tax deductions for photographers
The sheer uttering of the phrase income tax makes many of us cringe. Nobody likes the thought of the tax man taking their hard-earned money out of their pockets. But with tax deductions, you can limit the tax man’s take.
A tax deduction reduces the amount of revenue subject to tax for specific types of expenses that were incurred to produce the income. These expenses are entered into a “schedule” in your tax return.
Let’s say you spent $5,000 on equipment this past year, and your business had revenues of $30,000. You can take a tax deduction for that full $5,000 so that you will only have to pay income tax on $25,000. This means you are going to have to pay tax only on the amount of money your business actually made in a given tax year. Well, sort of.
Not all expenses qualify as deductions. Federal and state tax laws detail exactly what deductions can be taken. The following deductions are ones that every photographer should know about.