Don’t miss a single deduction! Here, a checklist of write-offs for studio owners and freelance teachers.

It’s that time again—tax time. (Insert groan here.) You may not be thrilled to sit down and tally up just how much you owe the government, but you can at least ease the pain by being smart about taking the tax write-offs available to studio owners and freelance teachers. Are you making the most of them? Do you even know what they all are? Read on to learn about the major types of write-offs (plus a few that are often overlooked), and check out the sidebar for specific business expenses dance teachers and studio owners are allowed to deduct.

What Is a Write-Off, Anyway?

Write-offs reduce the total income you’ll be taxed on as a business owner. If your business brings in $75,000, for example, and you can deduct $10,000 in write-offs, you’ll only be taxed on $65,000. Write-offs, says arts and entertainment accountant Jessica Scheitler, break into three categories: business expenses, personal deductions and credits.

Business expenses are the expenses directly incurred from running your own business (studio owners) or teaching (freelance teachers). (You’ll need well-organized receipts, of course.)

Personal deductions are nonbusiness expenses: your home mortgage interest, property taxes, any charitable donations you make. “Everyone, whether you’re in business or you’re a W-2 employee or even unemployed, gets personal deductions,” says Scheitler. “These can be itemized, or you can take the standard deduction [$6,200 for an individual in 2014].”

Credits, though they still reduce the amount of taxable income you owe, are treated differently: You won’t get too many, and you have to qualify. An example would be the health care tax credit: For 2014, if you have fewer than 25 employees, pay them an average salary of less than $50,000 and pay at least half of their health insurance premiums, you can get up to 50 percent back on those premiums. “In tax preparer land, every credit has a separate form,” says Scheitler. “They’re more complicated, but they usually get you more money back.” DT

 

Did you know?

*“You can go negative on business expenses!” says Scheitler. “Most new businesses go negative, and the IRS allows this.” The general rule is that you can lose money for three out of five years, but “then you need to start gaining ground.”

*You should be keeping track of your income and expenses all year long. Scheitler meets with her studio owner clients in November or December so “we can see what’s going on in the business and buy extra stuff or make changes so that their tax is as small as possible. It puts studio owners in the driver’s seat if they look at it before the year ends.”

*Though having an accountant file your taxes might not be the best fit for everyone, there are definitely perks. A professional tax preparer will be familiar with common audit triggers and can steer you clear of them. “There are a lot of minor mistakes that can happen,” says Scheitler. A professional offers you another pair of eyes and a fresh perspective.

 

7 Write-offs Often Overlooked

1 Business gifts “This could be any gift [worth $25 or less] that’s intended to advance your business,” says Scheitler. “I have a tattoo artist client who buys snacks and beer for his clients while they get tattooed. He might be thinking about customer service and trying to be nice, but that still counts.”

2 Copyright expenses

3 Makeup, hair and nails for

theatrical use Your own haircuts don’t count—but the sparkly stage makeup you buy for your comp kids to wear for that aliens piece definitely does.

4 Memberships, dues and

subscriptions Like your subscription to Dance Teacher!

5 Muscle conditioning and massage

6 Website expenses

7 Tour and convention travel Hotels; meals; car rental; gas; parking; tolls; air, rail and bus fares

 

What You Thought You Could deduct—But Can’t

Gas receipts These alone won’t get you a write-off. You need to log your mileage for business travel, using odometer readings, and note the business purpose for each trip. “We need to show the total miles and how many were for business,” says Scheitler.

Donated time or lost wages “You don’t get to write off volunteer time,” says Scheitler. “And you can’t say, ‘I didn’t get paid for this, so subtract the $500 I should’ve gotten paid.’ That would mean we’re writing off the time you spent, and you don’t get to write off time.”

 

What Can I Deduct?

Advertising and promotion

Banking service charges for business accounts

Business cards and printing

Business-deductible mortgage interest (if you own your studio building)

Business meals and entertainment (you’ll get a 50 percent deduction on your tax form)

Cell phone (if your personal phone doubles as your business phone, your write-off is based on a usage percentage)

Clothing (dancewear)

Commissions and fees

Computer and internet expenses

Continuing education (the Dance Teacher Summit you attended, for example, or the marketing seminar)

Contract labor (someone who is not your employee—anyone who gets a 1099)

Costuming

Discounts on tuition (In your records, always show the original total, and then subtract the discount, a tax-deductible expense.)

Equipment leases

Health insurance premiums (Depending on your business type, it will be done differently; consult your accountant.)

