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Philadelphia Wants Bloggers to Pay $300 Registration Fee

This article was written by in Career and Work, Featured. 18 comments.

Though it was never intended initially, Consumerism Commentary and my writing is a business. I pay fees every year to ensure that the state in which I operate, New Jersey, is aware of my business. Business registration with the state is just one out of many possible fees governments charge entrepreneurs and small business owners. Some businesses require local licensing as well, for an additional fee usually paid to a city or a county.

Philadelphia requires freelancers to register with the city for an annual fee of $50 or a lifetime fee of $300. This fee, as many who are reporting on the issue misunderstand, is not an income tax, but some taxpayers who indicated on their most recent tax return they earned income from a blog, no matter how small, have received notices from the city. The letters inform them of the obligation to pay this licensing fee. Even those who were diligent to report as little as $11 in additional income from a website received a request for $50 or $300.

The city’s position is that bloggers who run advertising, or writers who provide freelance services for a site that carries advertising and share its profits, intend to earn income. Even if your blog hosting service publishes advertising by default, you could fall into the category of people targeted by the city’s licensing fee if you live in Philadelphia.

For the city, the delineation is obvious: if a blog includes ads, it’s a business; if not, it’s a hobby. There are other ways for blogs to generate income other than blatant advertisements, but the city is likely not sophisticated enough to sniff out most paid content unless the income is reported on a tax return. The solution is clear. If you intend to blog as a hobby, remove the advertisements or pay the licensing fee and admit your goal is to earn money, even if it is a negligible amount.

Another option is to call the city council and lobby for a change in the law. There may be an income tax exemption for the first $100,000 of profit from blogging income if a new law passes, but the licensing requirement and its $50 or $300 fee will not likely go away.

Should bloggers who see a profit of less than the fee for licensing be required to obtain the license as a freelancer? Is blogging different than any other business once the first cent is earned? Some businesses, even those that don’t exist solely online, lose money year after year, yet the licensing is still required.

Updated March 18, 2012 and originally published August 23, 2010.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 18 comments… read them below or add one }

avatar 1 Anonymous

I have to be honest, I agree with the city. They have the fee, it applies to freelance writers, which I think for-profit blogging are categorized as.

It’s the blogger’s choice to introduce ads and revenue generating material in order to make money on the side. If they don’t make $50 a year to cover the fee, then what’s the point in having ads?

I don’t think for-profit blogging is any different than other businesses.

Also, FWIW, I don’t agree with the fee itself, but since it’s there, bloggers should also follow the rules or remove all profit generating material.

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avatar 2 Anonymous

You’re referring to the small business license fee, which you’re right, is not a tax.

But it gets even worse. Once you pay that fee, you are also expected to file city tax returns every year for the city’s Business Profits Tax (BPT) and Net Profits Tax (NPT). There is no minimum amount of self-employed income that you have to earn before you’re susceptible to this tax. The majority of my income is self-employed income from writing (a very small amount of this is from blogging, and the rest is writing for corporations, newspapers, etc). I do pay these taxes every year, and I think I should pay them. But my partner also earns self-employed income–between $300 and $500 per year in royalties from a book he co-wrote that was published in 2000. He has to pay the BPT and NPT too. I don’t think he should have to pay a special city tax on that money because it’s too small to be anything more than gravy for our family.

I think it’s ridiculous that there’s no minimum. If you earn a few hundred bucks a year from blogging, royalties, selling basil from your garden to a restaurant, whatever, why should you have to file forms to pay what amounts to a very paltry sum in taxes? It’s not bringing in significant revenue for the city, and it’s a huge pain in the ass for the taxpayer.

I think $100,000 is too high a minimum, and it shouldn’t be specific to bloggers. I think anyone who is really doing this as a job should pay the tax, but not people who are doing it as a hobby that barely pays for itself. I’d be satisfied with a $20,000 or $30,000 minimum. Below that, it would be pretty hard to live on. Above that, it’s your job.

