Thread: Tax Write-Offs

Can anyone in the US tell me what is necessary to do in order to be technically/legally self-imployed as a belly dancer or teacher, with the end goal being the ability to write off things such as CDs, costumes, etc.?
Thanks!

The best advice I can give is to find a good accountant--one that can answer all your questions, advise you on write-offs, and help make sure everything is in order for the IRS. Yes, you can do it without a CPA, but IMO a good one is worth their weight in tax savings (and peace of mind).

If you dance under a stage name, you'll need to register a DBA with your county. That's about all you need to do legally. The rest is just good record keeping. You'll need to keep track of all your income and report that to the IRS, as well as your expenses (keep those receipts!!). Don't forget to track your mileage as well. Then at the end of the year, you report all this on a Schedule C.

Again, a good accountant can help you get started. If you can find one that is used to working with entertainers, all the better!

Hi!

One of these days I want to make a flyer for you all. Too much to write and it varies per person. If you have any specifics, email me or call me :)

what's a DBA?

Originally Posted by Yonca_Yildiz

what's a DBA?

It stands for Doing Business As. More info here: What is DBA?

Semi-related. Do you all have business licenses? I don't thin I'm making enough as a part-time bd to register one. Do you need one to file taxes?

My accountant told me that as long as I am reporting income as a bellydancer, no matter how little, I am considered a sole proprietor and any related expenses are tax deductible. That's what he said, but I'm no expert so please speak to your own tax professional!

Originally Posted by maliam

Semi-related. Do you all have business licenses? I don't thin I'm making enough as a part-time bd to register one. Do you need one to file taxes?

Business license requirements vary from city to city and county to county...you'll need to check with your city/county to see what the requirements are.

I am licensed in my city (which is also a county). I pay an annual licensing fee, but that is separate from my taxes. If I were operating a business in a different municipality, I wouldn't have to be licensed in my own municipality (because I wouldn't be operating the business there), but I would still have to pay taxes on the income to my own municipality (because I live there). ARGH, could it be any more confusing?!

It definitely helps to consult with your local government, and a small business assistance center, if you have one in your town.

yup get a good accountant, they are well worth their fee..mine just helped me write off my new boobs :) modeling/advertising lol

I have been dying to know this. I have so many costumes I could write off....but what if you don't have receipts? I have all of the ones I've bought online, but there are a few I've bought second hand from friends...do I go ask them for receipts now?

Originally Posted by Sonja2

I have been dying to know this. I have so many costumes I could write off....but what if you don't have receipts? I have all of the ones I've bought online, but there are a few I've bought second hand from friends...do I go ask them for receipts now?

I don't actually give my receipts to my tax guy, as I track everything in a spreadsheet. The receipts are for if I ever got audited, and had to prove that the info from my spreadsheet (plugged into the tax form) came from a legitimate transaction. I'm no expert, but I would think that if you paid your friends by check, you would be okay if you could hunt down a copy of the canceled check or a bank statement showing the check was cashed by the person you wrote it to.

Cash is a little more sticky, because without a receipt there's no paper trail. I write my own receipts for cash transactions, if the person I'm buying from doesn't give me one.

Used to be that writing your own "receipts" (or notes) about cash/receiptless transactions was enough. I'm not so sure now, as the IRS has gotten stricter. I still do it, but again, it's best to check with your accountant on what satisfies the Tax Man these days.

Laura's right--you don't actually give your receipts to the accountant. It's all about record keeping. I use Quicken (which is a Godsend!!) and track EVERYTHING! Then I just print out reports at the end of the year and give the totals to my accountant.

Originally Posted by aazura

Laura's right--you don't actually give your receipts to the accountant. It's all about record keeping. I use Quicken (which is a Godsend!!) and track EVERYTHING! Then I just print out reports at the end of the year and give the totals to my accountant.

My tax guy would put everything together from my receipts, but he'd also bill me for every minute he spent doing it. He actually was surprised when I came in with my spreadsheet numbers - he says a lot of his sole proprietor clients just hand him a box (or boxes!) of unfiled receipts and invoices. The difference is, he's able to complete my tax return in an hour, whereas it can take several hours or even days to do theirs.

