Talent agency filing taxes from money made on a movie, but W2 was given to client?

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Hi all - We are a small talent agency and our clients have gotten booked on a number of movies this year. The check was addressed to both us and the client. We cash the check, and expense out the client their part, and keep our agency fee.

The W2 goes to the client of course, but we send out the 1099 to the client that we expense out to them. Is this the correct way to do it? We feel like we are missing something b/c the client's W2 would say they made $12,000 for instance but in actuality they only made $10,000 because $2,000 is for management. But then we send out a 1099 for $10,000?

Any advice would be greatly appreciate!

VolvoGirl

Level 15

So who issues the W2?

azhiajanayAuthor

Level 2

The production company of the movie.

TomYoung

Alumni - Champ

I can't understand why an actor would get a W-2 in the first place. I'd think they would always be independent contractors: they're hired for a specific project and understand that when the project's over the money stops, and the actor determines how they're going to do what they do.

Critter

Level 15

If the payer is treating them as an employee and withholding the FICA taxes then they would file a W-2. But if there were no taxes withheld then they are not employees as you said ... so in that case the payer should be sending out 1099-misc forms ... but will they send only 1 to you or 1 to the client or one to each of you ... that is the question that needs to be answered.

azhiajanayAuthor

Level 2

It's a unionized project through sag aftra, thats just how it is for the larger productions

azhiajanayAuthor

Level 2

They are treated as an employee and FICA taxes are taken out.

azhiajanayAuthor

Level 2

We fill out a check authorization form so that we can cash the check on their behalf so we are the middle man so we can get our portion before the client gets it. Our largest concern is that we may deposit $12,000 but we only keep $2,000 just wondering if we need to make a paper trail with the tax forms? So Critter#2 should the client be sending us a 1099? How do we show the monies we received?

Critter

Level 15

If the payer is not sending a W-2 then the next question is who are they sending what form ? Again once you know the answer to that we can tell you what to do next.

Critter

Level 15

Ok .. so if the client gets a W-2 then my original answer stands.