It covers whether or not:
This page has just been published - and over time this page will be developed. At present it's focused on identifying sources of information for you to read - rather than providing a comprehensive easy read. That's because you need to rely on your own judgement and not mine because I am not a US taxpayer |
On other pages you can find generic information about tax and tax in other countries you may sell to
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This site does NOT provide:
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I have no personal experience of US Taxes.
You should engage/pay a professional for US tax advice IF:
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Whether or not you can claim expenses as business expenses and hence as tax deductions depends on whether or not you are conducting your activities as a hobby or a business
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In short - an activity qualifies as a business if it is carried on with the reasonable expectation of earning a profit.
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The IRS asks questions to determine whether an activity is a business - or a hobby.
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If you do not carry on your business or investment activity to make a profit, you cannot use a loss from the activity to offset other income. |
You are running an art business IF:
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You must always declare your income for tax purposes - BUT you can only claim business expenses against tax if you have a business!
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Although you must claim the full amount of income you earn from your hobby, hobby-related expenses are generally deductible only to the extent of income produced by the activity. Therefore, if you do not generate any income from your hobby, you cannot claim any deductions. |
If your efforts result in a profit in three-out-of-five consecutive years, your activity is presumed not to be a hobby by the IRS. |
The IRS provides a Checklist of questions (a "cheat sheet") - in "Is Your Hobby a For-Profit Endeavor?"
The following factors, although not all inclusive, may help you to determine whether your activity is an activity engaged in for profit or a hobby: |
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Say you have an unincorporated sideline activity that you think of as a business. If your expenses from the activity exceed your revenues, you have a net loss. You may think you can deduct that loss on your personal federal income tax return. Not so fast. The IRS likes to claim that money-losing sidelines are hobbies rather than businesses—because the federal income tax rules for hobbies are not in your favor.
Thanks to an unfavorable change included in the new Tax Cuts and Jobs Act (TCJA), the rules are even worse for 2018-2025.
You can’t deduct hobby-related expenses under the new tax law—but don’t give up hope
A self-employed artist may deduct any expense that is: |
The Tax Cuts and Jobs Act established a brand new deduction that allows owners of pass-through businesses, including artists, to deduct an amount equal to up to 20% of their net income from the business. This is in addition to all their other art business deductions. |
Directly related to art-making activity
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Selling Art
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Office expenses
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no longer listed - I'm waiting to see if a new edition is published
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This is for people living in the USA who are involved in CREATIVE activities and who need do an IRS return.
The important thing here is that the author is somebody who is experienced at helping self-employed businesses prepare for their tax return. She's got a basic model for how to do things which she then tailors specifically to groups of people who have a similar situation / tax issues. |
Series: Annual Taxes
Paperback: 102 pages Publisher: One More Press; 2 edition (January 6, 2016) RECOMMENDED: Rated an average of 4.7 out of 5 stars on Amazon.com by 11 reviewers - there are some very complimentary reviews! BUY THIS BOOK |
Here are links to the IRS pages most relevant to artists
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Stages of Owning a Business
The IRS has disaster loss workbooks for individuals ( Publication 584, Casualty, Disaster, and Theft Loss Workbook) and businesses ( Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook) that can help you compile a room-by-room list of your belongings or business equipment. This will help you recall and prove the market value of items for insurance and casualty loss claims. |
New Tax Guide - for writers, artists, performers and other creative people
(fifth edition) By Peter Jason Riley CPA If you are an American or live in the USA you may well find this book by Peter Jason Riley CPA to be helpful. It's specifically written to help with the tax affairs of creative people. Chapters include:
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Rated an average of 4.1 out of 5 stars by 7 customer review
BUY THIS BOOK |
Taxes & Bookkeeping for Artists - Steven Goldglit from New York Academy of Art on Vimeo.
Steven Goldglit - Managing Partner of Goldlit & Company speaks to students at the New York Academy of Art about taxes, bookkeeping and good habits on accounting for artists.
By Tax Advisers (USA)
By Arts Commentators
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By art business bods
By Lawyers
By Newspapers
By Performing Artists
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Creativity is My Business
A Financial Organizer for Freelance Artists, Musicians, Photographers, Writers and Other Talented Individuals by Kiki Canniff The target audience for this book is the PART-TIME creative person - such as an artist - living in the USA who wants to understand the difference between being a hobby artist (which provides no tax benefits) and being a part-time professional self-employed artist. The book is essentially about how to avoid the hobby label and hence be able to calculate and deduct allowable expenses through setting up basic systems and recording all relevant data. The author indicates she is somebody who has experience in helping creative people become more organised to IRS standards which can pass a tax audit. (There's another Kiki Canniff book below. Buy one or the other but NOT both Check out the contents page for both to see what I mean.) |
Paperback: 102 pages
Publisher: One More Press Date: September 10, 2012 BUY THIS BOOK |
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Copyright: 2015-2021 Katherine Tyrrell | Making A Mark Publications
- all rights reserved If you've got any suggestions for what you'd like to see on this website please send me your suggestion
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PLEASE NOTE:
1) Content and the law change all the time. It's impossible to keep up with it if you're not working on the topic full time. 2) I research topics carefully. However, I am totally unable to warrant that ANY and/or ALL information is
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