Growth Group | Accounting for Musicians

3 Tax Deductions You Won’t Get This Year

“I’m writing everything off.” Well, no. You aren’t. Here are some tax myths and frequently requested deductions that just aren’t happening, at least not this year. Every year between January and April when we are preparing tax returns there are interesting deductions that our music creators tell us they are entitled to receive. Here are a few of our favorite creative, illegitimate, and fascinating tax deductions, that won’t be on your tax return:

Music Tax Myths

1. Performing for nonprofit free is a tax deduction.

Giving back to the causes you believe in by donating your music services, such as teaching a music class or performing at a gala, isn’t a tax deduction. The IRS does not allow you to deduct the value of your time or services as a charitable contribution. Instead, you’re considered an unpaid volunteer to the charity.

 Volunteering your music services to a nonprofit does allow you to take a deduction of 14 cents per mile. So, that’s a plus if you’re tracking your mileage (hint: use this travel tracker worksheet). Also, if you decide to donate those CD’s collecting dust in your closet you can deduct those!


2. I can write-off all of the costs of recording music.

Nope, sorry. You can only deduct half of your recording costs the year you record. You can take the rest of the recording deductions equally over the next two years (25% each year). While you eventually do write-off all of your album recording costs, the timing of when makes the difference. Here’s which recording costs are only 50% deductible the first year.


3. My new suit and tie for performing on stage is deductible.


Those new stage wears are not a tax write-off. This is the most common tax myth we see. Clothing you wear on stage, for on-air interviews, or for music videos still isn’t tax deductible because they can be worn outside of music work (such as a date, wedding, church, or anywhere else for that matter).

The only exception to this is for clothing such as firefighter gear which can not be worn outside of a flaming building for numerous reasons. Even though your fly new suit isn’t a tax deduction there are hundreds of legitimate music tax deductions you can take.

You guys have some good ideas, but be sure to talk to an accountant if you plan on taking deductions on your return. A tax pro can make sure you’re calculating everything properly and that the deductions actually exist, like the iPhone tax deduction.

Were you surprised by any of these things you can’t write-off? What other tax deductions have you tried taking that your accountant questioned?