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I need advice on whether my DJ business should be a referral agency or have subcontractors and pros and cons?

I am starting a DJ business and I need advice on how to properly run it. I have six DJs that are in it with me, but I really don’t want to classify them as employees rather independent contractors or subcontractors. Should I classify my business as a DJ referral agency where I would find clients for the DJs and charge the DJs a finders fee (or charge the clients a finders fee?) The other way is to classify myself as a DJ business itself, but have each DJ as an independent contractor or subcontractor and I get a percentage or a cut out of each event I get them . Which would be the best and most practical way regarding taxes and legally? I understand that being the person getting these DJs gigs they must fill out a W9 and I will be the one to send them a Form 1099 at the end of the year, is that correct? If I’m the one getting income from percentage or finders fee would I need to claim that as income at the end of the year? Please help. Thanks.

IRS web site: PUB 17

Gross income. This includes all income you receive in the form of money, goods, property, and services that is not exempt from tax. It also includes income from sources outside the United States (even if you can exclude all or part of it). Common types of income are discussed in Part Two of this publication.

If you are going to 1099 the DJ’s then you are more of a broker for services. You work out the fee for service from the client looking for the service and then you separately work out what you pay your sub contractor DJ to perform that service this will allow a 1099 to them and it becomes a cost to you. You will only have to worry about the tax implications on the profit. On the other hand your DJ buddies will have to worry about their own tax situation. They need to make sure they are keeping track of expenses and figuring self employment tax for themselves and you worry about yours.

A tax pro can help you set up your business and if they are a full service office they can even keep your books in order. If you would like to do more research on your own you can start with the IRS website:
look for Publication 583

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