Legal fees

Liability insurance

Licenses and permits

Music and sound equipment

Office supplies and expenses

Payroll taxes

Postage and printing

Publicist

Repairs and maintenance

Retail inventory (dance supplies, for instance)

Salaries and wages

Sheet music, CDs, DVDs, iTunes

Studio rent

Studio supplies

Tax and accounting fees

Transportation (parking, fees, tolls, noncommuting cab fare)

Utilities

Thinkstock

The Conversation
Dance Teachers Trending
Photo by Julianna D. Photography, courtesy of Abreu

Although Rudy Abreu is currently JLo's backup dancer and an award-winning choreographer—his piece "Pray" tied for second runner-up at the 2018 Capezio A.C.E. Awards, and a variation of the piece made it to the finals on NBC's "World of Dance"—he still finds time to teach. Especially about how he hears music.

Keep reading... Show less
Sponsored by Dance Teacher Web
Courtesy Dance Teacher Web

Dance students aren't the only ones who get to spend their summers learning new skills and refining their dance practice. Studio owners and administrators can also use the summer months to scope out new curriculum ideas, learn the latest business strategies and even earn a certification or two.

At Dance Teacher Web's Conference and Expo, attendees will spend July 29–August 1 in Las Vegas, Nevada learning everything from new teaching methods to studio management software. And as if the dance and business seminars weren't enough, participants can also choose from three certifications to earn during the conference to help expand their expertise, generate new revenue and set their studios apart:

Keep reading... Show less
Dance Teacher Tips
Getty Images

James Payne, director of The School of Pennsylvania Ballet, starts class each day by asking students how they feel. "If they're collectively hurting, and I know that the day before they were working hard on something new, I might lessen the intensity of the class," he says. "I won't slow it down, though. Sometimes it's better to move through the aches and get to the other side."

A productive class depends, in part, on how well it is paced. If you move too slow, you risk losing students' interest and creating unwanted heaviness. Move too fast and dancers might not fully benefit from combinations or get sufficiently warm, increasing their risk of injury. But even these guidelines may differ depending on the students' age and level. Good pacing is a delicate balance that can facilitate mental and physical growth, but it requires good planning, close observation and the ability to adapt mid-class.

Keep reading... Show less
David Galindo Photography

New York City is a dream destination for many dancers. However aspiring Broadway stars don't have to wait until they're pros to experience all the city has to offer. With Dance the World Broadway, students can get a taste of the Big Apple—plus hone their dance skills and make lasting memories.

Here's why Dance the World Broadway is the best way for students to experience NYC:

Keep reading... Show less
Getty Images

Q: Our dancers' parents want to observe class, but students won't focus if I let them in the room. I've tried having them observe the last 10 minutes of class, but even that can be disruptive and bring the dancers' progress to a halt. Do you have any advice on how to handle this?

Keep reading... Show less
Studio Owners
Getty Images

Running your own studio often comes with a pull-yourself-up-by-your-bootstraps mentality. After all, you're the one who teaches class, creates choreography, collects tuition, plans a recital, calls parents, answers e-mails, orders costumes—plus a host of other tasks, some of which you probably don't even think about. But what if you had someone to help you, someone who could take certain routine or clerical tasks off your hands, freeing you up to focus on what you love?

Keep reading... Show less
Dance Teachers Trending
Derek and Julianne Hough via @juleshough on Instagram

Here at Dance Teacher, we LOVE a talented dance family. Something about parents and siblings passing their passion for dance down to those who come after them just warms our hearts.

While there are many sets of talented siblings across all genres of dance, ballroom seems to be particularly booming with them.

Don't believe us? Check out these four sets of ballrooms siblings we can't take our eyes off of. Their parents have raised them right!

This is far from a comprehensive list, so feel free to share your favorite sets of dance siblings over in our comments!

Keep reading... Show less
Courtesy of Roxey Ballet

This weekend, Roxey Ballet presented a sensory-friendly production of Cinderella at the Kendell Main Stage Theater in Ewing, New Jersey, with sound adjustments, a relaxed house environment and volunteers present to assist audience members with special needs. The production came on the heels of three educational residencies held at New Jersey–based elementary schools in honor of Autism Awareness Month in April.

Keep reading... Show less
To Share With Students
Shared via Dance Teacher Network Facebook

I'm a part of a popular group on Facebook called Dance Teacher Network which consists of dance teachers across the country discussing and sharing information on all things dance. Yesterday morning, I spotted a photo shared in the group of four smiling young boys in a dance studio. And I couldn't help but smile to myself and think, "Wow, I never had that...that's pretty damn amazing."

Keep reading... Show less
Dance Teachers Trending
Photo courtesy of Marr

When Erica Marr discovered ballroom dancing in her late teens, she instantly fell in love with the Latin beats and strong drum lines that challenged her musicality. After shifting her focus away from contemporary and jazz, she began studying with elite ballroom coaches in New York City and quickly earned a World Championship title in her division.

Keep reading... Show less
Studio Owners
Thinkstock

Q: I own a studio in a city that has a competitive dance market. I've seen other studios in my community put ads on Instagram and Facebook for open-call auditions in April, long before most studios have finished their competition season and year-end recitals. Is this fair?

Keep reading... Show less

mailbox

Get DanceTeacher in your inbox