Notary and Signing Agent Taxes: What Is Exempt From Self-Employment Tax

If you earn money as a notary public or loan signing agent, your taxes work a little differently from most side businesses. Some of your income gets special treatment. Not all of it.

Report it as income

According to the Taxpayer Advocate Service, notary fees are generally not subject to self-employment tax, but you must still report them as income. Report them by the filing deadline for the year you received them.

What is exempt and what may not be

Generally exempt from self-employment tax: fees for official notarial acts.
May be subject to self-employment tax: fees for travel, printing, courier work, document handling, and administrative work.
Loan signings: the notarial portion is treated as notary fees. Other signing-agent services may be separate and may be taxable.

The forms you receive may not split these out. Forms 1099-NEC, 1099-MISC, and 1099-K can report gross or combined payments, even if part was for notarial acts. Separate the amounts yourself before you file.

How to report

If you are self-employed, report income and expenses on Schedule C. Review Schedule SE to see which income is subject to self-employment tax. The Taxpayer Advocate notes that if notary fees are your only Schedule C income, you generally should not file Schedule SE solely because of those fees. Your other self-employment income can change that, so check with your preparer.

Keep records

Keep:

Invoices and receipts
Payment app and bank records
Your notary journal entries
Mileage and travel records, see how to keep a mileage log
Records showing what you charged for each service

Mistakes to avoid

Underreporting income, or wrongly excluding income that is subject to self-employment tax, can lead to IRS notices, additional tax, penalties, and interest.

Also remember that the income tax still applies. If you earn enough from notary work, plan for estimated taxes.

Need help splitting your income? Book a call with FlowTex.

Sources

This article is general information, not tax advice. Talk to a qualified professional about your situation.