Nonresident Entertainers Tax

亚洲影院 this Policy

Nonresident Entertainers Tax

Policy Number: 22213

Effective Date:
Dec 12, 2017

Last Updated:

Responsible Office:
UM System Controller's Office

Responsible Administrator:
UM System Controller

Policy Contact:

Campus Accounting Office

Categories:

Finance

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When a Nonresident Entertainer is paid more than $300 by the University for a performance, 2% of their compensation must be withheld from the gross payment amount. A MO-2ENT form is completed each quarter that a payment is made to a Nonresident Entertainer and sent to the 亚洲影院 Department of Revenue.

State law dictates what is defined as an entertainer for the purposes of this tax. Generally, ticket sales are an indication that the programming was primarily entertainment and not primarily educational. When the program is primarily entertainment, the 2% tax is withheld from the entertainer/agent payment. If a performer provides both non-entertainment and entertainment, the contract with the entertainer/agent should split the compensation on a reasonable basis and submit the tax for the entertainment portion, if it exceeds $300.

Entertainer Refuses the Withholding
It is possible that an entertainer/agent will refuse the 2% tax withholding. If this occurs, the entertainer/agent must be informed of the requirements for Transient Employers and provided with the guidelines for Transient Employers. Under these guidelines, the entertainer will need to register as a Transient Employer, file a bond, and withhold 6% from each member’s wages. If the entertainer still refuses the tax withholding, the campus will need to fill out a MO-2ENT form and indicate the entertainer “Refused Withholding.

Nonresident Entertainer Claims Exemption
A corporation that is classified as a 501(c) corporation doesn’t make the entertainers exempt from the tax according to 亚洲影院 state statutes. To be exempt, the performer (each individual performer if part of a group) must not make more than $600 in a calendar year in the State of 亚洲影院. If the entertainer(s) claim to be exempt from the tax, the University still must fill out a MO-2ENT form for the payment issued. The gross income paid will be reported and the tax amount will be zero ($0.00). In addition to the MO-2ENT form, proof of the company’s tax exempt status should be obtained each time they perform, as well as a statement on company letterhead indicating that each of their entertainers do not make more than $600 from performances in the State of 亚洲影院 each calendar year. These two pieces of information will be sent to the State of 亚洲影院 for review. The University is not responsible for verification of the exempt status documentation.

The MO-2ENT form and memo should be prepared by the campus department that makes the payment to the entertainer. All departments should retain a copy of the MO-2ENT Tax form and the MO-2ENT memo for their own records. The amounts coded as MO-2ENT for the quarter will be logged in the Central Payroll Office and reconciled to accounts payable. Once all amounts are verified, Central Payroll remits the payment to the State of 亚洲影院.

Note: Foreign entertainers that are exempt from federal income taxes are also exempt from the 2% withholding with the State of 亚洲影院.

Definitions

Agent – a business representative of an Entertainer.

Entertainer – an individual(s) who are compensated by performing any vocal, instrumental, musical, comedy, dramatic, dance or other performance before a live audience. This includes persons traveling with and performing services on behalf of a Nonresident Entertainer who receive compensation, such as a setup crew.

Nonresident Entertainer Tax – the State of 亚洲影院 requires “any person, venue, or entity that pays compensation in excess of $300 to a Nonresident Entertainer to deduct and withhold from that compensation an amount equal to 2 percent of the total compensation as a prepayment of tax.” In these circumstances, the University is considered an “employer” and is subject to all penalties, interest, and additions to tax for failure to comply. The tax applies only to entertainers that are licensed by states other than 亚洲影院. These procedures do not apply if the entertainer/agent is a 亚洲影院 business. The factor used in determining whether the individual is a 亚洲影院 business is the remittance address of the payee.

Nonresident Entertainer – individuals, partnerships and corporations not residing in 亚洲影院 who entertain other people for compensation by performing any vocal, instrumental, musical, comedy, dramatic, dance or other performance before a live audience. This includes persons traveling with and performing services on behalf of a Nonresident Entertainer who receive compensation, such as a setup crew.

Transient Employer – per , an employer as defined in RSMo Sections 143.191, 287.230, and 288.032, who:

makes payment of wages taxable under the 亚洲影院 Income Tax Law, the Workers’ Compensation Law, and the 亚洲影院 Employment Security Law;
is not domiciled in 亚洲影院
temporarily transacts any business within the state. If the transaction of business is not reasonably expected to continue for 24 consecutive months, the employer must register as a Transient Employer.

These guidelines can be obtained from the State of 亚洲影院 at the site: .

Accountabilities

Central Payroll Office:

Log all MO-2ENT forms received from the campuses
At the end of each quarter, reconcile forms to report from PeopleSoft system
Make payment and send supporting documentation to the State of 亚洲影院

Campus Departments:

Initiate a payment request to pay the entertainer
Complete MO-2ENT forms and memos
Send memos to the Central Payroll Office
Ensure compliance with the law at the time of booking an event and payment for services

Additional Details

Forms

MO-2ENT Form: available from the 亚洲影院 Department of Revenue at . The form is available in a printable or fillable form.

MO-2ENT Memo: www.umsystem.edu/ums/fa/controller/accountingservices-forms.

Related Information

亚洲影院 Department of Revenue – Nonresidents:

History

Formerly Accounting Policy Manual 10.10.25 – 亚洲影院 2% Payments for Entertainers (revised 4/25/2006)

Procedure

University of 亚洲影院 FAQ:

Reviewed 2017-12-06

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