Conference napalm::guitar

    
      Good topic - every year more and more clubs ask for your
    social security number and 1099's start showing up at your house.
    I know it's a legit way to do things, but you have to be sure
    to let Uncle Sam know you have expenses. If I paid tax on all
    my earnings and didn't claim expenses (depreciation, gas, van)
    I'd say f*ck it , it ain't worth the headache and just stop playing
    out in a band. I know a LOT of musicians feel the same way. 
      We've been doing the biz individually, but we're considering a
    DBA to see what it can do taxwise.
    
					-BoOm-

You can claim:

Strings and other consumables

repairs to gear

you can depreciate any gear you may have bought

you can claim mileage or you can claim gas in some obscure fashion

lodging expenses and if you stay away from home you can claim the meals, if 
you do not stay in a motel/hotel or some accomdation other than your home 
you can claim meals associated with that stay away from home.

memberships: related to the business  ex: MIDI association, NEMA etc.

subscriptions: related to the business ex: musician

clothing only if it's sufficiently unique to substantiate the claim that it's
"stage clothing" ex: spandex, gold sequened jackets etc...but not normal street
clothes...even if you buy it for that purpose ex: pseudo-gangster look for a 
blues band (black shirts white tie etc.) can't be claimed (I know)

you must also claim:

income 
and any profit made selling hardware under depreciation 

dbii

    Do you use Form 2106 (as a qualified performing artist)?
    
    Or, do you use Schedule C (business profit/loss)??
    
    	joe.

    I second that!  Which form?
    
    Mike_with_visions_of_new_toys

I used the schedule C, profit or loss from a business....

dbii

    Isn't there a form devoted to musicians?  I could've sworn there was.
    
    Mike

    
    Of course, it assumes you are claiming your income.  And the IRS frowns
    on "businesses" that lose more money than they make.
    
    I.e. if you are currently not claiming band income, you can't take band
    deductions, therefore you can't get any more deductions than you
    currently have.  And if you deduct an amount equal to your income,
    you'll be just breaking even.
    
    If you are claiming expenses, things like records, tapes, lessons, etc.
    can also be deducted.
    
    							Brian

	Are there any books or other resources that talk about how to
	businessify your music... I was thinking about this back when there
	was an insurance note going over in MUSIC.

	Like, what do I have to do to be completely legit?

	Thanks in Advance
	ccb

    From Pg. 16 in the 1040 instruction book (this is in regards to line
    30):
    
    "Qualified Performing Artists.  If you are a qualified performing
    artist, include in the total on line 30 your performing-arts related
    expenses from line 13 of FORM 2106, Employee Business Expenses.  Write
    the amount and "Form 2106" on the dotted line next to line 30."
    
    Knowing the IRS, you probably have to have 50% of your income come from
    music to take this deduction.  
    
    Mike
    
    

    Read very carefully the requirements for a "qualified performing
    artist".  There are four of them and these are "and" type require-
    ments not "or".  I fit all of them except the income criteria.
    
    I think dbII has the best, most legal, method:  Form C.
    
    	joe.

    Could someone post or mail an example of Joe Musician's Schedule C?
    I'm curious to see how involved this is.
    
    Thanks,
    Mike

    If anyone is interested, I have DECalc grids for the following Federal 
    and state forms:
    
    1040 long form with Schedules A, B, D
    Massachusetts long form
    Massachusetts Part-time resident form
    Arizona long form

    If you're not in a band that plays for profit, is there any legal way
    of deducting GTS purchases? ;-)
    
    How about if you play for a non-profit organization?  I wonder if that
    can be deducted as a charitable contribution?
    
    Mike

    FWIW, I asked -1 in the INVESTING notes conference.  The bottomline is
    that if you bought the instruments, and donated them to the charity,
    then they are tax deductible at fair market value.  If you still own 
    them yourself, they are not.
    
    Mike

    
    What if you get paid for your gigs in cash, is there a place on
    Schedule C to claim income as well as expenses?  I just started gigging
    in 1990, and I made almost no money, but I bought a fair amount of
    equipment.  I'd love to claim the income (a few hundred) and the
    expenses (around $2,000) -- is there any way I can do this?
    
    Thanks,
    
    Justine

    I don't know how, but you can definaely write off your new stuff and
    take a loss for your business.  Beware though.  If you continue to 
    claim this as business, you can only do it for 3 years before you
    show an income.
    
    jc (Call H&R block)

    Income is claimed on the 1040 itself.  It goes under wages, and is not
    separated from your other wages (i.e. from DEC).
    
    However, the IRS looks askance at income vs. expenses when expenses are
    higher.  They give you a few years and if you can't show a profit, they
    consider it a "hobby".  Then they sock you with lotsa penalties.
    
    By the way, be careful about equipment purchases, there are rules about
    depreciation, etc. that will confuse almost anybody.  In fact, if you
    claim a purchase as an expense, if you sell it, you have to claim that
    as income, etc.  It can get hairy. 
    
    							Brian

If you gig the way most musician gig, then there is income with
no witholding and there are expenses and Schedule C is where you
show these things. Not under wages.

Schedule C is there to allow you to claim profit or loss from 
business or profession. If you took in money under a services rendered
arrangement, which is what most bar gigs equate to (even though
they usually never file a 1099 form for the money they pay the band 
and even if they do the IRS has no idea who The Purple Arm Chair Coasters
are), then Schedule C is where that income belongs. You claim expenses 
AGAINST your Schedule C income, and show the resulting P or L. Don't forget
that if you show a profit (HA!) you must calculate a self-employment (what
the hell's it CALLED!?) tax. this is your social security tax that
you normally have only to pay 1/2 of when employed by a company. With
self-employment income you get to pay both halves! 

BTW, if you're band is paid by a check made out to you personally, 
LOOK OUT! You better keep good records that there are other people 
that have to be paid out of it. Otherwise the IRS will think that it's
all yours.

--Ron

	life as a Musician/BOOKKEEPER. 

	Yes, by all means, pay your taxes fairly. You can make good money.
	Keep in mind that most places will get a social security number
	(especially if you play for a government installation - officers
	club etc) and they will report it. Keep good records and claim
	your deductions. I usually owe a few hundred every year, but
	I pull in lots more. Depreciate what you can, and save all of your
	reciepts.

								Jens

    Re:  .15    income tax
    
    I agree with .18 (in deference to .17) with regard to reporting of
    income and expenses --- Schedule C is the place, and Form 4562 is for
    depreciation (Section 17 allows total 1st year write-off), and Schedule
    SE for self-employment tax, but only if you show a profit.  Note .17 is
    correct about recoupment of depreciation.
    
    Feel free to send mail for free advice on specific questions.
    
    \Gary who wishes he knew more about playing and less about taxes  :7(

    Any new updates on this front?  It's been years since the last reply
    here and I know the tax code has changed a bit since then :-).  Any
    new gotchas?  Are folks still filing Sched. C for band stuff?  I'm
    planning on working with my accountant on this next week, but I wanted
    to scope out any new news ahead of time if possible.
    
    	Rick
    

    
    	Just fyi, I'm very pleased with Virginia Graham at
    	(508) 481-7587 in Marlboro, Ma.
    
    	Love that depreciation!