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 So
you wanna attend DJ Times’ DJ Expo West? Scheduled
for March 6-8 at San Francisco’s Cathedral Hill Hotel, the
trade show should be a big help to you – but what if your
budget won’t cooperate? Worry not, because Uncle Sam is
willing to assume a sizable portion of your expenses.
As you know, tax deductions legitimately reduce the business
income upon which your tax bill is based. But did you know
that the U.S. Government wants you to go to the DJ Expo?
Think of it this way: The Government, in many ways, operates
as a silent partner in your DJ business. Just like you,
our bureaucrats wish for your bottom line to bulge, too,
simply because that will cushion their coffers, expand the
revenue base and help pay off our Goliath-sized national
debt. Therefore, all the “ordinary and necessary” business
expenses that help achieve this – and convention attendance
is just one of them – qualify as allowable deductions. (In
reality, the agenda of the convention does not have to deal
specifically with your DJ business. It is enough that you
can reasonably expect to gain some business benefit from
attending the event.)
To
get the green light on these tax deductions, you only need
to prove two things to the I.R.S. – if they ask. First,
you must show income through your DJ business (in other
words, you can’t be a DJ hobbyist and expect deductions).
And second, your attendance at the DJ Expo must benefit
your business. Sound simple? Well, it is. According to the
I.R.S., a benefit to your business occurs through networking,
researching new equipment and marketing techniques, even
learning new dances or promotional strategies. If that doesn’t
describe the International DJ Expo, then what does?
While
deciding whether to attend the DJ Expo West – and we, of
course, being biased, think you should – take a peek at
some of these tax deductions that Uncle Sam will allow.
When it’s tax deductible, we think the skies are friendlier,
the meals are tastier, and your slumber is somehow more
peaceful.
Planes, Trains & Automobiles:
In John Hughes’ 1987 comedy, do you think an urbane advertising
executive (Steve Martin) and a bumbling shower-ring salesman
(John Candy) deducted their travel expenses for their Thanksgiving
visits home to Chicago? Well, no, it was a holiday vacation,
but if they had scheduled their trips during a convention…you
bet. Deductible travel expenses include all costs of transport
between your home and the convention site – be it by plane,
train, bus or car.
Once
you’ve arrived at the airport, then you can add to your
deductions the cost of a cab or airport limousine, too.
Car deductions are computed by miles driven, or as direct
auto expenses with only the business portion tax deductible.
This goes for both ends of the trip. Oh yeah, in the eyes
of the I.R.S, hiring a stretch limousine may be a tad extravagant
– and if you’re thinking of going via rickshaw, well, then
you’re definitely getting carried away.
Baggage Claim:
We’ve all had a little excess baggage we’d like to check.
Maybe some tuxedos or outfits that your employees will be
using for a showcase at the show? Whatever it is, if carry-on
just won’t cut it, these types of shipping costs are tax-deductible.
However, the money you throw down at the show for a new
dual CD player or mixer is not tax deductible. It is, however,
depreciable. The shipping home of such equipment must be
added to the cost figure before depreciation is computed.
Sleep-Aid:
W.C. Fields once said that the best cure for insomnia is
to get plenty of sleep. But we think an even better cure
is to enjoy repose that is tax-deductible. Not only is your
hotel room at the Expo a deduction, so is any lodging that
may be required while you’re en route to the show. That
is to say, if you are away from home overnight or long enough
that you need to stop for sleep in order to properly perform
your duties. So forget counting sheep, count your deductions
instead.
That’s
One Happy Meal:
Go ahead, order that French dessert that you can’t pronounce.
While attending the Expo, your meal deductions include the
amount spent on food, beverages, tips and tax. Unfortunately,
the tax deduction for meals is limited to only 50-percent
of the amount you actually spend. This, the “actual cost
method,” requires that some semblance of records be kept,
although receipts are not necessary for smaller amounts.
Generally, receipts are not required for amounts less than
$75.
An
alternative to the actual cost method is the “standard meal
allowance,” also known as the M&IE (meals and incidental
expenses rate). This allows you to deduct a set amount for
meals and does not require that you keep records of your
actual costs. Although the actual amount of the deduction
is taken from tables provided by the I.R.S., you must still
prove – through adequate records or sufficient corroborative
evidence – the time, place and business purpose of the meal.
Last year, the standard meal allowance in most American
cities varied between $32 and $40 per day. Other locations
in the U.S. are designated as high-cost areas, qualifying
for higher standard meal allowances. San Francisco is one
such high-cost destination, and if you choose the M&IE allowance,
you must look up the final figure in the I.R.S. tables.
Last year, maximum per-diem rate, including lodging, varied
between $113 and $181 per day.
The
standard meal allowance or any other travel expense is taken
on various forms, depending on who pays the expense. An
employee (even an employee of his or her own business) uses
Form 2106 (Employee Business Expenses). If you’re self-employed,
then add the expenses under travel and entertainment, or
as a miscellaneous expense on Schedule C.
Reach
Out and Touch Someone:
The only thing more annoying than a person blabbing away
on a cell phone during an Expo seminar is the fact that
they’re getting a tax deduction while they’re doing it.
At times like that they should be charged double. Still,
you can use this to your advantage. All business-related
dialing during the Expo – be it to your office and, in some
cases, even personal calls – are tax deductions. No, Sports
Phone is not a deduction.
Bring
the Ball and Chain:
If your spouse accompanies you to the convention, ordinarily
you can’t deduct their travel expenses. The travel expenses
for any accompanying individual are deductible only if that
individual is your employee, has a bona-fide business purpose
for the trip, or would otherwise be allowed to deduct the
convention expenses. In order for a bona fide business purpose
to exist, the DJ operation must prove a real business purpose
for the individual’s presence. Incidental services, such
as typing notes or assisting in entertaining customers,
are no longer adequate. They must – again, if the I.R.S.
checks – be “employed” by the business (even part-time)
and perform a meaningful service to the business in exchange
for wages comparable to those that would be paid to a non-family
member for similar services.
Vacation,
All I Ever Wanted:
What if you decide to combine your Expo attendance with
a vacation? If your trip is “primarily” for business and,
while at the convention, you extend your stay for a vacation,
made a non-business side trip or had other non-business
activities, you can still deduct your business-related travel
expenses, including the cost of traveling to and from the
convention and any business-related expenses while you’re
there.
If, however, your trip is primarily for personal reasons,
such as a vacation, the entire cost is a nondeductible personal
expense. Naturally, you can deduct any expenses you have
while at your destination that are directly related to attendance
at the Expo.
By
now it should be evident that every DJ can write-off or
deduct the expenses of attending the DJ Expo West – as if
an assortment of unparalleled seminars and a stuffed exhibit
hall weren’t enough. Remember, though, that the I.R.S. can
challenge both the amount and the category (business or
personal) of any expense.
How else can we shamelessly convince you that attending
the International DJ Expo West – sponsored by DJ Times and
its publisher, Testa Communications – in San Francisco from
March 6-8 is a great business move? Let us know how at djtimes@testa.com
and we’ll print your response.
If
you have any questions for TCB, please write to
DJ
Times c/o TCB,
25 Willowdale Ave.
Port Washington, N.Y., 11050
fax 516-944-8372
e-mail djtimes@-testa.com.
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