I was contacted today about using some of our photos in a local magazine. It's sort of a "chamber of commerce" type magazine for a small recreation area.
Assuming they would be willing to purchase photos for publication, I have absolutely no idea what price to ask for or start with for negotiation.
How do you price photos for various inquiries like this?
All input is appreciated. Thanks!
mikeway said
10:35 PM Dec 29, 2007
Howard,
this single question tends to generate dozens of response each time it comes up in the photo forums, and it comes up about once a week.
My own guesstimate is between 25 and 50 dollars for ONE TIME usage. If they wish to keep and reuse then it should be adjusted upward. Check your smugmug gallery and price them there easing downloading and previewing issues.
If you were an award winning National Geographic photographer then, of course prices would be 10 to 15 times higher.
Mike
Roz said
06:22 AM Dec 30, 2007
Greetings, Howard, and Happy New Year to you and Linda!
Having spent nearly half of my years behind a camera for financial gain, I may be able to help, and then again . . . maybe not.
Even 30 years ago, when someone contracted for a particular photograph the price depending on the complexity, travel and time consumed, averaged $40 to $70 or even more.
Considering the information you provided -
The photos were not contracted for, which makes them "stock photography".
Need always plays in to value. A "Chamber of Commerce type magazine" has experessed the need, but need is also dictated by resources available. Most COC usually do not have large budgets for this type of endeavor, if a budget at all for a "small recreation area".
Mike is very correct as to one time usage or exclusivity of the image.
My suggestion-
Since your image(s) can be transferred electronically not involving work on your part, you may consider allowing one time usage of the image(s) gratis as a goodwill gesture, butrequiring a "Photo Credit" be published, which could lead to the beginning to more lucrative photograph sales.
What you get out of it, is a legitimate tax write off, knowing you did something personal for the "cause" with the possibility of something down the road (pun intended) as to future purchases by others.
The value for write off can be determined, within reason, by yourself. Had they retained someone to create the image, it is reasonable that a photographer might well have to travel, time the event for specific lighting and even possibly for the availability of wildlife, etc. All of this adds to the value you would establish. Sending them an invoice showingthe amount and a statement donated to the COC is sufficient as a legitimate record of your dontation.
The amount you may write off most likely would far exceed what they are able or willing to pay for usage of your image. Additionally, that amount would then be taxable, reducing hyour actual gain.
Just my thoughts and suggestion, Im sticking to it.
Charles
Sunseeker said
03:58 PM Jan 2, 2008
I beg to differ with Charles' advice regarding the measure of an income tax deduction for donating a photograph to the Chamber of Commerce.
Although the charitable deduction for contributions of property is generally measured by the fair market value of the property, the deduction for ordinary income property is limited to the taxpayer's basis in the property.
See Internal Revenue Regulations:
IRC Reg.§ 1.170A–4 Reduction in amount of charitable contributions of certain appreciated property.
(a) Amount of reduction. Section 170(e)(1) requires that the amount of the charitable contribution which would be taken into account under section 170(a) ... In the case of a contribution by an individual or by a corporation of ordinary income property, as defined in paragraph (b)(1) of this section, by the amount of gain (hereinafter in this section referred to as ordinary income) which would have been recognized as gain which is not long-term capital gain if the property had been sold by the donor at its fair market value at the time of its contribution to the charitable organization, ...
(b) Definitions and other rules. For purposes of this section: (1) Ordinary income property. The term ordinary income property means property any portion of the gain on which would not have been long term capital gain if the property had been sold by the donor at its fair market value at the time of its contribution to the charitable organization. Such term includes, for example, property held by the donor primarily for sale to customers in the ordinary course of his trade or business, a work of art created by the donor,...
Also, the Pension Protection Act of 2006 greatly increased the substantiation requirements for charitable contributions.
Cheers! Sunseeker
RVDude said
07:19 PM Jan 2, 2008
I think we are thinking two different interpretations here... And BOTH are right. Disclaimer, I am NOT a tax attorney or CPA.
Seems both folks are correct, it is all in how you, the "photographer" declare your reason for taking the picture.
My take is that 1) roz/charles is suggesting a real "cost of doing business" business expense that is then given away for marketing purposes and 2) sunseeker is talking a pure charitable donation.
