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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
Satisfied Customers: 585
Experience:  10 years experience
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I belong to a community that is and over. We have

Customer Question

I belong to a community that is for 55yrs and over. We have a club house and the developer is charges a fee for entertainment events. Some events earn a profit, are we resonsible for paying tax on the balance (profits) or is the developer responsible
Peter XXX
Submitted: 2 years ago.
Category: Tax
Expert:  emc011075 replied 2 years ago.
Hi Peter. My name is ***** ***** I will be happy to help you. It depends who is receiving the fees and generating the profit. If it is you, than you will be responsible. If it is the developer, than he is responsible.
Expert:  emc011075 replied 2 years ago.
Fees collecting for providing services (including entertainment) and generating profits would be considered Self-employment income and would be reported on Schedule C.
Expert:  emc011075 replied 2 years ago.
Let me know if you have any questions.
Expert:  emc011075 replied 2 years ago.
I see you offline now. So if this answered your question, please take a moment to rate my response so that I may receive credit for assisting you today. However, if you need clarification, or want to discuss this issue further, let me know. Thank you.
Customer: replied 2 years ago.
Let me restate my question. we pay dues to an HOA we have a club house which is part of the amenities. our social director collects money for the events that take place in the club house. Some of the events make a profit, Our HOA management company does not collect any fee's for these events, they are run boy the developer the developer does not allow us to review the books so we can see where the extra money is going. And is the profit taxable.
Customer: replied 2 years ago.
is there anyone on line
Expert:  emc011075 replied 2 years ago.
yes.
Customer: replied 2 years ago.
can I get a reply to my last statement
Expert:  emc011075 replied 2 years ago.
Yes, just give a minute.
Expert:  emc011075 replied 2 years ago.
Ok. It seems like the developer is the one who is organizing the events and making profit. The developer will be responsible for claiming the profit and paying the tax.
Customer: replied 2 years ago.
I believe he is not, because he won't let anyone see the books
Customer: replied 2 years ago.
Can i get the IRS involved.
Expert:  emc011075 replied 2 years ago.
The developer will have to account for his income and expenses associated with this activity. He is not obligated to share his bookkeeping with anybody. He makes money on this activity, he needs to report it. IRS will not get involved to investigate.
Customer: replied 2 years ago.
Not even to investigate if he is paying taxes
Expert:  emc011075 replied 2 years ago.
Well, you can report him. But do you know for sure he is not claiming the income? He doesn't share his tax return with you.You can call IRS fraud hotline at(###) ###-#### ***** IRS will not share results of the investigation with anybody. If he is not reporting the income he will get a letter from IRS asking about it.
Customer: replied 2 years ago.
can we speak at another time
Expert:  emc011075 replied 2 years ago.
certainly. Just return here and post your question. I will be notified by e-mail and you will be notified when I respond.
Expert:  emc011075 replied 2 years ago.
I am here often or if not I am checking in periodically. I am on EST so between 10am and 10p I am usually here.