The city of Philadelphia is demanding money from bloggers who were honest enough to report the meagerest – $11, $50 – of revenue from ads or donations.
According to the law, any blogger who enables advertising is required to register as a business, pay for a license and pay taxes on their profits no matter how small, the Philadelphia City Paper reported last week.
Philadelphia requires a license for the privilege of doing business when there is «activity for profit,» a tax attorney told the paper, even if the activity did not earn a profit the year before or may never turn a profit.
The license is $300 for a lifetime or $50 a year.
But the city only knows about the ads you’re placing on your freely-hosted blog if you report that income on your taxes.
At least two small-time bloggers are being asked to pay the price for their honesty. Marilyn Bess earned $50 between a few articles on eHow.com and her WordPress-hosted blog about green living. She got a letter from the city demanding she pay $300 for a license plus taxes on her profits.
As Barry wrote on his blog Friday
I never expected Circle of Fits to «make money» or be deemed a «business»… I put ads on it as an experiment, and I don’t ever expect anyone to click on them..I don’t even know how to put the time in to learn how to control which ones are being presented.
Bloggers are just a subset of workers affected by this regressive tax. According to the city’s strict rules, any freelancer based in the city qualifies as a business and needs to get the license.
What are the rules for microbusinesses in your city?