It’s that time of year again – tax season, which can be incredibly daunting for those who are self-employed. What do you need to remember to record and write off if you’re an actor or model? Here’s what Backstage has to say.
First and foremost, it is important to get yourself a good accountant – preferably one who not only understands self-employment but the inside workings of the entertainment industry specifically. If this is the first year you’ll be declaring yourself self-employed, know up front how aggressive you want to be with deductions. If you plan to be uber-aggressive, hopefully, you’ve been saving every receipt!
If getting your start has left you in a less-than-favorable financial position, you’ll likely want to try and get as much money back this year as possible, which means maximizing deductions and re-categorizing expenses to best fit your strategy. Keep in mind, the more you write off, the more paperwork there is, which leaves more room for error. It can also mean more money out of your pocket to get the ball rolling. Of course, you’ll want to include only those things for which you have solid documentation.
Gather receipts for any wardrobe items you paid for out-of-pocket, as well as cosmetics, dining expenses and those for creating or updating your marketing materials. Track your miles driving to and from auditions, too. Anything else that is relative to your business as a model or entertainer can be included.
It may prove to be easier to have a separate business bank account which is used solely for depositing and withdrawing money for your entertainment endeavors. This way, everything you need to track will be in one place. Have a business-only credit or debit card to use with the account and put everything not purchased with cash on this card.
Finally, make sure you have everything in order before visiting your accountant. This will ensure the meeting will go more smoothly and your filing will get started in a timely manner so you can be reimbursed for your efforts, if applicable. If you have some questions to ask, jot these down ahead of time. And, remember, tracking expenses doesn’t stop when you reach your CPA’s door. This is a continual process, so don’t forget to keep track for the next time around.
It’s important to understand you’re not the only one who is going this route. Ask others in the industry for advice. And, always stay as organized as much as possible throughout the year, so gathering everything when tax season starts won’t slow you down.