tax



	Before my arm was twisted and I was forced into the servitude of a radio station, I was an expert in the Income Tax Preparation field. I have done over 50 radio and television appearances, and over 100 newspaper articles written on all things to do with tax law and theory. That being said, I have written a brief article to share with you. These are some overlooked tax deductions that every musician should know about.

	Some of the top overlooked tax deductions that a musician faces are the same as that of any self employed person. Let's face it, If you are a musician, and you get paid for gigs, you are self employed. It doesn't matter if music is your first or second job. You are required to file a schedule C for your self employment income and pay self employment taxes if your earnings are over $400 in the calendar year.

	Often times, musicians include their instruments and costs of direct expenses, but forget a lot of other things that can really add up. For example, health insurance premiums for some musicians, are deductible Even if it is an additional health plan you pay to. Also if your bank charges you a penalty on early withdrawal of a savings account or certificate of deposit (CD) . If you pay alimony (not child support) you may be entitled to a tax deduction.

	If you play gigs across the border or overseas, the tax you pay to that government is deductible in the US. Dues paid to your local musicians union, or any professional organization related to your business of making music are deductible Newspapers, magazines and other publications of your trade are also deductible expenses.

	Cell phones required to run your music business while you are on the road may qualify as a deduction. So do cleaning fees for your outfits on the road. Don't forget travel, food and lodging while you are on the road. Meals are generally at 50% (without alchohol), but lodging and mileage can sure add up.

	If you perform for charity, your time is not deductible but any real expenses you incur are. If you donate an autographed mandolin to a charity, you can take a tax deduction for the fair market value of the mandolin as a charitable contribution. You can also claim 14 cents per mile for the trip to and from the charitable show.

	If an agency charges you for getting you gigs, or a promotion company bills you for distribution and P.R. fees, those are tax write offs! If you print flyers to promote a gig or festival you are playing at, you may deduct the cost of those. In the case of Musicians, expenses paid for classes, conventions, or workshops that help you to improve or maintain your musical skills can be used as a tax deduction. Dinner and a show while you're at such a workshop, is not.

	If you're buying or refinancing a house, make sure to include points in your interest paid. Points are considered interest for tax purposes. Avoiding payola all together, business gifts that you make to your dj friends, record company, club or venue owners, etc. are deductible if they are business gifts and they are $25 or less.

	I am always amazed at how many people forget to take a deduction for tax preparation fees. Whatever your tax preparer charged you to prepare last year's return, it's a deduction this year.

	Also, if you have overlooked a substantial amount of these deductions, you can amend your tax return and get a refund for up to three years from the filing date.

	Finally let me say a word about audits. I have been to hundreds. If you keep good documentation, audits are not a big deal. The IRS is going to check your facts, especially if you have high expenses. Don't be afraid of an audit if you can prove your deductions. Keep receipts keep a mileage log in your car or van (bus) when you go to gigs. Ask for receipts from charities for donations. They are happy to provide them.

	Being a musician and paying the bills are hard enough. Keep as much money in your pocket as you can and make tax time a little easier on your wallet.. This list is not meant to be all inclusive, but it gives you some deductions to track and ask for. For more help with your taxes, visit a professional tax preparer near you.

	Marc Baum is the General Manager of Green Mountain Music Productions. He is also a published songwriter and columnist as well as a certified income tax preparation instructor, Certifying Acceptance Agent , and a certified tax preparer on file with the IRS.