Mindblown: a blog about philosophy.
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Tax Parity Act Would Help W-2 Musicians
In 2018, the Tax Cuts and Jobs Act (TCJA) eliminated Unreimbursed Employee Expenses as a tax deduction. For musicians who are W-2 employees, this meant we lost the ability to deduct expenses, often significant, like our instruments and equipment, concert clothes, repairs, a home office, travel for work, study, or auditions, and even Union dues.…
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Musicians’ Pension to Cut Benefits
On May 24, the AFM Employers’ Pension Fund (AFM-EPF) announced that the plan has entered Critical and Declining status and would be applying to the Treasury Department for authorization to cut benefits to its 50,000 participating professional musicians and beneficiaries. The plan is calculated to fail in less than 20 years, including anticipated future contributions…
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Taxes Going Up? Here’s What Musicians Can Do
My clients are completing their 2018 tax returns and it is a mixed bag. Many musicians who used to itemize their deductions, especially married couples, are now taking the standard deduction for the first time in decades. Some are seeing their taxes go down while others, myself included, are paying thousands more for 2018 than…
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Musicians over 65: Start your Pension Before it is Reduced
This week, the trustees of the Musicians’ multi-employer pension, the AFM-EPF, announced that the fund “will likely enter ‘Critical and Declining’ Status in 2019”. A musician friend, who recently turned 65, asked me if there was anything we could do. If the plan enters Critical and Declining status, it means that the fund is going…
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New IRS Rule Spoils SEP-IRA for Musicians
The SEP-IRA has been a key retirement tool for self-employed and 1099 musicians, but its value just got unexpectedly reduced last month, buried in the details of a 249-page release of new IRS regulations. I’m afraid that many self-employed musicians who read this may want to fund a different type of retirement account or may decide…
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7 Missed IRA Opportunities for Musicians
The Individual Retirement Account (IRA) is the cornerstone of retirement planning. Unfortunately, many musicians miss opportunities to fund an IRA because they don’t realize they are eligible. With the great tax benefits of IRAs, consider funding yours every year you can. Here are seven situations where many musicians don’t realize they could fund an IRA.…
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Your Goals for 2019
Welcome to 2019! A new year brings a fresh chance to accomplish your goals. No one becomes a musician for the paycheck, but at the end of the day, musicians have the same financial goals as most people: to become a home owner, pay off your student loans, get married, raise a family, plan for…
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Musicians and the QBI Deduction
This year, there is a new 20% tax deduction for self-employed individuals and pass through entities, commonly called the QBI (Qualified Business Income) deduction, officially IRC Section 199A. While most musicians who file schedule C will be eligible for this deduction, high earners – those making over $157,500 single or $315,000 married – will see…
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Starting a Profitable Music Studio
Many professional musicians find teaching to be personally fulfilling and an important part of their annual income. Sharing your love of music with someone else is incredibly rewarding and a way of giving back for the great teachers who inspired us to follow our own path. Teaching the content is easy, but I think many…
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Estimated Tax Payments For Musicians
The IRS requires that tax payers make timely tax payments, which for many self-employed musicians, including 1099s, means having to make quarterly estimated tax payments throughout the year. Otherwise, you could be subject to penalties for the underpayment of taxes, even if you pay the whole sum in April. The rules for underpayment apply to…
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