It’s Crunch Time! (Part 2 of 3) 

 

CMN’s 2017 Tax Filing Handbook Overview:

1-3. Get Set Up for a Painless Tax Filing & the Essential Forms and Documents to have 

2-3. Expenses Musicians Should Keep Track of for Maximum Deductions

3-3. Tips and Tricks on How to Get Started NOW… and Sailing Smoothly Next Year


 

Deductible Expenses

This is the second installment of the 3-part series entitled, “It’s Crunch Time!”  If you haven’t already read the first installment, check it out here BEFORE you continue.

If you’ve read the first installment, you’ve probably surmised that I advocate being organized. Hopefully, you have kept receipts for business-related expenses in one place. If not, I will walk you through the receipts and documentation to locate so that you can begin filing… 

 

The Variety of Deductable Expenses

Many banks offer money reports online of income and expenses, separated into categories. If you don’t have all receipts, this is an alternative way to determine your business expenses.

Double check though, because sometimes the bank reports list purchases in the wrong category.

Even if you’ve kept up with receipts, the money reports offer a great way to ensure you’ve listed every possible deductible expense.

 

Examples of deductible expenses for musicians include, but are not limit to the following 4 categories  ↓

 

I: Instrument, equipment, & software expenses

  • Instruments
  • Instrumental insurance – if you don’t already have instrument insurance, look into it ASAP and also stay tuned for a future post dedicated to this VERY important topic! 
  • Instrumental repairs
  • Equipment, storage, and/or office rental
  • A/V equipment –
    • like microphones, monitors, speakers, recording equipment… 
  • Other equipment/gear & accessories –
    • like amps, pedals, straps, carrying cases… 
  • Software –
  • Computers 
  • … and so on.

 

II: Transportation expenses – use the following info to help determine your deductions for mileage and travel

  • Mileage
    • Keeping a spreadsheet on a cloud-based software such as Google Sheets (very similar to Microsoft Excel) is an easy, convenient way to have an up-to-date record log of your mileage driven all year long.
    • Determining your mileage deduction is so much easier when you don’t have to guestimate your miles driven.
  • Car repairs
  • Travel expenses –
    • transportation → plane, car, parking, bus, taxi, train, Uber/Lyft, horse & carriage(OK, I’m kidding – unless you can actually prove how paying to use an animal as transportation was a necessary business expense!)

 

III: Administrative & promotional expenses – expenses that you incur in order to make your business run smoothly

  • Printing and photocopies
  • Last year’s tax filing costs
  • Business gifts  ($25 max, per person)
  • Clerical & bookkeeping costs
  • Cellular calls – ONLY the business use percentage
  • Some charitable contributions
  • Consumable supplies – strings, rosin, blotting paper, cork grease… 
  • Magazine subscriptions
  • Educational costs – tuition and student loan interest paid (see Part 1 of this series for more details)
  • Promotional – business cards, website costs, CD/recording duplication, photos, bios… 
  • Sheet music, music business books, record company directories, venue directories, “How-To” books and manuals
  • Office supplies – paper, envelopes, photocopies, stamps… 
  • Rent for your teaching/practice space
  • Professional fees – hiring an attorney, manager, agent, accountant… 

 

IV: Miscellaneous

  • Lessons & instruction you received
  • Out of town (OOT) expenses – meals (not including alcoholic beverages), lodging… 
  • Professional organization membership fees – association and union dues
  • Repair tools
  • Dry cleaning for concert uniforms and formal wear
  • Losses by theft – Getting the RIGHT credit cards will also help with damage, theft, and/or loss. Stay tuned for a future post on the best cards for musicians to carry so that you can maximize the safety of your purchases AND earn points for a comfortable audition travel! 

 


WORKSHEET for download (Just click and save)! 

 

 

 

Final Part Coming Soon… 

 


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