schedule SE (Form 1040)). "
http://www.irs.gov/publications/p334/ch05.html#en_US_2010_publink100025258
Good Luck!!
Linda
http://www.columbiacountynotary.webs.com
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LindaH
Florida
1754 Posts |
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paulcr
North Dakota
34 Posts |
Posted - 05/29/2012 : 6:24:13 PM
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Hi Linda
Good point about income tax (both federal and state if applicable). You'd need to estimate the tax percentage bracket you would be in that year, but definaly smart to include that!!!
Are you sure the fee allowed by the state for notarization (here in ND it is $5.00 per stamp) is exempt from income tax? That seems odd to me because it is income. I'm guessing for potential audit purposes you would need to have the signing company itemize the notary fee(s) from the signing fees...of if you have to invoice them itemize it on your invoice. Since they report to the IRS with the 1099 the total amount they pay you and you report less that would be a flag for the IRS. Or do you report the full amount on your tax return and during the itemization deduct the notary fees? This is the first time I've heard of this. I think I'm going to have to have my accountant file revised tax returns for the past 3 years at his expense for not knowing this!!!!! 
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Diedra.holley
Texas
20 Posts |
Posted - 05/29/2012 : 6:14:01 PM
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You must live in a big city, where you can charge that much. I live in a fairly small city.
DD
[quote]Originally posted by paulcr
You never know who, if anyone is available in those long-distance areas. I often get calls to go to another city that is about and hour 20 minutes each way. I charge an additional $200 - $250 on top of my standard fee and they pay it. I know there are at least 2 mobile notaries in that city. So it could be they are booked, they can't get a hold of them, or maybe they just like my work enough to pay the big surcharge
Notary
Signing Agent
Author
Single mother |
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paulcr
North Dakota
34 Posts |
Posted - 05/29/2012 : 6:11:43 PM
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You never know who, if anyone is available in those long-distance areas. I often get calls to go to another city that is about and hour 20 minutes each way. I charge an additional $200 - $250 on top of my standard fee and they pay it. I know there are at least 2 mobile notaries in that city. So it could be they are booked, they can't get a hold of them, or maybe they just like my work enough to pay the big surcharge
quote:
Originally posted by Diedra.holley
Yes, I do consider those things, but I have that all added into my bases fee. Remember that .55/mile is only for what is outside my range. I don't go far outside my range anyway. I go too far out and the signing companies would be better off using another notary. For instance, why in the world would someone call me for a singing in Dallas knowing I am going to charge them an arm and a leg? They would just be better off calling someone in the area. If they really want to pay me three or four hundred dollars, then I just might take it, but I don't see that happening.
quote:
Originally posted by Lee-AR
Just my opinion, but that .55 per mile is barely paying for your car epenses. Don't you consider your time spent driving the distance worth anything???
If you don't value your time and experience, nobody else will.
Notary
Signing Agent
Author
Single mother
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Diedra.holley
Texas
20 Posts |
Posted - 05/29/2012 : 5:40:10 PM
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Yes, I do consider those things, but I have that all added into my bases fee. Remember that .55/mile is only for what is outside my range. I don't go far outside my range anyway. I go too far out and the signing companies would be better off using another notary. For instance, why in the world would someone call me for a singing in Dallas knowing I am going to charge them an arm and a leg? They would just be better off calling someone in the area. If they really want to pay me three or four hundred dollars, then I just might take it, but I don't see that happening.
quote:
Originally posted by Lee-AR
Just my opinion, but that .55 per mile is barely paying for your car epenses. Don't you consider your time spent driving the distance worth anything???
If you don't value your time and experience, nobody else will.
Notary
Signing Agent
Author
Single mother |
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LindaH
Florida
1754 Posts |
Posted - 05/29/2012 : 5:17:30 PM
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quote:
Originally posted by paulcr
Hi Lisa. I appologize it has taken so long for me to respond.
