My friend, we as photographers have a TON of expenses! If you know anything about the cost of doing business, then you know it is not uncommon for a photographer's yearly expenses to be anywhere from 5, 10, or even 20-plus thousand! But the good news is, Federal tax law allows you to claim many of your business costs on your annual tax return!
Why Should Photographers Take Advantage of Tax Deductions in Their Business?
Federal tax law allows you to deduct several different business expenses from your taxable income each year, so you as a photographer can benefit from claiming these costs on annual tax returns! This is because claiming these expenses reduces your taxable income and therefore, reduces the amount of money you will pay in taxes. That's why keeping track of business expenses is a crucial part of tax preparation! No matter if you're a brand-new photographer or a seasoned pro, it's important to take steps to improve your bottom line so you can ensure a sustainable business that will be here for the long-term.
How to Prepare to Claim Tax Deductions For Tax Season
If you want to maximize your opportunity for tax deductions, it's best to track your expenses throughout the year and maintain organized records. It can be very stressful trying to put everything together the last minute during tax season! Keep a log, save your receipts, and be sure to pay for all expenses with your business account's checks, debit, or credit card to create a paper trail that documents your expenses.
Top 5 Deductions for Photographers
There are many expenses you should be sure to document as a deduction. Here are the 5 most common deductions you should absolutely never forget!
1. Operating Expenses - Marketing materials, software and programs, data storage; all the things you need to make your business operate are absolutes to document as deductions!
2. Gear - Photographers pay THOUSANDS in equipment from camera bodies, lenses, and flashes to memory cards. Keep all documentation for these purchases!
3. Cost of Goods - Any fees you pay to acquire prints, albums and other products for your clients are considered tax deductions!
4. Professional Expenses - Legal, accounting, and continuing education fees are typical business expenses for photographers. Be sure to count these!
5. Travel Expenses- All that mileage you spend going back and forth to sessions, weddings? You can claim up to $0.58/mile!
Want to Know More?
There are SO many more expenses you should be sure to document for your taxes. Check out my YouTube video for a comprehensive list of important deductions to consider! TAX DEDUCTIONS FOR PHOTOGRAPHERS