Kacy,

Please explain to me how you figure that marking up fees is “dishonest”. My company has a published rate card upon which every charge is disclosed up-front before any work is performed. Do you ever ask how much the retailer pays for the items you buy there? Is Wal-Mart being dishonest when it buys a pair of sneakers for $50 and sells them to me for $100? Is Domino’s “padding its invoices” when it charges extra for toppings? If your business model works for you, that’s fine, but calling your competitors’ integrity into question is a bit disingenuous in and of itself.

As to the tax consequence, it’s a non-issue if one is reporting all gross income and deducting only the actual amount spent for the copies. If one can produce receipts for the amount put out, there's nothing to worry about.

Regards,
Scott Perry