Tax advice for gig economy workers

tax deductions forms

 

From the LA Times, Jim Puzzanghera shares tax advice for gig workers.  Jim writes:

What are some types of expenses that can be deducted?

Anything that’s ordinary and necessary to carry on your business. [For those in the entertainment industry], if you have an agent, audition expenses, head shots and photos, a publicity agent, a resume, hair care, manicures.

Typically there’s travel, entertainment and vehicle expenses. Those are often used by most self-employed businesspeople.

The business portion of the house that you’ve got dedicated to generating the income, that percentage of the square footage that’s used only for business, you can deduct a percentage of those expenses.

If you’re self-employed, you should keep track of it throughout the entire year. It’s hard to keep track of things retroactively, particularly mileage on a car. You want to know what your beginning mileage is Jan. 1. Any time you’re driving for business, you should be keeping track of that.

The more detailed or specific your documentation is, the better. Mileage on an automobile is always a gray area. It’s kind of your word against the IRS on how much you’ve driven for business vs. pleasure. [Tip: Get your vehicle serviced near the start and end of the year so the records will include your odometer readings.]

You want to be well aware of all the eligible expenses, particularly those that might be unique to your work. [The instructions for IRS form Schedule C contain information on eligible business expenses.]

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