Tax write-offs

Chuck Jackson · Post by **Chuck Jackson** » Sun Jan 15, 2006 8:04 pm

You can take a one time depreciation on the instrument or spread it out over a certain number of years. You can also write off the salestax you paid on it, the gas you used getting there to get it, the meals you ate, and the mileage, except if you take the mileage you can't take the gas. Everything you do even remotely related to music is a write-off, but let me let you in on a little secret, if you are a student, you probably won't beat the standard deduction. You have to make enough to either file a long form or have enough write-offs. Look hard at the standard deduction. Good Luck, and remember, don't f*&k with the IRS, they fight dirty.

Chuck"who pays alot for his Tax Guy and never regrets a single penny of it when he sees his return"Jackson

windshieldbug · Post by **windshieldbug** » Sun Jan 15, 2006 11:34 pm

Tubas ain't cheap, but I agree with Chuck, it pays to have someone who does this for a living check your situation out, because so much depends on so much. I never regreted one dollar I paid to my tax guy, and I can only say it was worth it. Some things you just don't dick with. One is the downbeat. Another is the IRS...

dtemp · Post by **dtemp** » Mon Jan 16, 2006 12:42 pm

Scott Roeder (who posts on TubeNet) did a great presentation at ITEC this past summer about being a freelance musician. He had a lot of really great ideas including tax stuff. Send him a PM?

ThomasDodd · Post by **ThomasDodd** » Tue Jan 17, 2006 11:59 am

Chuck Jackson wrote:Chuck"who pays alot for his Tax Guy and never regrets a single penny of it when he sees his return"Jackson

That is truely sad. I regret every penny I spend on tax return preperation. I particurally regret having to spend anything.

Best case, abolish all income taxes and the IRS.

Second best, the Forbes plan:

tubalamb · Post by **tubalamb** » Tue Jan 17, 2006 1:26 pm

Recently, I saw a Commercial for Tax prep software that showed a musician writing off his mics and other equipment. Being that I purchased a Tuba in December, can I do the same??

I can shed a little light on this as I volunteer to help out the military during tax season through Volunteer Income Tax Assistance.

You most definitely can write off all your music expenses. With the larger expenses, you can either you can write if off as a one time thing or spread it out over a few years. It also carries a little more weight to write it off as an expense for self-employment if you happen to have a bit of income from untaxed sources (freelance gigs, teaching, etc.)

By using it as a self-employment expense you can get around the standard deduction that Chuck mentioned earlier, and even claim a loss for your self-employment if necessary. But be warned that if you claim a self-employment loss 3 out of any 5 years, the IRS changes that "self-employment" designation to a "hobby" designation . . .and then the tax rules on the depreciation change.

Also, its worth mentioning that if you write off an instrument for buisiness purposes and then sell it later on, the IRS taxes the "profit" that you get from the sale. Profit = Price you Sold it for minus the Cost Basis (Cost Basis = Price you paid minus the amount depriciated).

If you have any questions, I'll be happy to answer what I know. Also, FYI, I'm not a professional tax specialist . . . I just volunteer to help out my colleagues on base. Most of the information I have is stuff I've dealt with the past few years working with the musicians in my band.

Also, at a certain point taxes can get completely mind boggling and over complex (due to the most complex tax code in the world). There is something to be said about paying a good tax guy to simplify things.

Cheers,
Steve Lamb
Tuba, U.S. Coast Guard Band

ThomasDodd · Post by **ThomasDodd** » Tue Jan 17, 2006 2:13 pm

LV wrote:First, flat tax sounds good to me!

Not so much "good" as "better".

One great thing would be removing this problem

"don't F*&% with the IRS".

The power the IRS has is ridiculous. People complain about the FBI and ATF, but there are meak and mild in comparison. The fear the IRS inspires in many is greater than most any out there. I'd rather go through a nuclear attack that and IRS audit.

The government is too big and costs too much. To support all the programs we've given away our most basic liberties. Just the compliance costs alone, should make the system unconstitutional at some level (equal protection and due process come to mind).

windshieldbug · Post by **windshieldbug** » Tue Jan 17, 2006 2:26 pm

ThomasDodd wrote:The government is too big and costs too much.

Well, you could live in England, or ...

pulseczar · Post by **pulseczar** » Thu May 03, 2007 10:53 am

Here's my dilemma:

I'm still paying off my CC tuba, and now my teacher is encouraging me to purchase a bass tuba. Working 60 hours a week during the summer, I can scrounge up roughly 1.4k a month, which is way less than I can afford.

I heard a rumor somewhere that since I'm a dependent going to school as a music major, there was a way of purchasing a tuba and writing it off.

Any tax professionals care to shed some light on this?

The Big Ben · Post by **The Big Ben** » Thu May 03, 2007 11:17 am

tubalamb wrote: Also, its worth mentioning that if you write off an instrument for buisiness purposes and then sell it later on, the IRS taxes the "profit" that you get from the sale. Profit = Price you Sold it for minus the Cost Basis (Cost Basis = Price you paid minus the amount depriciated).

Yes, if you buy a Yorkbrunner, depreciate it and write it off then want to sell it, I will gurrantee that I'll give you a price low enough to keep the IRS off your back...

lgb&dtuba · Post by **lgb&dtuba** » Thu May 03, 2007 11:24 am

Maybe it's implicit in all these replies, but you have to actually be a professional musician to write off your expenses. And I mean in terms of the law, not your own opinion of your skills. If the IRS challenges you and it turns out you're a hobbiest (under the law), then you'll be paying them back big time.

If you're a student I don't think you'll be able to claim anything, no matter how much you intend to become a professional one day.

If you're a part time pro, then you may or may not be able to claim anything. Especially if you never make a profit at it. A business set up specifically to lose money won't cut it. I don't remember the details, someone else can look it up if they're interested, but if you don't make a profit every so many years the IRS will disallow it and say it's a hobby. A business set up to avoid taxes and not for profit isn't allowed. (Unless you can qualify for a 501(c)(3) or such.)

The best advice so far is, don't mess with the IRS.

Technically, I can claim a number of things since the band I'm in is a 501(c)(3), but I don't because it's just plain not worth the hassle.