I second the recommendation to see an accountant.

Rules may vary, but here (Massachusetts) if you are operating a business, you are automatically a sole proprietorship. You only need to register your DBA if you are doing business under a fictitious name. I didn't get mine until I started teaching and half the checks were written out to Nadira Jamal.


Depending on your situation, dancing may count as a paying hobby. In that case, you could deduct your expenses to reduce the taxable portion of the income you earned by dancing.

Business or Hobby? Answer Has Tax Implications

Originally Posted by laura 2

I don't actually give my receipts to my tax guy, as I track everything in a spreadsheet. The receipts are for if I ever got audited, and had to prove that the info from my spreadsheet (plugged into the tax form) came from a legitimate transaction. I'm no expert, but I would think that if you paid your friends by check, you would be okay if you could hunt down a copy of the canceled check or a bank statement showing the check was cashed by the person you wrote it to.

Cash is a little more sticky, because without a receipt there's no paper trail. I write my own receipts for cash transactions, if the person I'm buying from doesn't give me one.

Thanks for this, Galatea! To piggyback w/a related question: What if we purchase costumes or bd-related items via paypal or using a credit card? Couldn't online receipts printed out and/or monthly statements count? Oh, yes, you bet I'll ask my accountant at tax time :))

i live in the county to avoid city fees.
i write all off.
web master
server
make up
skin/hair care
costumes
expenses teaching out of town
uhaul for ren faire
a % of my home used for work
home office, all supplies
postage, shipping suppplies

oh yeah, banking on line makes it all easy to run totals at years end.
and have 1 credit card for work stuff only

Originally Posted by Lesgemini_Zafirah

Thanks for this, Galatea! To piggyback w/a related question: What if we purchase costumes or bd-related items via paypal or using a credit card? Couldn't online receipts printed out and/or monthly statements count? Oh, yes, you bet I'll ask my accountant at tax time :))

I pay for a lot of stuff online with Paypal and Credit Cards, and that's exactly what I do. For Paypal, I just print the transaction details where it shows who the money's been sent to, for how much and on what date.

Yes, any documentation of expenses count, including cleared checks :)

Ladies, go to IRS.gov forms and publications and download a schedule C. Most of you will use this. Read the line and this should save you time when giving stuff to us at the end of the year for expense classification purposes :)

It's really important with beauty products, services and costumes that it be purely business related and cannot be used for benefit outside work. While you may be able to get away with it, an auditor might not approve.

Strippers used to be able to write off implants, but now have to get augmented large enough to be not an "asset" in your every day life, and obviously a "stage prop". A girl won in court to get hers as a tax write off, but she went up to a 56FF or something.

Here's more info on costuming from http://www.entrepreneur.com/money/ta...le171204.html:

Tax Write-Off: Work-Related Uniforms or Costumes
The dos and don'ts of this tax write-off are fairly simple: If the costume or uniform is something you could wear outside your job, you shouldn't write it off. If, however, it's obvious you can only wear it for the duties of your specific job, then it qualifies as a write-off. So a new suit wouldn't qualify since you can wear it other places outside of your work environment. What about a clown suit, you say? That's a different matter.

* Expert Opinion: LeValley urges taxpayers to go for the write-off if it's a legit expense. "If the expense is real, take it," she says. "It may be strange, it may be large, but whatever it is, if it's real, be prepared to substantiate it but don't be afraid to do it."
* How to Do It Right: A perfect example of some rather unusual clothing you can write-off involves a Las Vegas showgirl who was trying to write off the tight, sequined costumes she purchased for her performances. LeValley says the showgirl was told she couldn't deduct the costumes since they were clothing and she could wear them elsewhere. To prove that theory wrong, the woman showed up at her audit in one of her costumes and said, “Where in the world do you think I could wear this? I can’t even sit down!” Needless to say, she won her case.

Yes. Costumes should be listed and depreciated if they have a useful life of more than a year. However if you horse trade 24/7 then you can just record the expense AND the sale during the year.

