Contributed by Rob Kaiser-Schlatzlein / As an artist, I used to feel that doing my taxes would always be a complicated burden. But there is no good reason tax season has to be eternally daunting; all I needed was some good practical information and a little up-front learning. In the past, friends have offered a mixed-bag of tax tips, but none seemed grounded in the technical language of the Internal Revenue Code, so they did little to calm my fear of being audited. Since I was always afraid I would miss something, every year I hired a tax preparer. While I still think it is a good idea to retain someone who specializes in freelance/artist taxation, answering some of the larger questions for you500彩票网手机版官网rself is also important.
For example, should I incorporate as an artist? has an (she says you500彩票网手机版官网 probably don’t need to) and answers to a whole host of other questions on her helpful website, to which I often find myself returning. She prepares taxes, too.
Another website with great information is . Come up with a few questions about you500彩票网手机版官网r taxes, write them down, and then spend a few minutes on the blog to see if it provides answers.
Freelancers Union is often useful, though it is not always applicable to artists. One area that I have struggled with is expenses. I was unsure how much I could deduct without triggering an audit. I suggest looking into the , which regulates how many years in a row you500彩票网手机版官网 can take a loss on you500彩票网手机版官网r business expenses.
This past year I developed my own automated spreadsheet to track expenses. It’s especially important to realize that, depending on you500彩票网手机版官网r practice, you500彩票网手机版官网 aren’t likely to use all the categories on the Schedule C form, so it helps to spend a little time in advance to identify the more important categories–those in which you500彩票网手机版官网 incur the most expenses. I don’t advertise, for example, so I never worry about that, but I do track business meals (of which you500彩票网手机版官网 can deduct 50%) when I meet with artists and curators to discuss upcoming shows. Identifying the limitations that the IRS imposes on those categories can reduce a lot of stress as you500彩票网手机版官网 collect receipts and track expenses throughout the year.
Get conversant with Schedule C categories once and you500彩票网手机版官网r anxiety is likely to lift. Attached is , which can be updated throughout the year and be uploaded to . Most of the preprogrammed categories will probably be inapplicable (I only use about five of them), so the record-keeping task should end up being very focused. As an artist you500彩票网手机版官网 probably would, at most, need Advertising, Insurance, Legal and Professional, Rent for Business, Taxes and License, Travel, Meals, and Utilities. If you500彩票网手机版官网 aren’t squeamish about privacy issues, software like Turbotax can scour you500彩票网手机版官网r bank statements and invent a expense list for you500彩票网手机版官网. Expense tracking through is also very helpful, especially for artists who are uncomfortable with spreadsheets. However you500彩票网手机版官网 do it, though, keeping track of expenses pays dividends to you500彩票网手机版官网r art practice beyond merely facilitating tax preparation. In particular, it helps you500彩票网手机版官网 determine whether you500彩票网手机版官网’re charging enough for you500彩票网手机版官网r services and work.
Finally, plenty of reputable accountants are sympathetic to the business challenges that artists face. Make sure you500彩票网手机版官网 choose one of them–an accountant who explains to you500彩票网手机版官网 what he or she is doing and answers you500彩票网手机版官网r questions clearly. Maybe you500彩票网手机版官网’ve already filed you500彩票网手机版官网r taxes this year, and maybe you500彩票网手机版官网 haven’t. Either way, it’s a good idea to assess you500彩票网手机版官网r strategy for gathering you500彩票网手机版官网r tax information now so that you500彩票网手机版官网 can improve the process for next year.
About the author: Artist is fascinated by finance and the stock market. In conjunction with the , Kaiser-Schlatzlein will be giving a presentation titled “Inflation: the Open Secret of Everyday Life” at Two Coats HQ during DUMBO Open Studios. Saturday, May 13, 4pm, 55 Washington Street #321. Stay tuned for details. Contact the author at rkaiser.schatzlein@500彩票网手机版官网gmail.com
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