Every single penny you pay out that pertains to your notary services adds to the cost of each notarization. Even if it is a one-time cost that covers the term of your comission - no matter how small of an amount it comes to be when spread over the term.
So look at your initial costs:
Comission fee
Bond Premium
E&O Premium
Notary Stamp Cost
Training & Certification Fees
Membership Fees (NNA, 123notary, other sites)
Background check
Often people don't break these down and apply them to the cost of each notarization because they typically span a longer period of time and the amount per notarization is pretty small depending on how many you do. But it is a cost to you nonetheless.
Typical Fixed Costs
Car payment
Auto insurance
Auto maintainence
Gas (although could be variable because of price fluctuation and distance)
Phone charges
Fax line
Internet access
Rent/Mortgage payment (portion equal to the space you use for your business)
Homeowners insurance (same as above)
Website (if you have one)
Webmaster (unless you do it yourself)
Domain name
Email account (fee accounts may not let you send/recieve large enough files)
Variable Costs
Computer
Software (word processing, accounting,etc.)
Printer(s)
Printer suplies
Misc. electronic equipment - cables, router, scanner, credit card terminal and fees (if you take cards) portable scanner (for ID copies)
Paper
Office supplies: pens, file folders, post-its, staples, paper clips, etc.
Electricity
Continuing education
Finger printing supplies
Banking fees in applicable
Accounting fees if needed
Tax preperation fees
Self employment taxes
Business cards
Advertising
Shipping supplies if not provided at no cost
Collection costs
Finance charges if any equipment needs to be financed
Most important cost
Your time - printing docs, travel, time spent at signings, preparing packets for shipping, packet drop off at shipper, negoiation with vendors, billing, banking, etc.
You have to determine what your time is worth.
This is a long list of things. Some may not apply to everyone but many of them are overlooked. Every penny put out needs to be recovered and should actually be "maked up" so that you are not just recouping your costs but the money you invest in running your business shows a return on that investment.
A lot of this relates to signing agents costs but those of us who do more high risk notarizations may have additional expenses such as higher insurance coverage.
Just don't over look any expense, put a value on your time and make sure you don't end up "paying" the signing companies because you are spending more on a signing than you are getting paid. Just as the signing companies are in business to make a profit so are you.
One thing I have noticed is that signings (say a refi) that are "no cost" to the borrower tend to be the ones that vendors start out with the really low fees. Just because the lender chooses not to charge any fees to the borrower doesn't mean that we need to basically not charge an appropriate fee. Afterall, the lender more than makes up the fees borrowers don't pay through the interest they recieve on the loan.
So these are the things I look at and figure into my fees and I always show a profit.
I hope this helps some!!
Paul
quote:
Originally posted by MsLisa
I agree with this post. I also live in a rural area and it's difficult to say yes to a signing when they're only offering $60. for you to travel what they think is a 45 minute ride. It looks good on the map but the back roads can be killer. I've learned the hard way on this. Also the number of pages, I'm still learning the hard way on that one too. Paulcr, if you don't mind, can you do a break down for us on how you derive at your prices. Would be much appreciated for a lot of us newbies out here. There seem to be some signing companies that seek us out to get their job done for a cheap cheap price. Thanks for any help you can give us.
Lisa Cirillo
Nice list Paul...I'd just add one thing along with Self-Employment taxes...that would be Federal Income Tax. Income attributed to the fee per notarization/signature (as set by the state) is exempt from Self Employment taxes but the entire fee is subject to federal income taxes. That, I've seen, is one of THE most frequently overlooked expenses.
Great list and reference tool.
Linda
http://www.columbiacountynotary.webs.com |
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paulcr
North Dakota
34 Posts |
Posted - 05/29/2012 : 10:28:19 AM
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Hi Lisa. I appologize it has taken so long for me to respond.
Every single penny you pay out that pertains to your notary services adds to the cost of each notarization. Even if it is a one-time cost that covers the term of your comission - no matter how small of an amount it comes to be when spread over the term.
