VO-BB - 19 YEARS OLD!

[tackerman]

Does anyone have a link to online info about taxes and other issues you need to consider when running a small biz?

[Bruce]

I'm not an accountant, but I've been deducting performing expenses for a long time, so my advice is given with that caveat. The only time this matters is IF the IRS audits you, and this may never happen. ("You feelin' lucky, punk?" sometimes comes to mind.)

My understanding is you can run a losing business on the side for a long time, so long as you show you are seriously attempting to make a go of that business...you market and promote yourself, you eventually gain some income from it...and are not just using the business to deduct personal expenses.

Everything you spend that is clearly meant for the VO business is deductible, such as website expenses, Voice123 membership, separate business phone line, blank CD's, equipment, etc. High ticket items (I believe $500+) should be put on a depreciation schedule and deducted in increments over several year OR, you probably can often deduct the whole thing all in the same year, but you still have to fill out the depreciatin forms (aargh)...you see, this is where you need an accountant for sure.

Think creatively? I hear there are actors who've been in a few movies and deduct all of their movie tickets and rentals because they are studying their craft.

When you have an expense that is used both for home and work, such as ISP fees, then you have to split it. That percentage is up to you to prove, but as a full time VOT I have no problem going 50/50 on those.

Home office expenses are another matter. If you have a room or area of the house that is "exclusively" for this business, then whatever the percentage of that square footage of your home is (say 16%), is the percentage of major household expenses that you can deduct. 16% of rent if you're renting, utilities, hazard insurance, property taxes if you own your home, and, here's where you really need an accountant, you can depreciate that portion of your house, just as if you bought an office building. I'd only do this once you're committed to being in a home business and committed to always owning a home because it's a pain to start and stop the home depreciation thing.

There's better, more accurate advice out there, but this should get you started.

B
_________________
VO-BB Member #31 Enlisted June, 2005

I'm not a Zoo, but over the years I've played one on radio/TV. .

[Deirdre]

Get a good accountant who can handle dealing with a million income sources.
_________________
DBCooperVO.com

[Travis]

Hi Tom.

I've been doing my own taxes for quite a while - Turbotax helps a lot. Most of the issues you need to deal with are actually handled by the program, and explained in the materials they provide.

Remember, tax law has become so complicted, nobody understands it - including accountants, lawyers, and IRS personnel. However there are a good number of general rules to follow. You can get most of them from the guides you can buy at any bookstore - including J.K. Lasser's "Your Income Tax".

Generaly, you have three years to make a profit, otherwise your business, is viewed as a "hobby" by the IRS. If you're in business for yourself, there's a GOOD CHANCE you will be audited sometime. If you're in Showbiz, there's a GOOD CHANCE you will be audited sometime.

A few years back, every pro voice-artist and actor in Orange County, CA was audited - it seems someone found out that many were deducting their mileage to Los Angeles - However, it turns out that, your first and last drives during the day are considered your "commute", which is not deductible. I knew that, of course, and I didn't have a problem because my studio was located several miles from my residence, and since my first and last drive was always to my studio, any additional mileage (which was considerable) was deductible. Because I do my own taxes, I knew the rules, and the IRS auditors and got along just fine. Several friends, (who had accountants doing their taxes) didn't do so well, and ended up with very large penalties, interest, etc.

If you do have an accountant doing your taxes, be sure to learn something about taxes yourself. If you're in the V.O. business you ARE in business, so you will need to file schedule C (Profit or Loss from a Business or Profession ) to write off any of your expenses. Learn at least a little bit about what your are doing, in that regard.

Disclaimer: I'm not any kind of tax expert, just a VO guy who's had to deal with this for a long time.
_________________
Travis
www.VOTalent.com

[Deirdre]

Move to Maine.
Nobody here gets audited.

Everything is mileage for me because my studio is in my home--unless it's to go to CBS which is a wage-earning job. First-and-last-drive-of-the-day is news to me! Nothing like that has ever counted for my situation---if it's a one-time job or an audition that I drive to, all the mileage counts.
_________________
DBCooperVO.com