Taxpayers have to file copies of their federal returns with the state. The state taxation department in turn makes a record of all Schedule C filings and sends them to commissioners of the revenue. The commissioners' offices then check the names on those filings against their own databases of license-holders. One of the first jobs is to check where the business actually is located, Hoer said.
"A lot of times, we'll have a name of someone who lives in Roanoke County, but the business is in Roanoke city," he said. Sometimes, business owners have paid the license but forgotten to update their addresses. Sometimes, the business owner reported income from a limited liability company or partnership that already paid the license.
Sometimes, though, people simply don't realize they needed a license.
"If you mow some lawns or you have a hobby that makes you some money, you might not think you're a business," Hoer said. But if you report that money to the IRS, as you're supposed to, then you are.
That can bring a surprising business lesson.
It's a lesson that Casey, and others who declined to speak for the record, have quickly learned.
"The tax isn't that much on my instruments," Casey said. "But anything I buy now to improve my gear is going to go onto Schedule C, which the city is going to see eventually and say well, you show this gear, now you have to pay taxes on this gear forever, (or) till you sell it. So I don't see myself upgrading anything."
Given the choice to do it over, he said he still would want his band on the arts commission touring list.
"We play some really cool gigs, like a high school, middle school auditorium full of kids," he said. "We're introducing them to Django. They've never heard of this guy. They've never heard the music. I love that."