If you work in the entertainment industry, chances are your taxes are a bit more complicated than the average 9-to-5-er. One of the most useful resources available to the theatre community is a VITA program (Volunteer Income Tax Assistance) run by Actors Equity, SAG/AFTRA, and IATSE. Staffed by volunteers with IRS training, this program provides free tax support specifically tailored to theatre professionals. The New York VITA office is open year-round, and welcomes visits by appointment as well as walk-ins. A branch in Los Angeles, operated by the Actors Fund, shares the load during tax season. Artists who take advantage of this VITA program receive one-on-one coaching to complete their tax returns.
To help the meeting run smoothly, you’ll have some prep work to do. Visit your union’s website for a set of PDFs that you’re required to bring to the meeting, including document checklists and easy-to-complete tables specific to those who worked in multiple states or for multiple companies. (See: Definition: artist.)
Even if you’re confident you can prepare your own forms, they’re a great resource to arrange tax data. And if you do meet with the VITA volunteer, the sheets will speed up your visit. It should only take one meeting to complete your return. For those outside New York City and Los Angeles, call either VITA office with questions.
Free assistance with tax prep is not limited to unions members. Additionally, many non-union organizations, like SDC and the Playwrights Center, will often email members during tax season with suggestions on how to stay organized. Artists who make $54,000 or less per year can call on one of the IRS’ own VITA programs, located in the public buildings and libraries of all 50 states. Special services are also available for taxpayers with limited English and for seniors.
Whether you prepare your own taxes with VITA or hire an expert, there are some basics everyone should know. The IRS considers most working performers ‘self-employed,’ and recognizes that income can come from several sources. Like a day job, a long-term engagement usually withholds a certain amount from your pay for taxes (that’s the case with Equity productions, for example). Early in the new year, those employers should send you a W-2 form, listing the amount you were paid and the amount they withheld.
Then there are the gigs—performances, readings, voice-over work, etc.—which cut a small one-time check or pay cash. These employers won’t withhold taxes from your wages, and the company may or may not send you a year-end form, called a 1099-MISC. This is the knottier part of your income to calculate, especially since it’s supposed to be taxed quarterly. So over the year, it’s a good idea to write down how much you get paid for each job. (If you didn’t do that in 2016, don’t worry, but start keeping records for 2017 now.)
While you’re at it, save your receipts and regularly log them into a spreadsheet. Creative professionals can often deduct a portion of travel costs and meals (this is especially true for touring actors without per diem), as well as miscellaneous items like agent fees and union dues, acting lessons, headshots, and stage makeup. Even theatre and film tickets can fall under deductible items, since an artist needs to stay current. Don’t get greedy though, or the IRS may flag you for an audit.
If preparing your own tax returns sounds too daunting, you should consider working with a professional accountant. The potential savings may offset the cost, plus you can deduct it next year! It’s worthwhile to seek out a CPA who focuses on the entertainment industry. Like the volunteers at the unions’ VITA program, a specialist will have a deeper understanding of the quirks of show business. Whether you calculate your own taxes or hire a pro, the more you know about your finances, the better off you’ll be.