Join Richard Stim for an in-depth discussion in this video How do you manage bookkeeping?, part of Taxes and Accounting for Music.
- The best way to track your financial records…is the simplest, most foolproof method that works for you.…For example, if your total music business earnings…are less than $10,000 a year,…and you're primarily earning money…from performing and merchandise sales,…you can probably avoid serious number crunching…by using an Excel spreadsheet…or a software program, such as Quicken,…or the online program Mint.…You can also use a paper notebook.…If your music business is more complex,…for example, you're grossing over $10,000 a year,…or you've formed an LLC,…you can purchase more sophisticated software,…such as QuickBooks…or consider hiring an accountant.…
By the way, accounting costs are tax-deductible.…You can also get bookkeeping assistance from the IRS…by reviewing Publication 583.…One bookkeeping suggestion,…if possible, maintain separate, personal,…and music business bank accounts.…If that's not possible,…try to dedicate a credit card solely for music business use.…What should you track?…Basically, you need to track income and expenses,…
In this music business course, author Rich Stim covers the most important tax issues for musicians. He starts with the basics: determining if music is a hobby or a business for you and how that affects your deductions. He then discusses money and the sources that determine gross income. From there, he shows the items you can deduct from your gross income—mileage, studio spaces, touring expenses, and other miscellaneous deductions—that can add up to big savings. Next, he covers the different tax rules for individual musicians, bands, general partnerships, LLCs, and corporations, and explains how to get an Employer Identification Number (EIN) when you need one. Finally, Rich navigates through the tax forms, including Form 1040, Schedule A, Schedule C, Schedule SE, Schedule K-1 (Form 1065), Form 4562, Form 8829, and Form 2016, and provides advice on hiring a tax preparer or going the DIY route with tax software.
DISCLAIMER: This course is taught by an attorney (or other instructor) and addresses US law concepts that may not apply in all countries. Neither LinkedIn (including Lynda.com) nor the instructor represents you and they are not giving legal advice. The information conveyed through this course is akin to a college or law school course; it is not intended to give legal advice, but instead to communicate information to help viewers understand the basics of the topic presented. The views (and legal interpretations) presented in this course do not necessarily represent the views of LinkedIn or Lynda.com.
- Managing bookkeeping
- Counting income
- Claiming expenses and other deductions
- Understanding tax entities such as LLCs
- Getting an employer ID number
- Preparing and paying taxes