It's time to start thinking about -- if not organizing -- your voice-over business affairs for the dreaded deadline: April 15th. Working freelance as a voice-over artist has definite perks and benefits, so it's only fair that it should have its snags and hassles, too. With a little organization, and a couple reminders, getting your ducks in a row can be stress free (-ish!)
First of all, if you are one of the many people who got voice-over training in 2009, you can deduct the entire cost of the program. Getting just one voice-over job is probably not sufficient enough to prove to the IRS that voice-overs is more than just a hobby.
The IRS considers any business that reports a net loss in more than 2 out of 5 years to be a not-for-profit hobby. If your business reports a net profit in at least 3 out of 5 years, then the IRS will view it as a for-profit business. If you started your new business in 2009, the burden of proof lies on you big time!
However, your voice-over business tax account, business cards, and marketing should be sufficient evidence if they grill you about it. If you have your own voice-over business, you are obviously considered "self-employed." Make sure to re-read your 1040, Schedule C, which covers income and expenses related to your self-employment.
Other expenses, such as your website, high-speed internet access, and your home studio expenses can typically be put in Part V for "Other Expenses." Keep track of money spent developing your business so that you can write it off! However, keep in mind that you cannot use your home office expenses to create a loss. You can calculate your home office expenses by using Form 8829.
Other tips? Stay organized throughout the year! If you are scrambling to produce documents for clients, or if you're missing a paper trail, take this as a lesson to be organized with each and every voice-over job you do in 2010. Save everything as a pdf with the name of the client and the date.
Do you have other tips for us this tax season? Please share advice for the rest of us dis-organized folks! Thanks!
By: Catherine Marshall