With April 15 fast approaching, I am still avoiding filing my taxes for 2004 like the plague. I talked to a financail guy and he told me I might be able to off-set my taxable income by depreciating equipment over time or take it all up front (or something like that). I have saved every receipt that had anything to do with the start-up of getting this DJ'ing gig up and going. Can you guys give me any tips or suggestions you have used in the past to help compensate for the initial cost of equipment and what not? Any help will be greatly appreciated. Thanks in advance. - Danjah

Very elementary article about dj & taxes in this months DJTimes. Pretty much if you use it or bought it for your dj activities and you have enough dj income and the associated taxes to warrant concern, you can deduct it however you deem best.

However and unless you have a tax expert in the family, and you generate enough income djing, hire an expert and you may even save enough to pay for his/her expertise.

Good Luck!

Maybe I understood the guy wrong, but I assumed that he meant that I could deduct any losses from my taxable income. I am assuming my taxable income meant my 8-5 salary, because I didn't earn a dime after starting in October. Let's say my salary is 40K and I invested 10K into a small business then I could offset the the 40K by 10K and possibly receive a return. A return would be nice, but I would be thrilled at not having to pay anything in. Is the DJTimes available online or is it a mail order subscription? Thanks for the info. - Danjah

The info you seek is best provided by a tax professional. The implications of doing it incorrectly can be more aggravating than a cross country drive with the cd player jammed and incessantly playing Yoko Ono's favorites. Can be costly from a financial perspective as well.

Some DJTimes atricles are available online, not sure if the tax article is. Seek and you may find.

I agree with Rox. This is something that you gotta bite the bullet and get an accountant. My accountant deals with entertainers only and knows the ins & outs well. He directs me where to go and what to stay away from. It's great to get advice from us but you really want to go to someone qualified in the field and also someone you can go back to with questions and/or problems. We're all here to help but each situation can be different enough that you may not be able to use the advice/recommendations for yourself.
Good luck.

For a simple way out, Turbo Tax...

I have a tip I learned from rich folk! cheat however you can and write as much off as possible



And remember....its not what they know its what they can prove



and oh yeah...get an accountant. Any accountant worth a damn will find ways for you to save.

...and a really honest accountant will find you the most legitimate ways to reduce your tax burden. That'd be my advice.



I feel ya Jahaan, the damn rich people don't pay enough of the tax burden. I mean the read this (based on 1999 tax information):



An enormous percentage of taxes are payed by a minority of Americans:

The Top 1% of taxpayers pay 29% of all taxes.

The Top 5% of taxpayers pay 50% of all taxes.

Our tax system is not so much progressive as it is confiscatory. A progressive tax is based on the premise that those with more income can afford to pay more taxes, and conversely, those with little or no income should pay no tax. However, a quick look at the facts shows that the U.S. tax system has become far beyond progressive. Fully half the capable taxpayers contribute almost nothing in individual income taxes.



The Top 1% of income earners (comprising about 1 million families) earn about 15% of the total income earned by all wage earners in the United States, yet they pay almost 30% of all individual income taxes.



Furthermore, the Top 1% are shouldering a roughly 50% higher proportion of the overall income tax burden than they did in 1977.



The argument most oft used against tax breaks are that they benefit only the wealthy. It is clear from even a cursory look at the numbers below that the 'wealthy' will receive the majority of any income tax reduction because they pay a disproportionately huge percentage of the income taxes! To structure a tax break such that those in upper income brackets are excluded would constitute nothing more than transfer of wealth from those who have it to those who don't (i.e. legal plunder.)



Damn rich people!



PS PLEASE NOTE THIS POST IS SIMPLY A RESPONSE TO THE OFFENSIVE, strategically and contextually, SALVO LAUNCHED BY JAHAAN!

I'm not about to go shedding tears for the wealthy. Many become wealthy because of the middle class workers that do the work that brings in that wealth. Also consider the fact that many employers exploit their employees by not providing benefits or laying them off find workers overseas to eploit. I don't think the wealthy have it too bad.