So look at your initial costs:
Comission fee
Bond Premium
E&O Premium
Notary Stamp Cost
Training & Certification Fees
Membership Fees (NNA, 123notary, other sites)
Background check
Often people don't break these down and apply them to the cost of each notarization because they typically span a longer period of time and the amount per notarization is pretty small depending on how many you do. But it is a cost to you nonetheless.
Typical Fixed Costs
Car payment
Auto insurance
Auto maintainence
Gas (although could be variable because of price fluctuation and distance)
Phone charges
Fax line
Internet access
Rent/Mortgage payment (portion equal to the space you use for your business)
Homeowners insurance (same as above)
Website (if you have one)
Webmaster (unless you do it yourself)
Domain name
Email account (fee accounts may not let you send/recieve large enough files)
Variable Costs
Computer
Software (word processing, accounting,etc.)
Printer(s)
Printer suplies
Misc. electronic equipment - cables, router, scanner, credit card terminal and fees (if you take cards) portable scanner (for ID copies)
Paper
Office supplies: pens, file folders, post-its, staples, paper clips, etc.
Electricity
Continuing education
Finger printing supplies
Banking fees in applicable
Accounting fees if needed
Tax preperation fees
Self employment taxes
Business cards
Advertising
Shipping supplies if not provided at no cost
Collection costs
Finance charges if any equipment needs to be financed
Most important cost
Your time - printing docs, travel, time spent at signings, preparing packets for shipping, packet drop off at shipper, negoiation with vendors, billing, banking, etc.
You have to determine what your time is worth.
This is a long list of things. Some may not apply to everyone but many of them are overlooked. Every penny put out needs to be recovered and should actually be "maked up" so that you are not just recouping your costs but the money you invest in running your business shows a return on that investment.
A lot of this relates to signing agents costs but those of us who do more high risk notarizations may have additional expenses such as higher insurance coverage.
Just don't over look any expense, put a value on your time and make sure you don't end up "paying" the signing companies because you are spending more on a signing than you are getting paid. Just as the signing companies are in business to make a profit so are you.
One thing I have noticed is that signings (say a refi) that are "no cost" to the borrower tend to be the ones that vendors start out with the really low fees. Just because the lender chooses not to charge any fees to the borrower doesn't mean that we need to basically not charge an appropriate fee. Afterall, the lender more than makes up the fees borrowers don't pay through the interest they recieve on the loan.
So these are the things I look at and figure into my fees and I always show a profit.
I hope this helps some!!
Paul
quote:
Originally posted by MsLisa
I agree with this post. I also live in a rural area and it's difficult to say yes to a signing when they're only offering $60. for you to travel what they think is a 45 minute ride. It looks good on the map but the back roads can be killer. I've learned the hard way on this. Also the number of pages, I'm still learning the hard way on that one too. Paulcr, if you don't mind, can you do a break down for us on how you derive at your prices. Would be much appreciated for a lot of us newbies out here. There seem to be some signing companies that seek us out to get their job done for a cheap cheap price. Thanks for any help you can give us.
Lisa Cirillo
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Lee-AR
Arkansas
678 Posts |
Posted - 05/29/2012 : 04:42:15 AM
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Just my opinion, but that .55 per mile is barely paying for your car epenses. Don't you consider your time spent driving the distance worth anything???
If you don't value your time and experience, nobody else will. |
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Diedra.holley
Texas
20 Posts |
Posted - 05/22/2012 : 3:25:31 PM
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I have similar issues. I live in a fairly small town, and there are lots and lots of notaries here, but I can't tell how many do loan signings. No lawyer or title company will give space to do closings and they are quite rude about it, so I am limited.
