3 Tax Tips for Actors from David Turrentine
Author: Adriana Trajkovsky
As most actors know, the hardest part of this crazy industry is staying financially afloat while pursuing a career. These tax tips for actors are here to help! Actors need to manage their money and find daytime gigs that allow for flexible auditions/rehearsals. An important part of money management is understanding taxes. Something that actors can be intimidated by and often overlook.
Enter David Trentin! A registered agent and actor in Chicago, he enjoyed crunching numbers after earning an MFA in Acting from UC San Diego. Trentin took advantage Vita (Volunteer Income Tax Assistance Program) and began volunteering to pay taxes for other actors. Years later, David turned his volunteer work into a business and has thrived ever since.
It’s tax filing season again! So we asked David to give us tax tips for actors. Need help breaking contracts, entitlements, and everything in between? We’ve got you covered 🙂
When you call David for help, he will immediately direct you to his website to fill out an Artist Income Tax Organizer. This worksheet will help David determine if you have all the necessary information he needs to assist you.
What was the first piece of advice David gave you? Document everything!
“Take a photo with your phone or scan them. You don’t need to keep physical receipts – you can track them electronically. If you have every piece of David’s puzzle he needs, he can report it in the best way to get the biggest deduction . Below is a list of possible deductions you can report for your reference.
Tip #2: Log your miles!
As far as deductions go, David says the biggest mistake people make is “no one likes tracking business mileage on their car. This is probably one of the biggest deductions. It may sound tedious, but according to David,” It’s not as difficult as it used to be – we all carry mini computers in our pockets now. ” MileIQ is a great example of an app for tracking miles. Need an app to help you manage your expenses? Try Expensify or Concur.
Tip #3: Get a dedicated debit card and/or credit card
As David says, another way to track business expenses is to “get a dedicated credit or debit card to track business expenses so that [you] Have a clean paper trail to use when reviewing your return. This will save you the hassle of having to look at every line item on your personal credit card statement to see what you can spend.
Since actors can’t always predict how much money they’ll make each year or where that income will come from, one thing that can catch them off guard is owing taxes. (Dang!) David promises that if this happens to you, there are other options. These options depend on your ability to pay, and solutions vary based on specific guidelines. You can arrange an installment agreement so that the taxes are paid over time. There is a process called an “offer and compromise” that occurs when someone settles with the IRS for less than what they owe. David advises that if this happens, it’s best to have someone on your side.
Extra tips: health insurance advice
Although David’s expertise is not in health care, he was happy to offer some advice to non-union participants on this stressful topic. Health insurance can be quite pricey, but he said there are ways to save money for your health care needs. One option is a health savings account, “where they link a high-deductible health plan to that savings account and use that savings account to pay for out-of-pocket expenses.” This way, your money is covered before your deductible kicks in have been set aside to pay for medical services.
If you register on the insurance marketplace, you may qualify for what’s called a “credit” to help pay for your insurance if it falls within certain income brackets. These credits depend on what you enter on your application and your best guess on how much you’ll earn, which can be tricky if you’re not sure of the exact amount (actor life). That’s never going to be accurate, David says, so “it’s something you need to monitor and sometimes go back to the market throughout the year and update the numbers to make sure you’re getting the appropriate credit.” If your income increases, be safe The option is to “set aside money to repay the premium credit”. For now, we need to pay attention to potential changes to the ACA.
David believes that “almost anyone with a 1099 income can benefit from the deduction on their tax return.” If you feel overwhelmed by the process or want to make sure you are taking advantage all possible deductionsdon’t wait until early April to seek assistance. While hiring a tax preparer may sound expensive, you’ll actually save money in the long run!