And besides you gotta admit that the phrase "giving tax cuts to the rich" is a simple and effective message. Bush himself even said (assuming Paul O'Neil quoted him correctly) "we're giving more money to rich folk...didn't we already give money to rich folk...shouldn't we put some towards the middle..." I agree that more money should go towards the middle class.

Rox I am a lil jealous of generation after generations of "wealth" I seriously doubt you are in the top 1% or anywhere near it so no need for YOU to feel "offended"....contextually speaking

Eternal,



STFU. Jahaan can read. He's a big boy, he can hold his own ground.



As to your opining about the wealthy, I can only request a roll of toilet paper to properly respond to that worn out nonsense.



Rest assured, I didn't take Jahaan's remark personal. It was just endemic of a mindset that is bothersome. And he is correct, Im not in the top 1%, hell Im probably not in the top 40.



Jahaan,



My economic status, doesn't preclude me from seeing the injustice and unfair burden that the producers and many successful Americans have to shoulder. Nor am I female catholic with desires to serve in a greater capacity in the church but I can certainly see the injustice in not letting women become Priests or Bishops or Popes. I'm not an American of African descent, but I can see and abhor the treatment of such Americans in our history and do what I can to prevent it from happening under my watch.



Despite my selfish desires to live with rigid blinders on, I do see and have opinions about issues that have no direct impact on my family or circumstance.



Eternal's statement is proof that prejudice, in any form, is based on ignorance.



But more on point,



GET A TAX PROFESSIONAL TO GET YOUR TAXES DONE PROPERLY!

I'm just concerned that one day a server somewhere is gonna be low on disk space and somebody is going to say that gab bag is taking up too much damn space. Then they'll probably tell the mods "either you get rid of Rox or we're closing the forum". See. I'm looking out for you Rox

Thank You, eternal. I appreciate you looking out for me. But if I haven't warranted removal by this time, some 3200 posts down the road, I have no fear that increased sensitivity or the desires by my politically motivated and contrary board members will warrant such unwarranted dismissal. But thanks again!



Can you taste the sarcasm, salty huh?



GET A TAX PROFESSIONAL, Dammit!

Turbo Tax is okay if you're taxes are EXTREMELY simple. However, as DJs we constantly make the argument that our clients are better off with the services of a true professional, we should take our own advice. I used Turbo tax for a while. Then, on a family recommendation, I took my taxes to a CPA. I showed her my previous year's tax filing and after she stopped laughing and cleared the tears from her eyes, she said "I can help." She re-file that years taxes and got me a refund of some of the taxes I paid. I've been using her for 4 years now and she's worth every penny I've ever paid her.

A good CPA can write off things you'd never think of AND help you avoid an audit at the same time.

As to your specific question, I do believe that there is a pre-determined dollar amount that the IRS want's you to depreciate as opposed to write off for capital expenses. I think it's anything over $5000, but a CPA can tell you for sure.

Yep Turbo tax is a great for taxes that you probably could do yourself but don't want to. But like Mofo said, you don't get the helpful hints and assistance that you do from an accountant. And I use to use H&R Block til I found myself knowing more answers than them and not getting my questions fully answered.

I hope I'm not getting into an area I shouldn't, but what you really need is Quickbooks. By putting your receipts and income into QB, you can then print out a Profit and Loss Statement that a CPA will use to fill out your taxes. I just took my 2004 QB data file to my accountant yesterday and he doesn't use QB, but another software. But if you have an accountant that does use QB or TurboTax, then what you've been putting into QB will automatically flow into your accountant's QB or TT program. My CPA is a QB ProAdvisor, so he took my data file and loaded it into his copy of QB...then printed out a P&L for 2004 and he just plugged in the numbers into his program right there while I was there. Then he asked about mileage and food costs while traveling to and fro...basically filling in the gaps that I wasn't using Quickbooks for.

So to backtrack...you'd be doing yourself a favor if you could track your business in Quickbooks. Then take that data file or a P&L statement to an accountant/CPA and let them do your taxes. If you want you can use TurboTax (there is even a version for S and C corporations...so it's not "JUST" for the little guy) it's a great program, but I come from an accounting family so I just have my preferences.

Moderators...I'm not trying to sell a product, I just saw where there was a need for a correction between tax filing software and accounting software.