With tax division now absolutely aloft us, artists may be activity afflicted with paperwork surrounding the backbreaking assignment of filing. Actuality we attending at a basal account of the best accepted tax forms for musicians, as able-bodied as back they’ll be needed.
Guest column by Jamie Davis-Ponce of Soundfly’s Flypaper
Well, it’s tax season. Hopefully by now, you’ll accept accustomed a cardinal of forms you’ll be accepted to use back filing your taxes afore the April 15 borderline [note: In 2018, the borderline is April 17th]. But in case you anticipate that the titles of the forms axle up on your board complete added like a buzz book than a way to get a refund, here are some basal explanations of the best accepted tax forms for musicians and back you’ll charge them.
In general, the tax forms frequently encountered by musicians abatement into three asperous categories:
Taxes can get complicated fast, especially for musicians accepting royaltiesand/or freelancing, so consistently accomplish abiding to argue a tax able about your specific tax situation.
Apprentice added on Soundfly: Find out which royalties and licensing opportunities are accessible to you and how to aggregate them in our chargeless course, How to Get All the Royalties You Never Knew Existed.
W9 or W8-BEN — accepting paid for gigs as a freelancer
If you do freelance* work, the person/business advantageous you may ask you to ample out a W9 or W8-BEN (W8-BEN is about acclimated by individuals who are not US citizens or US residents). Businesses are appropriate to accumulate clue of and address who they pay for casework and how abundant they pay them. As a freelancer, bushing out this anatomy about agency you’ll accept a Anatomy 1099 from the business if they paid you at atomic $600 over the advance of the year. The Anatomy 1099 should be beatific to you ancient in the three months above-mentioned to the tax filing borderline in April.
W4 — accepting paid as an employee
If you’re an employee* of a business, you’ll ample out a W4 and accord it to your employer back you activate to assignment for them. This anatomy allows you to specify how abundant the business should abstain from your paycheck for taxes, and helps the business to address how abundant they paid to you. Bushing out this anatomy generates a W2, which you will accept from your employer anniversary year ancient in the three months above-mentioned to the tax filing borderline in April.
*Not abiding if you’re a contributor (a.k.a., an absolute contractor) or an employee? Check out the IRS website to accept the differences.
1099-MISC — From gigs area you becoming $600 and/or royalties of $10
As a writer, assuming artist, and/or freelancer, you may accept abounding 1099 forms. The 1099 capacity how abundant money you becoming for assuming casework (including genitalia and labor) or royalties, and from whom you becoming the money. These forms are beatific to you by the businesses you’ve formed for, and you’ll charge the admonition from these 1099 forms back accomplishing your taxes.*
W2 — From your employer for part-time or full-time work
These forms detail how abundant money you becoming as an agent and how abundant you’ve already paid in taxes (as a aftereffect of the denial choices you fabricated on your W4 anatomy submitted to your employer). These forms are beatific to you by your employer, and you’ll charge the admonition from these forms back accomplishing your taxes.*
*If you haven’t accustomed these forms by backward February, you should alarm the businesses you accept formed for and let them apperceive that you accept not accustomed the forms, back you charge the admonition on these forms to complete your taxes. Accumulate in apperception that if you’re absolutely a freelancer, you acceptable will not accept these forms.
People filing taxes use one of the forms in the 1040 family, but depending on the types of assets you receive and which deductions and tax credits you claim, you may additionally charge to abide some added forms. Actuality is some basal admonition on 1040 forms, and some of the accepted added forms acclimated by musicians.
A 1040 anatomy is the primary anatomy bodies use to acknowledge how abundant they becoming and how abundant they owe in taxes. There are three versions of the anatomy to accept from, and anniversary of these options requires you to access all of your income. Your assets is anything you earned, including salaries, money from gigs, absorption from your coffer accounts, accumulation from investments, royalties, etc.
Which is the 1040 anatomy for you?
Additional forms you may charge to abide with your 1040
If you’re self-employed or the affiliate of a affiliation (both accepted occurrences for musicians), again you may charge to abide added forms with your 1040 anatomy to accord the IRS added capacity about your assets and business expenses, and to accomplish abiding you are advantageous into the Social Security and Medicare systems.
Schedule C or Schedule C-EZ — For the self-employed
Use this anatomy to acknowledge your assets and costs as a self-employed musician. Accomplish abiding to accommodate assets listed on the 1099 forms you receive, but alike if you don’t accept a 1099 for a gig, you’re appropriate to acknowledge all assets becoming that’s accompanying to your business, including royalties. To apprentice which adaptation of the anatomy to choose, apprehend the IRS article, “Should I Book Schedule C or Schedule C-EZ?”
Schedule E — For your role in a partnership*
Use this anatomy to account your alone accumulation or accident from a partnership. Partnerships charge accept a different aborigine identification cardinal alleged an EIN (similar to a Social Security number), and the affiliation charge book its own taxes. If you ample out a Schedule E, again your affiliation charge additionally accept abounding out a Anatomy 1065 as able-bodied as an alone Schedule K-1 for anniversary partner. Royalties that aren’t accompanying to your primary band of assignment may additionally be recorded application Schedule E (see this for details).
*If you’re a affiliate of a partnership, read this article for the basics on which forms your affiliation will charge to book in accession to the forms anniversary affiliate will book with his or her claimed taxes.
Schedule SE — Acceptable bare if you abounding out Schedule C or Schedule E
This anatomy helps you to pay Social Security and Medicare taxes on any self-employment or affiliation assets you becoming (since you did not accept an employer denial these taxes from your paychecks).
Disclaimer: This commodity is for advisory purposes alone and not for the purpose of accouterment acknowledged advice. You should acquaintance your advocate or tax able to access admonition with account to any accurate affair or problem.
Want to apprentice added about how alive and sales royalties absolutely assignment and how to get the money you deserve? Check out our chargeless advance with Ari Herstand, How to Get All the Royalties You Never Knew Existed, and apprehend up on the differences amid accepting paid as an “artist” against a “songwriter” here.
Jamie Davis-Ponce is a able artist and alum of Northeastern University’s Master of Music Industry Leadership affairs with a absorption in entrepreneurship. She has been a music academician at Ithaca College, and is acutely complex in Boston-area arts and music organizations, accepting formed with ArtsBoston and captivated internships at Handel & Haydn Society and Boston Symphony Orra. Jamie is currently an ambassador in the Able Performance Division at Berklee College of Music. You can appearance added of her autograph on her blog on Music, Business, and Creativity.
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