Talking Deductions

		Talking Deductions
*In "ActorSpeak"* For most of us the work of preparing for and seeking work as an actor is what takes all of our time and money. Working or auditioning is the same thing to us. It isn't to the IRS, and that is the biggest problem most actors have determining their deductions. If a producer tells you to color your hair or lose ten pounds, it is a write-off. But we all know that if we don't have the right hair color or need to lose the ten pounds, we aren't going to get the job unless we are already a star. Generally with the IRS there is little middle ground unless you follow the guidelines they demand to prove the legitimacy of your deductions (Can you prove you actually spent the money) AND the relationship of those deductions to our business as "Ordinary" and "Necessary" expenses. As you can see, on one side of our pages we will present the actual IRS language (*"In the Words of the IRS") that they use as a guide to make their decisions and, if necessary, on the other side of the page we will explain ("In ActorSpeak"*) what the IRS means in "English" and why the IRS has come to the conclusions it has. We don't pretend it makes you feel any better, but the purpose is to help you understand the basis of their decisions and as a result, better prepare yourself for being able to prove why a particular deduction is a valid business expense for you. Good luck!		In the Words of the IRS: "Entertainers have been known to make a convincing argument about how much they have to spend to "stay on top" or keep current; nevertheless, most of these items typically overlap too much with personal expenses to constitute business deductions. " An ordinary expense* is one that is common and accepted in your field of trade, business, or profession.* A necessary expense* is one that is helpful and appropriate for your business. An expense does not have to be indispensable to be considered necessary.* *Back to Topics*

Talking Deductions

In "ActorSpeak"

For most of us the work of preparing for and seeking work as an actor is what takes all of our time and money. Working or auditioning is the same thing to us. It isn't to the IRS, and that is the biggest problem most actors have determining their deductions.

If a producer tells you to color your hair or lose ten pounds, it is a write-off. But we all know that if we don't have the right hair color or need to lose the ten pounds, we aren't going to get the job unless we are already a star.

Generally with the IRS there is little middle ground unless you follow the guidelines they demand to prove the legitimacy of your deductions (Can you prove you actually spent the money) AND the relationship of those deductions to our business as "Ordinary" and "Necessary" expenses.

As you can see, on one side of our pages we will present the actual IRS language ("In the Words of the IRS") that they use as a guide to make their decisions and, if necessary, on the other side of the page we will explain ("In ActorSpeak") what the IRS means in "English" and why the IRS has come to the conclusions it has.

We don't pretend it makes you feel any better, but the purpose is to help you understand the basis of their decisions and as a result, better prepare yourself for being able to prove why a particular deduction is a valid business expense for you.

Good luck!

In the Words of the IRS:

"Entertainers have been known to make a convincing argument about how much they have to spend to "stay on top" or keep current; nevertheless, most of these items typically overlap too much with personal expenses to constitute business deductions. "

An ordinary expense is one that is common and accepted in your field of trade, business, or profession.

A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be indispensable to be considered necessary.

Back to Topics