Fees are hard to figure, for me. I charge a base of $90, plus $20 for edocs. That gives me 110 per signing. If it is outside my normal range, I charge .55 per mile both ways or 1.00 a mile one way. I think that is more than fair. Most of the time, my signings are right here in town, so they are $100 or $110 each. Something else I look at is whether or not the company normally gets me the docs in plenty of time. I am still pretty new at this and I can't just print and go. I need time to ensure each doc is correct and I have little removable tags I put on each page that needs a signature or a notarization, that way I don't miss anything. I normally end up going through it three times before I leave for the signing, then two more times before I leave the table to ensure I haven't missed anything. I still put a sticky tab over the signature block that says "I want to cancel" on the recission page just so I remember NOT to have them sign there, but at the bottom of that page to acknolwedge receipt of it.
While this is a pain for me, it also ensures my packages are perfect when they are sent back.
It's tempting to take lower paying jobs right now because things are so slow for me, but I have stood my ground. I have had a couple of calls that wanted me to do a signing for 75. I simply say, "I'm sorry Sir, my minimum fee is $100 for those. Can you meet that?" Sometimes they will, other times they won't.
I use Notary Assist software to keep up with everything. Expenses, signings, regular signing companies and the relationship I have with them, contact numbers, invoices, everything. That program was worth every penny I paid for it, which wasn't much, and it was just another expense. Taxes should look great next year. With all the education, start up costs, memberships, supplies, advertising and software I have purchased, it should be really nice come Feb of next year.
Notary
Signing Agent
Author
Single mother |
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MsLisa
New York
18 Posts |
Posted - 05/22/2012 : 12:39:24 PM
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I agree with this post. I also live in a rural area and it's difficult to say yes to a signing when they're only offering $60. for you to travel what they think is a 45 minute ride. It looks good on the map but the back roads can be killer. I've learned the hard way on this. Also the number of pages, I'm still learning the hard way on that one too. Paulcr, if you don't mind, can you do a break down for us on how you derive at your prices. Would be much appreciated for a lot of us newbies out here. There seem to be some signing companies that seek us out to get their job done for a cheap cheap price. Thanks for any help you can give us.
Lisa Cirillo |
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paulcr
North Dakota
34 Posts |
Posted - 05/10/2012 : 5:07:21 PM
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Fees are discussed in many places on this forum. But I thought I'd put in my 2 cents :)
The most recent piece of real estate I sold was in a different state than I live. So it required a signing agent to come out to complete the closing signing & notarizing.
When I got the final HUD settlement I looked to see what I as the property seller paid for the signing fee. It was $275. It was a pretty basic signing. About a total of 150 pages (75 each original and my copy), took about 30 minutes, the signing agent drove 2.5 miles to my place.
Today I had a signing company contact me to register with them. They pay $50 when they provide the docs, add an additional $25 if I had to print them. I explained to them that I negotiate the fee for each signing based upon the number of pages in the docs and the distance. Since often I am doing signings in rural areas that can easily be 100 miles each way the $50 wouldn't even cover the cost of gas.
Their response is that fees are non-negotiable. So I told them to take me off of their mailing list based upon their decision.
Now do a little math. $275 - $50 = $225. Granted they may not charge quite as high as $275 but they should be.
My advice to newbies (and old timers alike) is do not accept any assignments that don't go above tripple digits. I realize the someone new is going to want to try and build a base of business by taking very low paying assignments. However, in the long run you only end up hurting yourself. If you think that taking the low fee assignments now and then raising your rates with a signing company after proving yourself to them a few times you are wrong. They will just go and look for the next person who will take the low fees.
Also it impacts our whole industry. There are a few posts that break down all of the costs you incur for each signing. Take a look at your expenses (don't forget things like cell phone, insurance, background check, auto insurance, auto maintenance, internet connection, etc., fees) and when you break all of them down it costs you a lot of money to do a signing.
Your time, expertise, customer service, and your comission are all valuable assets. Don't sell yourself short.
The only time I reduce my fees is when I am doing a notarization for a non-profit or in-hospital/hospice medical documents. Because what I personally get out of doing those types of notarizations makes up for the loss in fee. It is one of the reasons I am a mobile notary. There are opportunities for me to give back to things I believe in. But when it comes to business transactions the fees are where they should be for me to make it worth my time. |
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The Same 'ol Question of Fees
