Taxes: Are You Being Double-Taxed
On Voice-Over Income? It Happens ...
By Kristin Delfau, EA
Delfau Tax & Financial Services
As a voice-over artist, one of the more aggravating, least interesting parts of your job is probably keeping track of your various income sources for your tax return each year.
But I will let you in on a little secret: it is really important that you do, so that you don’t pay too much to the IRS each year.
Whether you “Talk to the Box” (as in boxed tax software) to complete your tax return or use a tax professional, making sure you report your income correctly can save you from being double-taxed.
Of course, you probably already know that you are supposed to report all of your income.
Sometimes you’ll hear, “Well, I made less than $600 on that job, and the company isn’t sending me a Form 1099, so I don’t have to report it.”
Unfortunately, that’s not true!
If you make less than $600 for work you’ve done for a particular company, it only means that they don’t have to send the IRS proof of it. But according to the IRS, you are supposed to report it.
As a tax professional preparing returns, here’s an even bigger reason that you want to keep track of who is paying you: you may have the situation where your income is accidentally reported twice. This means you are paying more tax than you are supposed to!
How can that happen?
As a voice-over professional, working for a bunch of different companies can make you particularly at risk to reporting the same income more than once.
It often happens that a Form W-2 or a Form 1099 may come from a different company than the organization’s name that appeared on the check you received.
For example: You are hired by XYZ Productions to provide a voice-over, and they pay you with a check from XYZ.
However, when tax time comes, you receive a 1099 from Broadspace Media (the parent company of XYZ) and you count both the check and the 1099 as income.
Now you are paying tax twice on the same money!
AVOID THE TRAP
How can you prevent this?
The easiest way is to keep track of your income in a spreadsheet program like Excel or QuickBooks.
If you are not comfortable with such software, then keep a notebook instead. Simply list the date of service, how much you were paid, and who paid you.
That way, when tax time comes, you can check your Form 1099s against your records and make sure you aren’t double reporting.
Next time, I’ll give you some tips on some tax deductions you should be taking!
ABOUT KRISTIN ...
Kristin Delfau is the president of Delfau Tax & Financial Services in Danbury, CT and the author of Turbo-Mom’s Guide to Saving Money Without Wasting Time. She specializes in flat fee tax preparation and life insurance solutions for individuals. She received a B.A. from Rollins College, an M.A. from the University of Westminster and is a Fulbright scholar. A member of the National Association of Tax Professionals (NATP) as well as the NY/CT Association of Tax Professionals, she also speaks fluent French.