S.W.A.N. CYGNETURE MAY 1996 NEWSLETTER

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CYGNETURE
The Newsletter of SWAN
May 1996

Self-employed Writers and Artists Network, Inc.

PRESIDENT'S MESSAGE

Thank you for serving SWAN

There have been changes at the helm. SWAN welcomes writer Patti Gandolfini as second vice president. Formerly the public relations director, she is already hard at work ironing out the details of our new WorldWide Web site. Taking over PR is writer Kate Bobby, who recently brought SWAN coverage in a Bergen County newspaper chain.

The board would like to offer its thanks for the hard work and perseverance of three retiring board members: trade show director George Peirce, a photographer; special events director Wally Littman, a designer; and vice president (formerly president), Mike Biegel, an illustrator. The entire membership owes them a huge thank-you for making SWAN one of the largest and most important commercial communications organizations in New Jersey.

WHAT YOU MISSED

SWAN is now on the Internet

Is the Internet a valuable advertising/promotion medium that will convey the skills of SWAN members to a broader business community? Or is it simply the latest "hot" medium that members must use to stay current with the rest of the business world?

Over the next year, an effort led by vice president Patti Gandolfini will find out. The SWAN board has approved joining the World Wide Web. The name of the SWAN website is: http://www.swan-net.com

The site has been established and designed by Stan Cohen as SWAN webmaster. Included on the site will be membership and referral information, the Code of Performance, meeting information, Cygneture, etc.

Members will choose if they want a listing at the SWAN site. (New members will be added immediately.)

Under Phase II, members will be asked if they also want a portfolio page on the SWAN site, at an annual cost of $20 for four images, or $40 for 10. To convert text and graphics for these pages into digital information,Ted Thomas is organizing SWAN photographers to perform this service. Another group will design web pages for members. Costs for both services will be minimal.

UPCOMING EVENTS

Come to The Pricing Game

Do you know what fee to charge when you are asked to bid on a job? This is the meeting that helps you set your prices. Each member may submit two projects, along with its purpose, its deadline, its complexity, the hours and travel required, and the fee received.

When you attend the June 19 meeting at 7:30 pm at the Bergen Museum, you guess the fee received for each project, and are later told the actual fee paid. This enable you to evaluate your own rates.

Send your examples (slides if available) to:
For graphics:
Deb Hoeffner
538 Cherry Tree Lane
Kinnelon, NJ 07405

The Sales Tax Brouhaha

Should you be charging your clients a sales tax? At the April meeting, members heard the views of Joe Dietz, president of J.M. Kesslinger & Associates and tax consultant Alan Preis, CPA, Florham Park.

They are key figures in the Advertising & Communications Sales Tax Coalition organized by Dietz. The coalition has been working with the New Jersey Division of Taxation to establish ground rules for when to charge a sales tax and when not to.

They cautioned that their following interpretation of the rules is based on current discussions, and will not be final until the state signs off on an agreement. They also note that if your client is not an end user, you must obtain an ST-3 resale certificate to prove your work is exempt from the sales tax.

For writers, the end use of copy is a key. Copy written for the education or training of corporate employees probably requires no sales tax. Copy for internal communications and for books or magazine articles is under discussion, while copy for newspaper and magazine ads is exempt from a sales tax. BUT ad copy written for radio or TV, or copy for promotional brochures, fliers, and direct mail, does require a sales tax.

For photographers and illustrators, the state currently considers all sales of photographs and illustrations to be a sale of a tangible product, with a sales tax required.The Coalition has proposed that if you license use of your work but retain the original, a sales tax is not required.

For designers, selling a design to an end user (except for magazine or newspaper ads) usually calls for a sales tax, but Dietz and Preis are seeking further consultation with the Tax Division in this area.

Also, if you work for a client out of state, never visit that state, and ship to that state, no sales tax is required. BUT if you meet with the client in New York, for example, and do all the work in New Jersey, you must collect a New York sales tax for the material delivered to New York.

In general, selling tangible property requires a sales tax, while selling a service does not-unless state law says so. And in 1970, the legislature passed a law that says all advertising services, which includes PR in the state's view, are subject to a sales tax, unless exempted. Exempted are magazine and newspaper ads, out-of-state services, services for not-for-profits, and education and training services for employees.

THE TAX AMNESTY

Should members take advantage of the New Jersey tax amnesty that will expire on June 1? The state expects to raise half of the anticipated $70 million from unpaid back sales taxes.

If you are uncomfortable about your status, Preis said,"consult your tax advisor. This is the best time to seek amnesty, because there is no penalty and no interest charged." If you do not seek amnesty, and start charging a sakes tax once agreement is reached , he said, whether the state pursues you for back sales taxes will likely depend on whether your work is in the "gray" area of the coalition's discussions with the state. If you clearly should be charging, he said, the state will likely pursue you for back taxes.

Again, he cautioned that all statements are subject to the final agreement with the state, and the question of back sales taxes is still under discussion.

SWAN is a member of the Coalition, which is currently seeking services or donations for a manual that will detail the agreement reached with the state. Donors will receive a free copy of the manual. For further information, call Joe Dietz at (908) 686-2220. -RAP

Largest Directory Yet

Look for the SWAN Sourcebook out this month. It will be the largest in history, with 117 members and 8 associates members, for a total of 125.

The printing of 5,000 copies will be donated by Printastics of Clifton. Copies will shortly be shipped to more than 3,000 potential business customers.

CYGNETURE The Newsletter of SWAN May 1996