Wedding Photographer's Fees Subject to Tax in Alabama

Friday, October 10th, 2014


The Alabama Tax Tribunal recently released its decision that a wedding photographer's fees were taxable.

The taxpayer sold wedding photography packages. Packages included combinations of products and services, such as photography services for the wedding day, an online gallery for viewing photos, engagement and bridal photography sessions, DVDs of photos, physical wedding albums, and printed photos. If customers cancelled within four months of the wedding, the taxpayer would refund only the amount it attributed to the tangible products. The taxpayer considered the rest of the amount a nonrefundable charge for setting the date aside. For example, for a $3500 contract, the taxpayer would refund $500. The $3000 was the charge setting the date aside.

Alabama taxes the gross proceeds from sales of tangible personal property. Taxable property includes printed photographs and albums. Taxpayers may not deduct labor or service costs from the gross proceeds of a taxable sale.

The Tax Tribunal ruled that the taxpayer's entire photography charges were subject to tax. The fees obligated the taxpayer to perform the labor and services needed to create taxable property. It did not matter that the taxpayer could keep part of the fees if the customer cancelled the contract. The fees were still for the taxpayer's labor to create taxable property and were thus subject to tax.

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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

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