Yep, two very different tax rules. The first is the act of conducting a legitimate business transaction (taking the picture) and then giving it away in the hope of generating future business - a marketing purpose. The second is pure and simple donation. I am no tax attorney, but if I am in the picture taking business and gratis a job, I suspect that pretty clearly allows me to expense all that went into that job. If I was not in the photography business and was just giving the COC a picture I had laying around then that's a different story of the charitable donation variety.
Anyone??? Anyone???
Sunseeker said
10:25 PM Jan 2, 2008
I agree with RVDude, intent matters. (RVDude said, "declare your reason", the Internal Revenue Code and associated cases refer to intent) Howard began the query by stating that the COC was interested in buying photos that he had taken ("our photos"), not that the COC would be commissioning him to take photos. That is his stated intent at the time of the transaction, selling existing property. As I have told many law students, "yes, the words really matter".
I agree that a "real cost of doing business" experienced by someone who is in the business of selling photographs results in a legitimate business expense, that may be offset by other revenue in the same business ( a business deduction from gross income). However the real cost of doing business is the actual cost of doing business, not some phantom value ascribed by the taxpayer. Charles wrote and I responded to: "The value for write off can be determined, within reason, by yourself. Had they retained someone to create the image, it is reasonable that a photographer might well have to travel, time the event for specific lighting and even possibly for the availability of wildlife, etc. All of this adds to the value you would establish. Sending them an invoice showing the amount and a statement donated to the COC is sufficient as a legitimate record of your donation." This is simply not correct.
Hypothetically, if Howard is in the business of selling photos, which might be an extension of his website business, then mathematically the income tax result of a legitimate business expense resulting in a tax deduction from the gross income of the business or a charitable deduction is the same, i.e. the basis in a self-produced item would equal the actual cost of doing business related to that item. In either case, there is no deduction for the value of the individual’s labor. (This analysis does not address depreciation which is merely a timing issue. Given Howard has already told us that his camera is a business expense of, I think, his web-business, presumably deducted under Section 179, there is no further depreciation deduction available.)
By the way, I am a tax attorney. However once I tell you that, [yes, this is an actual requirement] pursuant to U.S. Treasury Department Circular 230, I am required to inform you that any federal tax advice contained in this communication was not intended or written to be used for the purpose of avoiding tax penalties imposed under federal law. To obtain penalty protection, the new Regulations require attorneys, accountants and other tax advisors to perform increased due diligence to verify all relevant facts and to format the written tax advice in a lengthy number of separately enumerated sections with numerous disclosures.
Cheers Two!
Sunseeker
Tim & Robyn said
05:47 AM Jan 3, 2008
Isn't our tax code wonderful? NOT! How much time and energy do we all waste wrestling with questions like this? This is one of the reasons why I support the FairTax.
Roz said
10:59 AM Jan 3, 2008
Guess my first post attracted “incoming”, as it was not expressed as well as those following.I not only appreciate the subsequent posts by Sunseeker and RVDude, but also agree with them.
I do think that since Howard has a Smug Mug account, and sells images on the RV-Dreams Calendars, the sale of “stock photography” could well be considered in the realm of is entrepreneurial endeavors.
By performing a Google search using the words “stock photography”, one can quickly determine the “going rate” for photographic images.And I agree, there is likely to be a significant range in the prices commanded.
The purchasers of photography from stock houses are willing to pay premium rates, as they can obtain immediate access to an image without any consideration of weather, proximity, availability of certain wildlife, etc.This, alone, causes prices to fluctuate considerably.
In essence, this is what Howard would be doing . . . providing “stock photographic images” he owns.
My main point was, likely the COC desiring use of Howard’s image most likely had little budget.A single sale of $25 to $50, as Mike had mentioned, could well prove to be more laborious in complying with the IRS statutes that Sunseeker and RVDude quite aptly brought to the discussion than the monetary gain from transacting a sale.
And yes, such a gratis can, and has been, considered a marketing expense for photographers to gain exposure within a market.
One key phrase I found defining in the statute quoted was “Such term includes, for example, property held by the donor primarily for sale to customers in the ordinary course of his trade or business, a work of art created by the donor,...”Stock photography is considered the sale of created photographic art.