Originally Posted by SamiraShuruk

It's really important with beauty products, services and costumes that it be purely business related and cannot be used for benefit outside work. While you may be able to get away with it, an auditor might not approve.

Strippers used to be able to write off implants, but now have to get augmented large enough to be not an "asset" in your every day life, and obviously a "stage prop". A girl won in court to get hers as a tax write off, but she went up to a 56FF or something.

Here's more info on costuming from http://www.entrepreneur.com/money/ta...le171204.html:

Tax Write-Off: Work-Related Uniforms or Costumes
The dos and don'ts of this tax write-off are fairly simple: If the costume or uniform is something you could wear outside your job, you shouldn't write it off. If, however, it's obvious you can only wear it for the duties of your specific job, then it qualifies as a write-off. So a new suit wouldn't qualify since you can wear it other places outside of your work environment. What about a clown suit, you say? That's a different matter.

* Expert Opinion: LeValley urges taxpayers to go for the write-off if it's a legit expense. "If the expense is real, take it," she says. "It may be strange, it may be large, but whatever it is, if it's real, be prepared to substantiate it but don't be afraid to do it."
* How to Do It Right: A perfect example of some rather unusual clothing you can write-off involves a Las Vegas showgirl who was trying to write off the tight, sequined costumes she purchased for her performances. LeValley says the showgirl was told she couldn't deduct the costumes since they were clothing and she could wear them elsewhere. To prove that theory wrong, the woman showed up at her audit in one of her costumes and said, “Where in the world do you think I could wear this? I can’t even sit down!” Needless to say, she won her case.

What about make-up? It's a necessary part of my job and I'm EXPECTED to wear it without question, but I could potentially use it outside of performance. And what about pedicures/manicures? I normally wouldn't get them, but for performance I do and for a prior dance troupe it was required.

It's sticky there.

My suggestion is to buy makeup and keep it seperate. However you can say I use this for 50% for biz and 50% personal.

Another thing to condsider is how you earn your money. As predominantely a performer, you would have more leeway. However if you perform once a year and teach the rest you ethically should consider if that mani/pedi each week is a biz exp...

Originally Posted by amity

It's sticky there.

My suggestion is to buy makeup and keep it seperate. However you can say I use this for 50% for biz and 50% personal.

Another thing to condsider is how you earn your money. As predominantely a performer, you would have more leeway. However if you perform once a year and teach the rest you ethically should consider if that mani/pedi each week is a biz exp...

I like the 50/50 idea and I suppose things that are specific for dance (like my glitter eyeliner) could be 100%.

I don't get pedis every week and I do earn mainly through performance. So maybe that can be a 50/50 as well? Although lately I've been doing them at home to save $ with this crappy economy ,m:: But that of course requires purchasing a kit, nail polish, top coat, etc.

This whole tax-write-off thing is a completely new idea for me! So fun !

:) !

thanks so much all for this invaluable advice!

Originally Posted by amity

It's sticky there.

My suggestion is to buy makeup and keep it seperate. However you can say I use this for 50% for biz and 50% personal.

Another thing to condsider is how you earn your money. As predominantely a performer, you would have more leeway. However if you perform once a year and teach the rest you ethically should consider if that mani/pedi each week is a biz exp...

I have separate stage and street makeup, but where it really got weird for my tax guy was stuff like eyebrow waxes and haircuts. It's not like you can only use your neat eyebrows for dance and go back to being hairy the rest of the time. He has me write off 40% of those expenses to be on the safe side.

I would love to write off my monthly massage therapy, because I know it's a dance related expense. I didn't need it until I started teaching over 5 classes a week, and I think I'd have to give up half of my classes if I didn't get it every month. But my tax guy says I can't write it off unless my regular doctor writes a note that it's a medical necessity.

Do you write off mileage to/from dance-related work and dance-related cell phone use? When I worked as a merchandiser we were paid for mileage and given a stipend for cell phones, so I'm wondering if that could be considered a bd-related expense?

Yes!