Klarinet Archive - Posting 000485.txt from 1998/02

From: Agrenci@-----.com
Subj: Re: It's tax time (Why did you have to remind us?)
Date: Tue, 10 Feb 1998 13:53:09 -0500

In a message dated 2/10/98 10:29:33 AM, you wrote:
Dan Paprocki asks:

>I'm an professional musician and would like to know what other people do as
>far as deductions. I have receipts of almost all of my expenses from last
>year i.e. reeds, music, clarinet work, housing while on the road, audition
>expenses etc. My question is is there any AFM pamphlet or web site that
>has helpful information on how to claim these work related expenses?
>Exactly what can you claim? What do other professionals do? If you start
>adding up my work costs it comes out to a couple of thousand per year for
>me to work.

I do not know of a web site or pamphlet which deals with this specifically,
but I do recall that last year the International Musician ran an article or
two on this during tax season. Maybe they'll do it again, or perhaps you can
find back issues.

In any case here are a few things you may or may not be aware of. (Disclaimer:
I am not a "tax expert" and make no claim otherwise, but I have done may own
taxes for over a decade and have learned some strategies. Also, I have the
good fortune of teaching clarinet to an accountant at the present time who has
been very willing to answer some of my questions.)

1) You will need to divide your income into two categories: employee income
(reported on a W-2) and non-employee income (sometimes reported on a 1099,
sometimes not reported.) For non-employee income you must file a Schedule C.

2) It is best to deduct as many of your expenses as you can on the Schedule C.
This will save you on both self-employment tax and income tax. These expenses
should be related to that particular income, but for musicians that is a grey
area since we use the same equipment on any sort of gig. In most cases you can
deduct everything here assuming that you do have non-employee income.

3) If you do not have non-employee income, and your expenses are only a couple
thousand dollars, it may not pay to itemize these expenses since they might
turn out to be less than the standard deduction. I do not think that you can
take both a standard deduction and an employee expense deduction. Does anyone
else know for sure?

4) You can deduct pretty much anything music related. Some things my
accountant/student says yes to are: stereo equiptment, CDs, books, etc.

I hope some of this is helpful. Such a drag, isn't it!

Andy