As both Sunseeker and RVDude pointed out, the complexity of meeting requirements by the IRS is not a simple thing and even, sometimes is open to interpretation.
Charles
RVDude said
12:11 PM Jan 3, 2008
Great thread and great posts. Thanks all for chiming in.
Online forums have a huge shortcoming: It is often impossible to discern the difference between "conversational grammar" and "technical grammar." When the range of forum topics goes from soup-to-nuts and the range of responses range from "off the cuff" all the way to "sharpened pencil" and then all these are mixed together, it is usually impossible to understand the desired intent. Isn't that even more fun than the tax code????
We have a great community here as evidenced by this thread!
I was contacted today about using some of our photos in a local magazine. It's sort of a "chamber of commerce" type magazine for a small recreation area.
Assuming they would be willing to purchase photos for publication, I have absolutely no idea what price to ask for or start with for negotiation.
How do you price photos for various inquiries like this?
All input is appreciated. Thanks!
this single question tends to generate dozens of response each time it comes up in the photo forums, and it comes up about once a week.
My own guesstimate is between 25 and 50 dollars for ONE TIME usage. If they wish to keep and reuse then it should be adjusted upward. Check your smugmug gallery and price them there easing downloading and previewing issues.
If you were an award winning National Geographic photographer then, of course prices would be 10 to 15 times higher.
Mike
Need always plays in to value. A "Chamber of Commerce type magazine" has experessed the need, but need is also dictated by resources available. Most COC usually do not have large budgets for this type of endeavor, if a budget at all for a "small recreation area".
Mike is very correct as to one time usage or exclusivity of the image.
My suggestion-
Since your image(s) can be transferred electronically not involving work on your part, you may consider allowing one time usage of the image(s) gratis as a goodwill gesture, butrequiring a "Photo Credit" be published, which could lead to the beginning to more lucrative photograph sales.
What you get out of it, is a legitimate tax write off, knowing you did something personal for the "cause" with the possibility of something down the road (pun intended) as to future purchases by others.
The value for write off can be determined, within reason, by yourself. Had they retained someone to create the image, it is reasonable that a photographer might well have to travel, time the event for specific lighting and even possibly for the availability of wildlife, etc. All of this adds to the value you would establish. Sending them an invoice showingthe amount and a statement donated to the COC is sufficient as a legitimate record of your dontation.
The amount you may write off most likely would far exceed what they are able or willing to pay for usage of your image. Additionally, that amount would then be taxable, reducing hyour actual gain.
Just my thoughts and suggestion, Im sticking to it.
Charles
I beg to differ with Charles' advice regarding the measure of an income tax deduction for donating a photograph to the Chamber of Commerce.
Although the charitable deduction for contributions of property is generally measured by the fair market value of the property, the deduction for ordinary income property is limited to the taxpayer's basis in the property.
See Internal Revenue Regulations:
IRC Reg. § 1.170A–4 Reduction in amount of charitable contributions of certain appreciated property.
(a) Amount of reduction. Section 170(e)(1) requires that the amount of the charitable contribution which would be taken into account under section 170(a) ... In the case of a contribution by an individual or by a corporation of ordinary income property, as defined in paragraph (b)(1) of this section, by the amount of gain (hereinafter in this section referred to as ordinary income) which would have been recognized as gain which is not long-term capital gain if the property had been sold by the donor at its fair market value at the time of its contribution to the charitable organization, ...
(b) Definitions and other rules. For purposes of this section: (1) Ordinary income property. The term ordinary income property means property any portion of the gain on which would not have been long term capital gain if the property had been sold by the donor at its fair market value at the time of its contribution to the charitable organization. Such term includes, for example, property held by the donor primarily for sale to customers in the ordinary course of his trade or business, a work of art created by the donor,...
Also, the Pension Protection Act of 2006 greatly increased the substantiation requirements for charitable contributions.
Cheers!
Sunseeker
Seems both folks are correct, it is all in how you, the "photographer" declare your reason for taking the picture.
My take is that 1) roz/charles is suggesting a real "cost of doing business" business expense that is then given away for marketing purposes and 2) sunseeker is talking a pure charitable donation.
