Modeling & Taxes (Recording Income & Write Offs)

(This post is mainly targeted towards freelance models with no agency representation. However, much of the information in this post can be applied by those with agency representation. If you are a parent of a model under 18, take note of the information dealing with write offs—you could greatly benefit).

***This is an update paragraph for this blog post. While I originally stick by my statement that proving to the IRS (if you get audited) that certain expenses should be deemed a tax write-off  in regards to modeling can be very difficult, I did want to mention that it is possible to have these write-offs honored (i.e. makeup, hair products, spa/body treatments) if you have solid receipts and proof of the strength of your modeling career. Tearsheets, resumes, portfolios, etc. are all solid pieces of "proof" that modeling is a major part of your life, so much so, that it results in incurring expenses. Provide this info and you shouldn't have a problem with Uncle Sam.***

Ask anyone that is a freelancer, independent contractor, or business owner if there is anything they hate more, it’s paying taxes, but if you ask what they like best, they’ll more than likely tell you they love the ability to write off a number of things that are considered “business related.” So what does this mean and what does it have to do with you and your modeling career?

As an independent contractor/freelancer, you are basically your own business. This puts you in a different category than someone that is employed by a company, especially when it comes to taxes and other related topics. Being a freelance model means you’ll need to be super organized and keep track of a number of factors that relate to your modeling career.

My first piece of advice for freelance models is to get record books for keeping track of not only the money you make from your modeling gigs, but to also record any money you spend as a result of your modeling career. Certain purchases you make or expenses you incur can be considered a tax write off.

As a freelancer, tax write offs are important because that means you’ll more than likely get a percentage of that money back in the form of a tax refund. If you don’t report it, you won’t get anything back. However, not all things can be considered a tax write off and lying or including things that aren’t actually business related can get you into a lot of trouble with the IRS.

When it comes to modeling, the following are common tax write offs:

- Gas/Mileage: Do you own your own car and use it to go to and from go-sees, auditions, interviews, and photoshoots? Then you can use your car, the mileage and the gas money you spend as a tax write off. In most cases you can even use your car itself as a tax write off—I do!

Any money spent on repairs, oil changes and other factors may also qualify as a tax write off. If you take public transportation to get to your gigs and/or pay for passes or memberships to allow you to take that mode of public transportation, then keep track of the receipts/tickets, and record that in your book. This all counts towards money spent that is business related.

- Parking/Tolls: Keep all receipts anytime you use a parking garage when driving to a modeling gig. If you have to pay toll, record the amount you paid, the date and where you were headed in your record keeping book.

- Travel: If you have to catch a plane or stay in a hotel for a modeling gig that the client does not pay you for, this expense can be used as a tax write off. Again, keep all receipts and write down the specifics in your record keeping book.

- Office supplies: Do you print your own comp cards? Did you spend money to have a company do them for you or do you purchase your own printer ink and special photo paper? This could be a tax write off for you since it directly relates to your modeling career.

Please don’t try to include personal things into your modeling career track record, such as personal trips that you falsely list as business related, making up expenses, etc. The IRS is very thorough and all the information you report will be investigated and checked for authenticity.

To make things easy, set aside a folder or large envelope where you can store all of your receipts, which you can provide to your tax professional when you’re ready to file your taxes. Record keeping may not be the most fun but motivate yourself by thinking of the money you will be getting back as a tax refund—that always reenergizes me!

In terms of what can’t be considered a tax write off for modeling (this is highly debatable but is what I believe shouldn’t be counted, based on my research and people I’ve talked to):

- Makeup & hair products: Trying to justify writing off purchases of hair and makeup products is a difficult case to make against the IRS for the simple fact that when it comes to modeling, this type of expenses isn’t solely isolated to your modeling profession.

To translate, you would need to prove without a doubt that the makeup and hair products you spent money on are only used when you model. Hmmm…a girl buying makeup and hair products but not using it unless it’s for modeling? Not a very strong or convincing argument. Even if you buy an outrageous eye shadow color, there are girls that walk around with such crazy shades everyday. Again, not a justifiable reason.

- Clothes: This is a tricky one so my rule of thumb is as follows: the only time you can write off buying clothes is if the outfit you buy can only be worn for modeling purposes and not for everyday wear. So if you buy a cute sundress for a photoshoot, chances are you’ll also wear it when you’re not modeling—not a tax write off.

That leopard print cat suit with the plunging neckline or the ballerina outfit…that can be seen as a tax write off because where would you wear such outfits outside of the modeling realm? See the difference? So unless the outfit is so outlandish that you would not wear it normally, then you can’t justify writing it off.

- Spa treatments and related services: You don’t need to be a model in order to get a facial, massage, hair removal, manicure or pedicure so while you may only spend the money on such services to prep for a photoshoot, it isn’t a business related expenses because everyone gets these http://www.blogger.com/img/blank.giftreatments done.

Some tax professionals may allow you to use these as write offs, but know that you do so at your own risk. I personally would not recommend it unless you are booking enough paid modeling work to justify those expenses. There are plenty of models that I’m sure write these things off all the time but again, I would not suggest it to anyone and while it may work for those people, the IRS is not an entity I would ever take a risk with. Just my opinion.

One last point I want to make about this subject is that if your modeling-related expenses end up totaling more than the amount of income you make from modeling for several tax years in a row, the IRS could determine that modeling is not an actual profitable career for you but is a "hobby." If they make that determination, you could end up getting taxed and owe money to the IRS as a result.

Even if you freelance part-time and have another job or are a student and model on the side, keeping track of your expenses and income is a must if you want to get a tax refund. If you have any questions or special situations, be sure to ask your tax professional for their advice.