Several house concert presenters have recently been contacted by the IRS about witholding tax on monies paid to performers. Also some state tax agencies, most notably California are doing likewise. The house concert performers are claiming that the musicians are independent contractors and therefore not subject to the witholding tax. In this case the IRS wants the hosts to issue a form 1099. The house concert hosts have counter claimed that they put out a donation jar which is turned over to the performer after the concert and do not handle any money or even know how much is in the jar. Therefore it is the performer's responsibility to declare it and not the host's.
California is also looking to collect sales tax on the merchandise and CDs that the performers are selling during the house concert. Other states may follow suit.
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