MLMNews Breaking Now – California House Passes Network Marketing Tax Bill

This was originally posted by Troy Dooly on June 30th, 2009 at ACES Radio Live and the MLM Help Desk

XanGo’s announcement on the new California “Tax Withholding Bill” will effect all MLM distributors if it becomes law. Thank you Bob Freeze – V.P. of XanGo Corporate Communications for sending out this great advice.

Read the below email and follow the directions. This is for every Distributor in the Network Marketing profession.

CA Withholding Tax

Dear XanGo (All MLM Distributors) Distributors:

The California Assembly passed SB 17 on a majority vote yesterday (June 28th) which contains a provision for a 3% withholding on independent contractors. If this bill becomes law, XanGo (ALL Network Marketing Companies) will be required to withhold 3% of your monthly check and remit this amount to the state.

We are voicing our strong opposition to this bill because, if enacted, it will decrease the size of your monthly checks and create substantial administrative burdens and expenses for XanGo (All MLM Companies). Throughout history, across the country, direct sellers as well as other independent contractors have been exempt from withholding taxes because many of their expenses are deductible. This legislation sets a dangerous precedent that other states and even the Federal Government could follow.

If you share our concerns, please voice your opposition to this bill ASAP by contacting the Governor and Senate President Pro tem Darrell Steinberg and let them know how you feel. A sample letter appears below for your convenience, but your communication will be most effective if you use your own words. Contact information for the Governor and Senate President also appears below.

Please take a moment to make your voice heard in Sacramento! Ask Governor Schwarzenegger to veto this bill!

Sincerely,
Bob Freeze
vp – corporate communications

The following is the Governor’s contact information:

Governor Arnold Schwarzenegger
State Capitol Building
Sacramento, CA 95814
Phone: 916-445-2841
Fax: 916-558-3160

To email the Governor, please click here

The following is Senate President Pro tem Darrell Steinberg’s contact information:

Senate President Pro tem Darrell Steinberg
State Capitol, Room 205
Sacramento, CA 95814

To email the Senate President Pro tem, please click here

SAMPLE LETTER:

Dear [             ]:

Withholding on independent contractors, like me, a XanGo Distributor, would place a large burden on my family. Unfortunately, once again, the California Legislature is considering an independent contractor withholding proposal.

[Tell your personal story in your own words] I have been a XanGo Distributor for more than [Insert the number of years you have been working with your company] years. Originally, I enrolled with XanGo because I liked the products and wanted to earn some additional money. Now my family depends on this extra income to supplement our budget.

I am not opposed to paying my share of taxes, but it makes no sense to me to send the state my money and then have the State send it back to me when I file my tax returns. I need every dollar I make to run my business. I have to pay my business expenses from the commissions I earn. While I of course support the need to pay taxes, withholding up front on taxes I may never really owe will cause severe cash flow problems for me. My business is already difficult enough. If you burden us with more administration and paper work it only serves to make the business more difficult and less attractive and therefore it will be more difficult to grow my business.

In the end, the State will not end up with any more money. If you do consider a withholding proposal, I request that you exempt direct selling companies like XanGo.

Please do not sign any budget resolution that contains independent contractor withholding for direct sellers. It would hurt my family and my business as well as tens of thousands of others in my occupation.

Sincerely,
XXX

Take action today!!!!!!!!!!!

Never Give Up,

Troy Dooly
The Maverick Leader

Distributors Rights Association