It’s something that can’t be avoided, personally or when owning your own business. Since this is April you probably guessed that what I’m talking about is taxes. Like most photographers you probably started your own photography business out of passion. It’s what you love doing and it’s exciting!
Maybe it started as a hobby and then grew into a full or part-time business and now with tax season upon us it’s time to take a look at your revenue and deductions. Remember many of those operating expenses you had throughout the year can be deductions or at least a percentage can be.
Included here is a list of the top common tax deductions for your photography business. You may wish to print or bookmark the list for reference next year as well. My first bit of advice though is to recommend that you become organized and keep excellent records. It makes tax time so much easier and is essential should your business ever face an audit.
Dues and Subscriptions
If you belong to any professional groups, clubs, or organizations for which you pay dues, those dues or membership expenses are tax deductible. Also are your expenses for any subscriptions to photography magazines, newsletters, or other industry publications.
Expenses accrued for continuing education purposes such as seminars, classes, even online workshops and training are deductible if they are in keeping with your style of photography business. This can also include any books and necessary supplies for completing the program. Just be certain that these expenses can be proven to be for professional and not personal gain.
The cost of equipment that will last more than one year needs to be shown as a depreciated expense on your taxes. Equipment that may fall into this category can be your cameras, camera bags, props, and lighting or darkroom equipment. Computers and digital devices can also be depreciated if they are solely used for your photography business.
Some equipment repairs are deductible if they were essential costs for operating your photography business.
Property insurance that covers your photographic equipment or studio space is a deduction, as is a portion of your homeowners insurance if you operate your business out of your home.
As a self-employed professional you can also deduct your entire health insurance premium from your taxes.
Office and Studio Space
Your office, studio, and gallery can all be tax deductions if they are solely used for your photography business. This is true even if you use a shared location; simply deduct only the amount you personally pay. If your business space is totally outside of your home, all rent and utilities are deductible business expenses.
Don’t forget, you can also deduct things that you use in your studio space such as any office supplies, water delivery services and other services you may use in your studio.
Phone and Internet
If you operate your photography business out of your home and you have a separate phone line strictly for your business, the cost of that phone line and any long-distance charges are deductible expenses. Don’t forget to include your internet bill as well since you probably use that in your business too.
Marketing and Promotions
You most likely have a website for promoting your business. The expenses for operating that website such as hosting services, software, or contracted web designers are deductible as long as they are separated from personal use. Be sure to keep accurate records to support these deducted charges.
Any sort of activity that involves marketing or advertising your business can also be deducted. This might include ad space you buy, fees to print marketing materials, your business cards, flyers, brochures, pricing sheets, and even your studio sample prints and albums you may have in your photography studio.
Photography Gear and Supplies
All gear and supplies that don’t require depreciation can be included in calculating your tax deductions. This includes any cameras, flash or lighting equipment, film and processing, memory cards and storage devices, and props. This even includes the cost of mail and shipping preparation materials. Keep all actual receipts not simply credit card or bank statements for this equipment.
Professional and Promotion Fees
All professional fees for attorney, accountant, or consulting services are deductible. Simply retain their invoices with your tax preparation paperwork. This includes any business license, permits, or copyright fees.
Staff and Assistants
Should you have any permanent or temporary persons assisting you with your business, even if they are simply hired on a contractual basis, the salary or fees you paid them is a tax deduction. In some instances, this can include their lodging and meal expenses.
Air travel, transportation, and lodging expenses can be deductions if not reimbursed by your client. Local travel expenses when related specifically to a photography assignment or educational training can be deductions. You can choose to keep receipts for all mileage, fuel, auto repairs and service, and itemize this deduction or you can simply calculate using the standard mileage rate provided by the IRS.
Keep in mind that this list is provided as a courtesy and should not replace professional legal or accounting advice. Always look upon any deduction as to how it relates to your photography business and keep it pertinent and relevant to your actions for carrying out your business.