I know several small business owners who have moved out of the city to avoid the BPT and NPT. I am not going to do that. I am determined to raise my family in the city. But I do think the tax structure in Philadelphia as it stands discourages entrepreneurship, chases creative professionals away, and in the end is a hindrance to Philadelphia’s cultural and economic progress.

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avatar 3 Anonymous

$300 could be a lot of money for college student, or somebody working minimum wage and trying to start an online business. It’s not right to charge these people when they don’t make any money online yet.

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avatar 4 Anonymous

Such BS! Philly has enough problems, what are they going to raise with this licensing fee (which can be argued is a tax in disguise…if it walks like a duck)? A couple millions bucks IF THAT.

Philly has a lot of problems, maybe they shouldn’t worry about the waste and corruption going on in that city (or the fact that they are depending on Kolb as a QB lol)

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avatar 5 Anonymous

It’ll give them something to talk about at the upcoming Bloggy Boot Camp in Phillly. :-(
I used to live and work in Philadelphia. When I got married and moved across the river to Jersey I still had to pay a city wage tax because I earned my money in Philly. Apparently there is never enough money in that town.

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avatar 6 Anonymous

If I was a small blog and was contemplating adding ads – paying a city business privilege fee would definitely hinder my enthusiasm for going professional.

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avatar 7 Anonymous

As a graphic designer in Southern California, I must pay a business license fee whether I am profitable or not. The fee is charged for doing business, not for making a profit, and I must buy a license in every community where I do business.
Tax or not, we all want to live in nice, solvent communities and we all have to contribute toward that goal. That’s what makes a community!

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avatar 8 Anonymous

Solvent Communities? You think $300/blogger is going to solve philly’s problem?

Aren’t there localities all over Southern Cali that are going or are near bankrupt?

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avatar 9 Anonymous

@ Tom, I agree with this as well. If one gets paid for their services – be it writing or otherwise – they should register as a business and pay the fee.

It’s amazing how this is being pushed as the city’s attack on bloggers and writers.

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avatar 10 Anonymous

This is an infringement on freedom of speech. Most bloggers don’t make money off of their opinions. Even if they do, its not going to cover the cost of a “fee” to have the “privilege” of putting their thought in a public forum.

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avatar 11 Luke Landes

I don’t see any infringement on free speech. Bloggers in Philadelphia can continue publishing their thoughts for free, as long as they don’t attempt to earn an income from doing so.

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avatar 12 Anonymous

Please don’t give NJ anymore ideas on how to tax us even more.

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avatar 13 Anonymous

it doesn’t matter wether you’re big or small, and it doesn’t mean taxing is solving or not financial problems of a city.
What matters is that business is taxed. And earning money through advertising, althoug just a few cents, should be taxed. Otherwise, you could consider abolition of all taxes :-)
I don’t care either about Philadelphia rules, I know the ones of my country.
The point is that bloggers are bloggers. But, as soon as they start earning a few dollars, they are also businessmen. Maybe poor ones, but that’s not the point.

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avatar 14 Anonymous

Plus, it’s easy to avoid those taxes or fees: stop accepting money for the adverts.
Or collect money for adverts, and then accept the rules of the game: to be taxed or feed.

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avatar 15 Anonymous

I don’t see any reason at all that bloggers who are in business of making money should be exempt from paying applicable license or business fees. $50 a year is not a significant amount.

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avatar 16 Anonymous

I completely agree.

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avatar 17 Anonymous

If there is an income tax EXEMPTION on the first $100K of blogging income, there is going to be a SURGE of new bloggers, which will be great for business!

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avatar 18 Anonymous

It’s ONLY $300. I mean, come on. The solution is that if you don’t think you can easily make at least $300, don’t put ads on your blog. I’m with the city on this one.

Now me, I’d gladly pay the $300 because I make many, many times that. Besides, it’s not terribly difficult to make $300 in a year on your blog if that’s what you’re trying to do.

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