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Tax stuff...am I screwed?

#21
rob_d said:
How do you 1099 if you don't know their SSN's/addresses etc..
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Anyone you pay needs to give you a W9 PRIOR to payment. The law does not say prior, but you loose leverage once you pay them. You need the W9 as backup for the 1099 you issue at the end of the year. The form is accessable thru the IRS site below. Likewise, if you get paid from a bar, club, ect. you should be giving the person hiring you a W9 and they should give you a 1099 at the end of the year. Fairure to do any of this can (and usually will) result in small fines ($50 per occurance I believe). Here is the W9 link.

http://www.irs.gov/pub/irs-pdf/fw9.pdf

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#22
Have you tried calling the IRS and waitng for hours? Yes this works... ask them at a minimum to reduce it to your portion.

They're understanding... ask them to reduce it to your 1/4 of the total ammount and offer to help identify the other folks.

I still can't understand why people complain about the lack of services and then forget they don't pay in their fare share.

Dang... college kids missed that the world wasn't free?
 
#23
Since you haven't gotten dinged for all the money earned at your other gigs, it sounds like your getting off pretty easily.

I would pay up and hope the IRS doesn't look at your bank account and find the money you deposited from the other gigs.
 
#25
Rob-
See a tax guy. A real tax guy, not a strip-mall walk in place. This is not that hard, and don't second guess what you do and don't have to provide as far as receipts.
Just make an appointment to see a tax guy.
The same thing happened to me a few years back. I ended up covering it all.
Just go see a tax guy!!
 
#26
I am a 'tax guy'. Driving to and from gigs would most likely be considered non deductibe commutting. Other things might be deductible and might offset the 1099 amounts. But he has to be very careful since he's left off income from other sources so its a tough call to risk an audit.
 
#28
Stumbo said:
Maybe not. Here's a link to the IRS doc on business expenses: http://www.irs.gov/publications/p17/ch26.html

Check with your "tax guy".
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I've been a CPA for almost 30 yrs and a former IRS agent. Trust me, by and large first and last trips are not business related. If you leave from the rehearsal studio to the gig and then back the studio you might get it. I'm not even going to address hobby loss rules. One exception to the first and last is if you can establish that you have a studio at home.
 
#30
pedro said:
I've been a CPA for almost 30 yrs and a former IRS agent. Trust me, by and large first and last trips are not business related. If you leave from the rehearsal studio to the gig and then back the studio you might get it. I'm not even going to address hobby loss rules. One exception to the first and last is if you can establish that you have a studio at home.
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how about from my home office/studio to gigs. i have a three bedroom house and one is definitely a home office/studio.
 
#32
pedro said:
I've been a CPA for almost 30 yrs and a former IRS agent.
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Nice, I'm back in college taking accounting classes, and hopefully I'll join you among the CPA ranks in a couple of years after I complete my classes and have some work experience. Always good to see people in the accounting field on Talkbass. :bassist:


(on an aside, after reading this thread, I'm strongly considering specializing in public accounting for musicians and the music field in general after reading this thread)
 
#34
NJL said:
how about from my home office/studio to gigs. i have a three bedroom house and one is definitely a home office/studio.
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IRS recently started clamping down on this.. not as easy as it used to be...

ALL coming from a guy who gets audtied every year (self employed, own a company, own property, and on and on and on).. our package weighs about 8# when it's mailed in.

Tim
 
#35
I'd still call and talk with an agent.

IF you specifically ask to have an off the record discussion they will not record the info.

I'd request a motion to be honest... tell them how many people get paid out of the check.. then limit your portion to the payment.

yes you will owe taxes - you drove on public roads to get there.. used public cops to break up a fight.

When talking to your tax dude.. discuss setting up a 401 plan.. you'd have to incorporate.. the first 10k profit or so (I forget the number) is tax free diverted to retirement.
 
#36
i have heard the exact opposite, the IRS isn't hitting up people with home offices like back in the day..

i have an accountant by the way... he's been doing my stuff for almost 10 years now.. i just don't want to call him because then he's going to want to grab a beer or go eat chinese food. :D LOL
 
#37
Tired_Thumb said:
(on an aside, after reading this thread, I'm strongly considering specializing in public accounting for musicians and the music field in general after reading this thread)
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Just be sure to have some "real" clients other than musicians :help:

As you can probably tell when reading through these threads, musicians have a real tendancy to only loosely comply with reporting requirements. So once you get pinched, you have a very hard time defending yourself. Opening yourself up to an audit is risky at best unless your records are tight, which (as seen in evidence here so many times) is usually not the case. I'm sure a real tax guy or tax attorney will be better informed, but IIRC there is no statute of limitations for tax fraud (which failing to report income is) ... again, someone a lot smarter than me can confirm this or correct me.

If you're signing a check or giving out your SS# you are setting yourself up for reporting what you believe to be hobby income. Don't be surprised when the tax man comes a-callin' ...
 
#38
Tired_Thumb said:
Nice, I'm back in college taking accounting classes, and hopefully I'll join you among the CPA ranks in a couple of years after I complete my classes and have some work experience. Always good to see people in the accounting field on Talkbass. :bassist:


(on an aside, after reading this thread, I'm strongly considering specializing in public accounting for musicians and the music field in general after reading this thread)
Click to expand...

Hopefully the following video will convince you to choose a better career.

 
#39
MNAirHead said:
IRS recently started clamping down on this.. not as easy as it used to be...

ALL coming from a guy who gets audtied every year (self employed, own a company, own property, and on and on and on).. our package weighs about 8# when it's mailed in.

Tim
Click to expand...


I don’t think that there is any material difference in the rules for ‘Office In The Home’ but as I said, it does bring some baggage that may offset how desirable it is.
 
#40
NJL said:
i have heard the exact opposite, the IRS isn't hitting up people with home offices like back in the day..

i have an accountant by the way... he's been doing my stuff for almost 10 years now.. i just don't want to call him because then he's going to want to grab a beer or go eat chinese food. :D LOL
Click to expand...


This is one of the quick stink test audits... It's not that they go out looking for this.. once you have flags they start requesting documentation for the easy stuff.

Please note.. I get audited at least once a year... and no - they don't ever find anything.. we just have a VERY non traditional tax form... no deductions.. no job (self employed)... investment property in a few countries..... schedules up the yang.

The challenge for being a pro musician is proving that the gear is required to play... their argument would be that you'd buy guitars and strings even if not being paid... this is where the "home office" becomes fishy... meaning would you liquidate all your stuff and close it if not in active use.

Set up real books.. keep real records.. pay the taxes you owe.
 

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