How To

How to Take tax Deductions as a Performer

Contributor
By eHow Contributing Writer
(0 Ratings)

In the sixties, the performer Liberace convinced a court that buying rhinestone-studded suits for his act was a legitimate tax deduction. Even if you don't spend thousands of dollars on your stage outfits, even small career-related deductions can lower your tax bill.

Difficulty: Moderate
Instructions

Things You'll Need:

  • IRS Schedule C form, for self-employment income
  • File folder for receipts.
  • Form 4562 for depreciating assets.
  1. Step 1

    Keep receipts and records of everything you spend as a performer. This includes mileage, hotel bills, stage makeup, band instruments and educational material.

  2. Step 2

    Deduct all expenses for overnight travel from your performing income. This includes 50 percent of the cost of meals eaten on work-related trips.

  3. Step 3

    Take a tax deduction if you use your vehicle for your career. You can multiply total miles driven by the IRS per-mile deduction or use the actual costs of gas and repairs.

  4. Step 4

    Reserve one room of your home as your office or recording studio. That lets you claim the home-office deduction for a percentage of your rent and utilities.

  5. Step 5

    Claim a tax deduction for anything you bought for your career. As a performer, this can include sheet music, printer ink and stage makeup or clothes. Major equipment such as guitars or electronics must be depreciated using IRS form 4562.

Tips & Warnings
  • Musicians can deduct concert tickets and CDs as a necessity for learning about the music industry. Other performers can do the same in their field.
  • Expenses have to be necessary, ordinary and "not extravagant" to be deductible. The IRS won't be happy if you try to pass off luxuries as deductible expenses or deduct for a huge number of concerts.
  • If your performing expenses outweigh your income, you can deduct the loss from your regular income. If you do that year after year, the IRS will count performing as a hobby and disallow the deduction.

Post a Comment

Post a Comment

Have you done this? Click here to let us know.

I Did This

Related Ads

Personal Finance
Mark P Cussen, CFP, CMFC,

Meet Mark P Cussen, CFP, CMFC eHow’s Personal Finance Expert.

Copyright © 1999-2009 eHow, Inc. Use of this web site constitutes acceptance of the eHow Terms of Use and Privacy Policy.

eHow Personal Finance
eHow_eHow Business and Finance