Tax Deductions

[Bryan Fowler]

Yes, it's probably juvinile.

Yes, it could be called greedy.

Yes, I dont care, we want a new TV.

 

Being new to this whole... tax thing, i'm wondering what kind of things might be deductable in our industry.

 

I've deducted cable TV in the past, because I get a lot of ideas for production, and shots.

So if the cable is deductable, shouldn't the TV that you watch it on ALSO be deductable?

 

Any ideas?

 

Bryan

Edited November 16, 2005 by bryanfowler

[charlesneufeld]

I am not sure for US tax law, but I think that new tv could be used for playback and review no?

 

 

~C

[Afton Grant]

If the TV is in a true office, 100% of it would be deductible.

 

If it is in a Home Office, I would calculate it much like other home office costs are calculated -- based upon percentages of how much of it is actually used for work, and how much for leisure/living.

 

I'd definitely ask a professional about it though. Better safe than sorry.

 

Best,

Afton

[DavidWest]

I'd definitely ask a professional ..... there, disclaimer applied....

 

you are a video professional...

the format is changing....

 

you must be able to analyze your work in the medium for which it is intended...

 

 

i would be more worried about deducting cable.... :D

[Ari Gertler]

I have a great CPA and we discussed this last year. We both figured that it is not worth the risk. If you take the TV with you to the set to use as a monitor then of course you can write it off. If you have it as the center of your entertainment system forget it, BUT if you use it for editing at home (even cutting a new reel) then it is a toss up on the amount of time it will be used for work, not entertainment. I hope this has helped, I will not see any checks from the Gov. for my German HD TV, or for the gym (yes I tried), but I will be able to write off my Netflix charges and enjoy the great picture on my set.

 

Ari Gertler

[James Puli]

Hey All

 

I have herd people, who have gear stored at home, writing off their "Guard Dogs" and all associated vet bills, food, etc and getting away with it. I supose you'd just have to make the different between "Guard" and "Pets" clear.

 

Dont know how legit it is, but its not too bad for a bit of a laugh otherwise.

 

The other handy one that I know of is that DVD's now, mainly because of extra features, can be written off as "Research and Development". Gotta love those special editions and mulit disc sets.

 

JP

Melbourne Australia

[Brad Grimmett]

Writing stuff off is easy. I can write off every dollar I spend if I want. The real issue is whether it's legal or not. You can lie and pretend you're operating within the law, but if you get audited you could be in very serious trouble. If you can honestly say, "Yes, this is for business purposes", then write it off. If not, then don't. Of course talking to an accountant is a good idea, but you're the only one who knows what you're really using for business and what you're not. It's just a simple matter of honesty.

If people are writing off their guard dogs they're probably going to owe a lot of money to the government when they get caught. I can't imagine the cost of dog food being worth prison time.....but that's just me.

[James Puli]

Hey Grimmett

 

I completly agree with you, I was just stating what I had herd. And according to the source of this information it is as legal as writing off a home alarm system. Without the jail time of course.

 

JP

[Bryan Fowler]

So, in listening to all of you, (thanks for your input) we are not going to try it.

It really wouldn't save us that much i guess. Maybe I was just looking for justification to get rid of our 20inch 4:3 TV that we have had for 5 years. =)

 

I'm making an appointment to visit a Tax Accountant asap.

 

Just wondering...where are we supposed to learn these laws about taxes? I didn't learn about any of this in school, and my parents didn't even know these answers. Like paying taxes quarterly and so on.

 

Again, thanks for the help.

 

Bryan

[James Puli]

I think the education a good accountant gives you is about as good as you can get these days. I have been with my accountant for a fair few years, and was given him as a recomendation of a collegue. Its like looking for a lawyer or a good AC. Once you find the right one you are pretty much set.

 

JP

[Jon Myers]

Well you don't have to write off 100% of it either. If you only use it 30% for work write off 30%. That's completely legal. You can buy anything, and as long as you use it for work then you can write off the percentage that you use it for work.

[Rolfe Klement]

I did loads of jobs for "Enron" and they had a very creative approach to the whole thing. And it was very bad what they did!

 

then I noticed the UK Govt were doing the same thing by 'outsourcing and off-booking' loss making sections like the NHS and Railtrack but using their asset base against loans

 

my 2 cynical 'got burned' cents or pence

 

thanks

 

Rolfe

[Brad Grimmett]

I'm making an appointment to visit a Tax Accountant asap.

 

Bryan

That's a good idea. When I first moved to LA I was using an old friend of mine from Florida, who is a CPA, to prepare my taxes. He did it for me for cheap (basically free) and I thought I was getting a good deal. The problem was that he wasn't familiar with the specifics of this industry, so I was missing a lot of the write-offs that I should have been claiming. I'm now using an accountant who deals pretty much exclusively with people who work in the entertainment business. I pay him more than I paid my friend, but he's opened my eyes to a lot of things that my friend was unaware of, and I get a bigger tax return than I did before, so it's a better deal. So make sure you get someone that is familiar with the business. It makes a huge difference and you'll no longer be uncertain about what you can write off and what you can't. You may actually be able to write off some of that TV, or even your guard dog, but at least you'll be certain that what you're doing is legal before you actually do it.

[Lawrence Karman]

Writing off the cost of a monitor on which you review and or edit any shot footage (wink,wink) or research footage is perfectly reasonable. I would not hesitate to write off at least a percentage of the cost, if not the whole amount. And truthfully you would use it for at least some of this activity. The write off would most likely come in the form of depreciation taken off over 7 years. This may add additional accounting expenses as there are more forms to be filled out.

As I have always understood it you can attempt to deduct anything. The question is if you set off a "red flag" in the computer review of your return and or if you are one of the very few percentage-wise that are audited every year and the IRS disallows the deduction what happens. Most likely is you will have to pay any tax that you avoided with interest and maybe a small penalty. The real problem is when you don't declare income. That is when you could subject yourself to more serious penalties and, depending on the amount, a new roomate named Bubba.

Go for it. Just keep the remote away from your wife. Please consult an acounting professional for more accurate advise, etc.....

[DavidWest]

lkarman <--------- brings up a great point.... all you have to do is explain to your wife that you are the ONLY one allowed to use the remote or else you cant deduct it... i think i need one now considering that....