Yep, two very different tax rules. The first is the act of conducting a legitimate business transaction (taking the picture) and then giving it away in the hope of generating future business - a marketing purpose. The second is pure and simple donation. I am no tax attorney, but if I am in the picture taking business and gratis a job, I suspect that pretty clearly allows me to expense all that went into that job. If I was not in the photography business and was just giving the COC a picture I had laying around then that's a different story of the charitable donation variety.
Anyone??? Anyone???
I agree with RVDude, intent matters. (RVDude said, "declare your reason", the Internal Revenue Code and associated cases refer to intent) Howard began the query by stating that the COC was interested in buying photos that he had taken ("our photos"), not that the COC would be commissioning him to take photos. That is his stated intent at the time of the transaction, selling existing property. As I have told many law students, "yes, the words really matter".
I agree that a "real cost of doing business" experienced by someone who is in the business of selling photographs results in a legitimate business expense, that may be offset by other revenue in the same business ( a business deduction from gross income). However the real cost of doing business is the actual cost of doing business, not some phantom value ascribed by the taxpayer. Charles wrote and I responded to: "The value for write off can be determined, within reason, by yourself. Had they retained someone to create the image, it is reasonable that a photographer might well have to travel, time the event for specific lighting and even possibly for the availability of wildlife, etc. All of this adds to the value you would establish. Sending them an invoice showing the amount and a statement donated to the COC is sufficient as a legitimate record of your donation." This is simply not correct.
Hypothetically, if Howard is in the business of selling photos, which might be an extension of his website business, then mathematically the income tax result of a legitimate business expense resulting in a tax deduction from the gross income of the business or a charitable deduction is the same, i.e. the basis in a self-produced item would equal the actual cost of doing business related to that item. In either case, there is no deduction for the value of the individual’s labor. (This analysis does not address depreciation which is merely a timing issue. Given Howard has already told us that his camera is a business expense of, I think, his web-business, presumably deducted under Section 179, there is no further depreciation deduction available.)
By the way, I am a tax attorney. However once I tell you that, [yes, this is an actual requirement] pursuant to U.S. Treasury Department Circular 230, I am required to inform you that any federal tax advice contained in this communication was not intended or written to be used for the purpose of avoiding tax penalties imposed under federal law. To obtain penalty protection, the new Regulations require attorneys, accountants and other tax advisors to perform increased due diligence to verify all relevant facts and to format the written tax advice in a lengthy number of separately enumerated sections with numerous disclosures.
Cheers Two!
Sunseeker
I do think that since Howard has a Smug Mug account, and sells images on the RV-Dreams Calendars, the sale of “stock photography” could well be considered in the realm of is entrepreneurial endeavors.
By performing a Google search using the words “stock photography”, one can quickly determine the “going rate” for photographic images. And I agree, there is likely to be a significant range in the prices commanded.
The purchasers of photography from stock houses are willing to pay premium rates, as they can obtain immediate access to an image without any consideration of weather, proximity, availability of certain wildlife, etc. This, alone, causes prices to fluctuate considerably.
In essence, this is what Howard would be doing . . . providing “stock photographic images” he owns.
My main point was, likely the COC desiring use of Howard’s image most likely had little budget. A single sale of $25 to $50, as Mike had mentioned, could well prove to be more laborious in complying with the IRS statutes that Sunseeker and RVDude quite aptly brought to the discussion than the monetary gain from transacting a sale.
And yes, such a gratis can, and has been, considered a marketing expense for photographers to gain exposure within a market.
One key phrase I found defining in the statute quoted was “Such term includes, for example, property held by the donor primarily for sale to customers in the ordinary course of his trade or business, a work of art created by the donor,...” Stock photography is considered the sale of created photographic art.
As both Sunseeker and RVDude pointed out, the complexity of meeting requirements by the IRS
CharlesOnline forums have a huge shortcoming: It is often impossible to discern the difference between "conversational grammar" and "technical grammar." When the range of forum topics goes from soup-to-nuts and the range of responses range from "off the cuff" all the way to "sharpened pencil" and then all these are mixed together, it is usually impossible to understand the desired intent. Isn't that even more fun than the tax code????
We have a great community here as evidenced by this thread!
-- Edited by RVDude at 12:13, 2008-01-03