Acting School Monthly Newsletter - Issue #024 - January 18th, 2011
How Can Doing Your Taxes Help Your Career?
Here's the news from Acting School Stop, your one stop on the road to an acting career!
In this issue... Learn to save money at tax season by understanding what acting career expenses can be deducted from your taxes! Read the article below from actor tax expert Michael Franklin to know what to do to save money on your taxes this year and next. We also have some good acting tips this month on how to prepare for auditions, avoid agency scams and even start your own acting company, so read on and see what's new on the site!
How to Save the Money you Spend on Your Acting Career at Tax Time
1) Article of the Month - How to Deduct your Acting Expenses from your Taxes
Written by Michael Franklin
If you're an actor, whether or not you have earned any money from acting, chances are you have actor-related expenses you can deduct from your taxes. Headshots, Acting Classes, Casting showcases, travel to auditions and classes, books, plays and trade journals related to the business, and many others are all valid expenses which your accountant can help you offset against your earnings this year (if you have earned this year) or in future years (if you haven't).
The time and effort expended in preparing to meet your tax preparer is not only time well spent, it is also required by law! But how can this be done as quickly, effortlessly and accurately as possible?
There are several sources of information for actors at tax time. The Screen Actor's Guild may run a VITA program (Voluntary Income Tax Assistance) near you. There may be a local tax preparer near you that specializes in actor tax returns or you may choose to go to a non-specialist accountant who will do your return for you.
Hopefully you have kept each and every receipt related to your business somewhere safe. If you haven't don't fear, there are ways to try and track down your expenses.
If you've written checks to your acting school that will provide clues as to some of your activities. So your checkbook is a good place to start. Your bank/credit card statements can also be very informative as well as your online bank login, which may provide you with links to copies of checks you've written. Bear in mind that each entertainment related expense most likely has an entertainment related travel associated with it.
If you keep records of your auditions hopefully you have a mileage log in your car of each actor-related journey. Actors are required to break down their total mileage (odometer reading at the beginning of each year which serves as the odometer reading for the end of the previous year.), as well as commuting miles, and non-business miles (eg. trips to see Grandma or to the grocery store).
Let's assume you have all your receipts in a shoebox and you have a list of all allowable expenses that your accountant gave you. Now what? Well you can put all the receipts that are related to the same thing together. For instance all receipts related to your acting classes together. (drama classes, singing classes, cold-reading or auditioning classes, commercial classes etc.) So your first task is to put all like receipts together.
Then you must add these up and put a total for each category. Your accountant should have advised you which categories to put together. For instance advertising can cover headshots, cost of photo postcards, zed-cards, photo business cards, etc. It can also cover Xeroxing of your resume, web hosting if you have a website and paying a web designer to add features or photos or show reels to your online presence. If you're on the Player's Guide, that can be considered advertising or marketing of your business.
A fair amount of work goes into getting ready for the tax-preparer, especially if you work with someone who doesn't specialize in actors' taxes.
In addition, some expenses are not 100% deductible. Suppose you have just purchased a blue-ray player in order to watch your favorite films in HD. Because you can watch blue-rays just for fun, you can only deduct part of your new player as a "research expense". Or what if you've just purchased a wig for a role in a play? Once the play has ended, you will still own the wig and you could put it to use for other personal reasons such as a Halloween party, so you cannot deduct the full amount you paid for it as an expense.
The fact is there are many occasions when an expense is not entirely deductible and it can be hard work to go and find the receipt in question, take a percentage of the deduction and subtract it from the total for that category.
What if there were a simpler way? What if you could get your receipts and enter them into a specially created actor spreadsheet template that already had the actor categories listed to serve as reminders of the type of expenses that are allowable? Now what if in addition you could be spared having to sort all of your like-receipts together? What if you could close your eyes, put your hand into your shoebox and pull out the first receipt that comes into your hand and enter it into the spreadsheet and that the program somehow magically put like with like and did all the adding up for you? How much time would that save?
I have good news. There is! Excel-lentsolutions.com is a site run by actors for actors. We have created a selection of tools with the aid of tax-preparers who specialize in the entertainment industry to help you record various aspects of your acting business so that you can keep track of them. One of our most popular products, The Small Business Expense Spreadsheet, enables actors to change the percentage of deduction on any item and the total is instantly adjusted to a valid deduction. Because they are created in Microsoft Excel, the data entry is quick, it is user-friendly even to the least computer-savvy actor and affordable to all. But even better still, you can use the program over and over again each tax year to make sure you don't miss any deductions!
For more information visit our Actor page: http://www.excel-lentsolutions.com/actors.php
Michael is an Actor, Producer and Director and a founder of www.excel-lentsolutions.com since their inception in 2006.
How to Start an Acting Company
2) What's new on Acting-School-Stop.com
Want to create acting company but don't know where to start? Check the answer to this question.
Atlanta Acting Schools
Check out our new page with listings of Atlanta acting schools. As usual, listings include information on acting training, tuition fees and how to apply.
Prepare for the Interview Part of your Auditions
Wondering what questions you'll get when you audition? Read about all the different things you may be asked so you can fully prepare for you casting calls.
What does "objective" and "characterization" mean? Read the answer to this question if you wonder about these acting terms you hear constantly in acting class and auditions.
How to Find the Right Agent
A look at what to look out for to stay clear from scams and pick the right acting agency for you.
""If the path be beautiful, let us not ask where it leads." Anatole France
3) A word of inspiration
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Good luck with your acting career!
Acting School Stop.com