The SB 616 bill, introduced by Senator Farnese is, according to a little tweet I heard, a dead duck. It amended the 1953 law P.L.1323, No.373. by making it required for all Notaries working with real property to carry $100,000 of bond coverage. There were other statutory changes but they should all be moot providing it never passes out of committee. There are related bills, 615 and 617 that have other conditions that apply to the Recorder of Deeds and processing of title insurance and deeds. This all was obviously in reaction to the large number of homes that had been fraudulently conveyed in Philadelphia due to the negligence of staffers or procedures that criminals had learned how to circumvent.
The 2010 Tax Relief Act, which reduced the self-employment tax by 2 percent for notaries who own a sole proprietorship or signing agent business (and other self-employed individuals) continues on 2012 income. The tax rate of 13.3 percent includes 10.4 percent for Social Security and 2.9 percent for Medicare. The Social Security portion of the self-employment tax will return to 12.4 percent for 2013 earnings. Income received as a self-employed notary or signing agent, including notarial fees, clerical and travel fees, must be reported as part of the gross income which is reported on Schedule C or Schedule C-EZ of a 1040 tax form. Notarial fees allowable by the Pennsylvania Notary Public Law, such as those collected for completing affidavits, verifications, acknowledgments, certifications, are not subject to self-employment tax. According to the Internal Revenue Service, www.irs.gov: “Fees received for services performed as a notary public – If you had no other income subject to self-employment tax, enter Exempt – Notary on Form 1040, line 56. Do not file Schedule SE. However, if you had other earnings of $400 or more subject to the self-employment tax, enter Exempt – Notary and the amount of your 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. Subtract that amount from the total of lines 1a, 1b, and 2 and enter the results on line 3.” Expenses such as travel, notarial supplies, seminar tuition, notary association membership fees and Errors and Omissions Insurance premiums may be deducted as business expenses. If you have an office in your home, you can also deduct expenses associated with it, including a portion of your utility costs and mortgage insurance. For more information on reporting taxable income and self-employment tax, visit the Internal Revenue Service Web site at www.irs.gov or consult a tax professional. A Notary Signing Agent is a Notary specifically trained to facilitate mortgage closings. Mortgage lenders, title firms and escrow companies are paying Notary Signing Agent professionals to make loan closings as convenient as possible for borrowers by couriering loan documents, collecting and notarizing signatures and delivering settlement checks. And that means Notaries are being offered an opportunity to make a good living as an independent entrepreneur. |
Roland E. PaquetteMy work experience includes skills and experience as a certified real estate salesman, paralegal, and Notary Public. Archives
December 2019
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