April 15th

Jennifer Visick said: Apr 15, 2010
Jennifer VisickForum Moderator
Suzuki Association Member
Viola, Suzuki in the Schools, Violin
998 posts

For those in the US… Having just e-filed my taxes, I wonder if any of the other teachers on this forum have advice or would share experience about how they do taxes, keep records, save time, etc.

Do you hire a tax professional, or do it yourself? Any tips on how to keep good records—to save time next year? What kinds of deductions/business expenses do you use?

Michelle said: Apr 15, 2010
 
Suzuki Association Member
Viola, Violin
25 posts

Quicken and Turbo Tax, both for small businesses. I also have one credit card set aside for “business purchases” but I don’t always stick to that. Quicken does a great job of tracking things and providing good reports. Turbo Tax asks me all the questions to get all my business deductions in. I also use Music Teacher’s Helper to manage my studio, which tracks income, some expenses, and mileage. It’s more of a back up, as I don’t take the time to enter all my expenses there, but I do use it as my primary mileage tracker. I also keep a written log book in the car. The IRS likes it in writing.

This year I got the first time homebuyer credit (woo!) and learned that a home office that you own is a bigger deduction than one that you rent. Sadly that required a paper filing so my refund will take a while to get to me.

Now available in blog form.

Sara said: Apr 18, 2010
 Violin
191 posts

I hire a professional. Not only does it save time for me, but also the tax professionals are current in the tax laws and often can find ways to help you save that you might not have found on your own.
As far as tracking—track EVERYTHING. Every purchase that you make that you use for the studio—After meeting with my tax accountant the first time I was surprised at what could be deducted.

“What is man’s ultimate direction in life? It is to look for love, truth, virtue, and beauty.” Dr. Shinichi Suzuki

Lynn said: Apr 22, 2010
 
Suzuki Association Member
Violin, Viola
173 posts

I could never remember to use a mileage log in my car to keep track of deductible business miles, so to track mileage, I have a master list of locations where I frequently rehearse or perform, churches where I play weddings, and stores where I pick up office or music supplies, and the round trip mileage from my house. Gig dates are in my desk calendar, so I just write in the rt mileage next to the gig. For store runs, I write the rt mileage on the receipt.

Linda Louise Ford said: Apr 14, 2013
Linda Louise Ford
Suzuki Association Member
Violin
Rochester, NY
16 posts

Hi. Where would I put the tax deduction of a new violin, bow and case that I use for my home violin studio? I understand that my new instrument IS deductible but which category do I put it under? Thanks for answer in advance. Linda

Linda

MaryLou Roberts said: Apr 14, 2013
MaryLou RobertsTeacher Trainer
Institute Director
Suzuki Association Member
Guitar
Ann Arbor, MI
244 posts

I put instrument purchases in supplies, but I am not a tax expert.

Lori Bolt said: Apr 15, 2013
Lori Bolt
Suzuki Association Member
Piano
San Clemente, CA
226 posts

I believe that I put the purchase of a piano under “equipment”. I’m no expert either. I like the tip re: mileage written on receipts. I’ve been forgetting to log it.

Lori Bolt

Wendy Caron Zohar said: Apr 15, 2013
Wendy Caron Zohar
Suzuki Association Member
Violin, Viola
Ann Arbor, MI
94 posts

Re: the purchase of instruments for use in your business; i.e. your professional and studio work, I have received advice that these should be amortized over years, rather than counted and deducted against your income all at once, in one calendar year. That’s because our instruments don’t get used up or “consumed”, like folders, printing paper or ink cartridges, which do get listed under supplies or equipment. You should amortize any equipment that you expect will function for you for the long haul, like a decade plus! Of course what distinguishes office equipment like fine chairs, desks, a nice laser printer or a new computer, from musical instruments and bows, is that our instruments, like objects d’art generally don’t drop in value, but rather increase. At the same time, we don’t buy them as investments, but rather, as tools of trade. Best thing is to find a tax specialist who works with practicing musicians.

Maybe someone can find such a specialist who’s willing to answer questions live, online?

Good luck!

Wendy Caron Zohar

Mengwei said: Apr 15, 2013
Mengwei Shen
Suzuki Association Member
Violin, Piano, Cello
Jersey City, NJ
120 posts

I have an Excel file and categories of spending. I have instruments vs. non-instrument teaching supplies separated for my own benefit but put them all in “Supplies” for taxes. I think LARGE instrument purchases should really be capitalized (expense deducted over several years) but for example, if I buy one $200 bow, I doubt I’ll bother tracking it.

Caitlin said: Apr 16, 2013
Caitlin HunsuckViolin
Merced, CA
41 posts

I know this is a day late… but instruments would go under “Business Assets” in Turbo Tax. The reason you would amortize something is to spread out your expense over the years. You would really want to do this if your instrument (or any asset) cost you MORE than your net profit this year. So say you bought a $50,000 violin, but you only made $25,000 net profit this year. Well you would want to amortize it over a few years so that you don’t have a net loss of ($25,000). The idea is you would be able to deduct it as an expense over the years and help out your future taxes. I would only amortize if you are making a net loss. If you are making a profit you might as well enjoy your tax break this year.

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