[NEohioPAL] Performing artist deductions

[Charlie G]

Fellow Students/Performers,

In the spirit of the new year and tax season I type this email.  By night we
all perform, take classes, etc. but by day we have our day jobs.  I work at
a public accounting firm specializing in small business and individual
taxation/business consulting.  Instead of working for the man the rest of my
life, I've decided to prepare tax returns this tax year.  I understood the
need for this E-mail while talking to a fellow performer last week.  Someone
had given him some very bad advice pertaining to taxes and that bad advice
probably cost him a few hundred dollars.  Depending upon your situation you
may be able to take advantage of classes, workshops, meals, headshots,
websites, etc. and deduct them on your tax return, thereby decreasing your
tax liability.

Here are a few scenarios that may pertain to you:
   1.You are going to receive a 1099 during the year and that means that you
are responsible for more tax than if you were to receive a w-2 from the same
company.  Have you budgeted for this tax?  Do you know if you need to send
quarterly payments?
   2.You received cash for work you did on the side and think that you
shouldn't report this.  The IRS says that you have to report any income
received, but it would be very difficult for the IRS to prove that you
received cash, although they could do it.  You may be able to lower your
taxable income by reporting the cash.  Sounds counter intuitive, but it's
true.
   3.The IRS may try to classify your activities as a hobby and not a
business venture, thereby eliminating a loss deduction from your ordinary
income.  Do you know the hobby loss rules?

Check out this link for free info http://www.squidoo.com/Taxrefundme

As a fellow performer, I understand the lifestyle and would be glad to help
out in any way I can.  Even if you are not a performer I would be glad to
talk to you about your tax situation.  Lastly, April 15th will soon be upon
us.  If you are not able to file by the deadline, you will still need to pay
off any tax liability to avoid a late payment penalty, but you can apply for
a six month extension with form 4868 to avoid a late filing penalty.  If you
have not filed a tax return within the past three years and you were due a
refund, then the IRS will take your refund and it will no longer be
available--ridiculous I know!  That is enough tax talk for now.

Cheers,
Charlie
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