Producing art for sale is a business enterprise. Producing art for the pure pleasure of creating with no intent or plan for the sale of what you are creating is not considered a business enterprise. If you intend to market and sell the product you make you are entitled to all the benefits of being in business. But, if you are not really serious about generating income from your creative efforts, you are considered by the I.R.S. and the art world to be a hobbyist. A hobbyist is not entitled to business tax benefits.

Here are the basics “Benefit and Tax Deductions” of which you need to be aware:

Education
Anything related to furthering your skills and your craft are fully tax deductible – workshops, college or university courses, seminars, etc.

Promotional Materials
Includes all printed items such as brochures, stationary, mailing costs, slides, photographs and your website.

Travel
When you travel be sure to keep a record of all your travel expenses. They are fully tax deductible if they are business related. Most travel expenses such as auto and airline are deductible when you are presenting your work to galleries, collectors, and consultants, etc. When you travel take business cards with you. Contact galleries on your trips. Give them your card and get theirs.

Art Supplies
Paint, paintbrushes, canvas, paper and all materials used to create your product.

Your Studio
Your studio may be fully or partially deductible. If your studio is in your home you can deduct a portion. If it is a stand alone, take a full deduction including utilities, telephone, etc.

Entertainment
Related to your art business can be fully or partially deducted.

Record Keeping
Record all of your expenses by keeping receipts, a diary and notations in your checkbook.

Copyrights
All that is required to protect your original work is the placement of a “C” in a prominent place in the lower portion of your image with the year of completion and your signature.

Legal-Contracts
Contracts are usually designed and written by attorneys in legal language. Most people find contracts difficult to understand, especially, the fine print and terminology.

If you receive a contract from a gallery, print publisher or art agent, be sure you fully understand everything the contract means. Have an attorney review the contract so that you will be sure to understand and agree to all terms and conditions.

Your Social Security Account
As a self-employed business person the first portion of any federal taxes you pay will go directly into your social security account.

Joint Filing
If you are married and your spouse is employed by a company that automatically deducts taxes from his/her salary, you are entitled to deduct all of your business expenses from your joint tax liability.

Your Accountant
I have given you the basic tax and business benefits and deductions you can be entitled to, but you should consult with your accountant to verify your own legitimate deductions. It is important to understand that most businesses do not show a profit for the first three years. Business losses are part of doing business, but losses are deductible.

Budget
It is also extremely important that you establish a yearly advertising and promotional budget for your art business. At least 10% of all your sales should be set aside for this purpose.

You have heard the saying, “…that it takes money to make money.” This is so true. All businesses require capital (money) to get started and remain operational. As an artist your investment will be smaller than that required by most other kinds of business enterprises. Nevertheless, you must be fully committed financially to your business if it is to succeed.

Successful artists must have a passion for what they create. However, it is necessary to take care of or, at least, oversee the successfully marketing of your work. Again, remember that you can hire help for some of those business tasks. That’s what consultants and agents are for. Organize your budget to free yourself up to do what you do best…create art.

Arnold White has been a publisher and distributor of fine art prints for over 20 years. He is the President of Winner’s Circle Gallery, a firm that represents artists seeking to enter the print market. Mr. White serves as a consultant and reviews work from artists wanting to enter this market. You may contact Mr. White at Winner’s Circle Dept. AB, P.O. Box 4814, Palm Springs, CA 92263 or call (800) 748-6400. More on selling your artwork at: http://www.framehousegallery.com/WinnersCircleGallery/index.html Comments or questions can be sent directly to Arnold White swhite@DC.RR.com

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