Does Makeup Artistry Counts As Customer Service

Written by: Mary Erickson , CRC Founder and Professional person MUA

Mary Erickson is Not a Certified Public Accountant (CPA). Delight contact a CPA before making whatsoever tax decisions or for detailed questions regarding filing taxes. The information below is not intended as a guide for filing your taxes.

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When it comes to filing taxes as a makeup artist, I hear the following statements from my freelance friends all the time:

"I've never been audited. I don't make plenty money to be noticed."

"I'm a small fry. The IRS doesn't care about me."

And, about common:"I keep all of my receipts so I'chiliad proficient."

All three of those statements are fake. If you lot've never been audited, congratulations. Y'all managed to go lucky. Did you know working as a freelancer or making lower income is one reason yous may be audited? The IRS doesn't exclusively audit the wealthy.

With the COVID-xix pandemic taking a price on our economy and personal finances, the federal regime has extended the tax filing deadline to July 15 without putting you at run a risk of interest or penalties. The typical tax deadline is April 15, so have a moment to celebrate and breathe a sigh of relief.

If you owe money to the IRS, this extension gives you until the July fifteen borderline to make a payment. Then even if you file today, you lot won't say goodbye to that money until whichever scheduled appointment yous cull upward to July 15. This extension automatically applies to all taxpayers; in that location is nothing special you need to do. File equally you normally would.

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Annotation: This extension only applies to federal income taxes. Country income tax varies past state. While virtually states have matched the federal government'due south tax deadline of July 15, others take created their own guidelines. Visit your country or local government website to larn more virtually alternative land tax filing guidelines that may apply to y'all.

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How To File Taxes As A Freelance Makeup Artist

Maybe you lot've never filed taxes as a freelance makeup creative person, or maybe you have but never seem to quite empathize what you're doing. Follow my list of Exercise's and DON'TS to protect yourself from an IRS audit and ensure yous're getting the maximum render or minimum amount owed.

DON'T lie to the IRS! This is the #1 most of import matter you'll read all day.

Real cases go similar this: You're a freelance makeup artist, but you only fiddle in it while living with your friend/roommate. Yous claim $20,000 in income for the year from various freelance jobs because that's what appears on your 1099 forms. Y'all merits $fifteen,000 in expenses with gas, office supplies, phone, etc. And then you lot volition owe taxes on only $5,000 in income for the year.

Now enter the IRS. Your rent is $600 per calendar month. Your car payment is $200 a month. Your expenses (non including nutrient, utilities, etc.) are $800 a month.

Are y'all fix for this question from the IRS:

"How did you pay rent and car payments on $5,000 for the year?"

This is not the time to brand up falsehoods about loans family unit gave you or coin y'all establish in the garage. That won't piece of work. The IRS employs intelligent people who have seen and heard everything. When information technology comes to tax dodging, y'all are not smarter than the IRS. Maybe you can tell them you made it babysitting? That would mean you failed to report income to the IRS, which would be a criminal offence in the USA. If you like your own bed, and steel bars don't appeal to you, do non lie to the IRS.

Exercise keep a mileage log and gas receipts. (The existent receipts, not merely a banking company statement.)

In the result of an inspect, this will make your case a much stronger ane. Mileage is something they almost always look at in an inspect, so don't fudge this. It's not worth the few dollars you may save. Document every address yous go to, if claiming it as travel. There are numerous complimentary apps for this that can help you.

**DON'T say to yourself "I'll worry about an audit if/when the fourth dimension comes."**

That fourth dimension will probably come up 1 mean solar day, and you need to be prepared. Self-employed individuals are a target and for expert reason. It's easier to lie almost pay and expenses when you're cocky-employed.

Practise hire a CPA to handle your taxes.

I know this is expensive, but the few hundred dollars you lot will spend every year can save you thousands of dollars in an audit and a lot of valuable time. The fines for an error, even a pocket-sized one, will pay the CPA fees for years. You tin use Quicken and TurboTax or other tax software, which is cheaper, but research every expense you're taking. Don't assume anything.

DON'T take cash from anyone and presume in that location isn't a newspaper trail.

An audit of your customer who paid in cash for your services can pb to you as the source of his/her expenses. As well, a banking concern deposit of cash tin lead to questions as to where you got the greenbacks. I know it's none of their business organization, but sometimes they make it their business organization.

DO claim dinner out with clients as an expense.

Put the name of the client on the receipt. If you are wining and dining for concern, y'all should get the write-off. If yous're questioned virtually information technology, you lot may be asked for that client'south information.

DON'T write-off makeup you purchase for your personal utilise.

Keep receipts so you can testify the IRS that you do buy makeup for yourself, and you don't write it off.

DO write-off every penny of makeup that you purchase for your kit.

Information technology'due south all a tax write-off. Makeup for your kit is a legitimate business expense for an creative person.

DON'T try to write-off article of clothing, jewelry, hair stylists, plastic surgery or Botox.

I know y'all must await good as a makeup artist, merely the IRS won't buy these expenses. I know, it sucks.

Practice write-off your home role, but simply if there is Nada else that y'all do in that room.

There are two options for filing home office deductions.

1) Simplified Option

This option allows a standard deduction of $five per foursquare human foot of home used exclusively for business organisation. If using this formula, you lot may not calculate more 300 square feet of space, and the maximum deduction is capped at $1,500. To acquire more, read the IRS rules hither.

ii) Regular Method

This option requires y'all to summate the bodily expenses of your home office. These expenses may include mortgage interest, insurance, utilities, repairs and depreciation. Deductions for a home function are based on the percent of your home devoted to business employ. So, if you apply a whole room or part of a room for conducting concern, you need to figure out the percentage of your abode devoted to your business concern activities.

Your room can't double as a invitee room and an office. Take the measurements of the room, and summate its percentage of your dwelling house'due south total square footage. This will be necessary to write-off utilities and rent for that infinite.

Case: If your 10x10 part is 100 sq. ft. and your dwelling is 1000 sq. ft., you can write-off 10% of your hire and utilities.

DON'T use your personal account for concern.

Your business should exist a separate banking concern business relationship. All expenses should get through that account, and all income should be placed into that account.

DO start doing this now if you lot have not been doing this in the past.

The sooner you lot start doing the appropriate things the ameliorate off you will be when you lot are audited.

DON'T decide not to file taxes.

This is a huge mistake! If y'all don't file, the IRS will calculate what you lot owe. In my best Liam Neeson vocalisation: "They will find you, and you will pay."

The first time you get a task that requires your social security number, they will transport a observe to your employer demanding a wage garnishment for by due taxes. I have seen this happen with 3 of my past makeup assistants who failed to claim the income I paid them.

They will chase you down forever, and the amount you owe will grow with fines. Recollect nigh 5 or 10 years down the line when you go to buy a house. They pull upwardly your SSN only to detect a tax lien for by due taxes. A few k in past due taxes can turn into $20,000 with penalties and fines very speedily.

Please make sure to laissez passer forth these tips to a makeup artist you lot know.