How The New Tax Bill Affects Freelancers

It’s 2018, and you are likely starting to think about your taxes. You may also be wondering what’s in the newly passed tax legislation (officially the “Tax Cuts and Jobs Act” or TCJA) and how it’s going to affect you. Here is some help, specifically targeted for freelancers and creative economy workers.

To be clear, the 2017 taxes you file in the next few months will be based on the rules you already know. In other words, the old tax laws apply to the 2017 taxes you will file this year. The TCJA applies to 2018 and beyond, so this is for your planning for the coming year.

When you file your 2018 taxes (next year), most people will get an initial tax cut (that will expire in 2026), but the wealthy get most of the benefit. People in high-tax and high cost of living areas and those with kids may see their taxes rise. New York City artists with children, this means you. There are a lot of nuts and bolts reasons for this, which is what the bulk of this article is designed to address, but it’s worth spelling out the rationale for these changes. Your taxes may go up because Republicans are targeting blue states in an attempt to force us to cut our spending. They are giving a large, permanent tax cut to corporations, and the majority of individual tax breaks to the top 1%. This cues up a big deficit that they will later point to when they try to cut social spending. By delaying talk of spending cuts, they hope we will all forget who created this deficit and why.

The Tax Cuts and Jobs Act is the biggest piece of tax legislation passed since 1986...Read more

Why Mid-Tier Galleries Leave New York

As an artist who moved out of New York City, I’m not alone in finding new energy, inspiration and freedom. My move was from Brooklyn to Asheville, North Carolina. But when I noticed multiple long-established New York galleries also making such moves, it surprised me. Don’t galleries have to stay close to collectors?

According to four dealers I spoke to who had moved out of the city, the cost of operating a gallery in New York City was a major factor for everyone, though lifestyle was also a factor. Says Monya Rowe, of Monya Rowe Gallery “Sadly, NYC is killing itself with all the rent hikes.” Rowe ran a gallery in Williamsburg, Chelsea and the Lower East Side for 12 years before she relocated to St. Augustine Florida in 2015.

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Business and Personal Accounts: Keep ’em Separated

There are a million meaningful reasons to operate an arts business, from creating revelatory art experiences for the public, to a commitment to a tradition, to the love of making hand-crafted objects. But at the end of the day, if it is a business (and not, say, a non-profit), a major purpose is to make money to pay for the expenses of living. And if the purpose of the businesses’ earnings is to pay for our personal expenses, why then is it so important to keep the business financial transactions separate from our personal ones?

The reasons are simple. It protects you from tax trouble and legal trouble. And it’s the law.

Here is an example to illustrate the tax trouble scenario. 

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The Personal Finance Attitude Adjustment

In my last post, I outlined the basics of a personal finance plan. That article is the “what to do” where I answer questions about insurance, debt management, savings and investments. If you haven’t read it I suggest spending a bit of time with the post because it provides the foundation for getting your proverbial ducks in a row. This week, I’d like to get into the “how to do it” part.

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A Personal Finance Cheat Sheet for the Overwhelmed

Money is the most powerful metaphor we have. For many people it represents their self-worth, their standing, their power and their security. In many ways artists are a little different—we have a life where we choose to value different things than the rest of society – freedom, both artistic and from societal norms, as well as intellectual independence. Our very existence can be seen as a challenge to capitalism. It’s why some people feel threatened by us—our choice to place a high value on things other than money might call into question their own choices and values.

So I understand why many artists may want to or feel as though they live outside the “regular” financial system. However, we all still must function within it. I have seen too many artists succumb to their own lack of financial knowledge and security – by giving up art, making outsized financial sacrifices (like homeownership, children, or secure retirement), and even becoming destitute. Money can be very emotional: not knowing how to manage it can make us feel out of control, anxious, overwhelmed, and ashamed.

But the flipside is wonderful. Taking some basic steps to control your money is empowering. It can prolong your career, help you meet personal and professional goals, and set your mind at ease.

I’d like to outline the most basic ideas of personal finance. There are tomes written on each single line below, and a million variations. But since feeling overwhelmed can cause paralysis, I want to assure you that the very basics of solid personal finance are universal.* Here they are.  Read more...