From the category archives:

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Summer Camp: A Break For Taxes and Parental Sanity

by Hannah Cole on July 25, 2017
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I’m taking a brief summertime break from my AFC column in order to direct the summer programming at “camp mom.” I will be back in the new season with more tips and advice on taxes and personal finance for creative economy workers. In the meantime, in honor of all the AFC working artist parents out there, here’s a post on the tax credit that applies to summer camp.

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Why Mid-Tier Galleries Leave New York

by Hannah Cole on July 10, 2017
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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?

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Business and Personal Accounts: Keep ’em Separated

by Hannah Cole on June 13, 2017
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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.

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The Personal Finance Attitude Adjustment

by Hannah Cole on June 2, 2017
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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. This part is about the mindset to get yourself on track. There are a lot of general principles for good financial health but what I outline below are the most time-tested. Since what I’m talking about this week is more about attitude, this is the part where you make adjustments and decide for yourself what works best for you.

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A Personal Finance Cheat Sheet for the Overwhelmed

by Hannah Cole on May 18, 2017
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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.

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The Estate Tax: An Economic Justice No-Brainer

by Hannah Cole on May 2, 2017
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Economic inequality is one of our biggest problems as a society, and it’s ruining our health. But it’s hard to write headlines about something that gets incrementally worse every day, instead of making a dramatic, newsworthy entrance. Bernie Sander’s campaign struck a chord by focusing on income inequality, and Trump garnered popularity by addressing workers on the losing end of the economy (though, I would argue, not with actual solutions).

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Set up For Your Best Year Ever: A Tax Day How-To

by Hannah Cole on April 18, 2017
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Here we are at Tax Day. Your taxes are filed. (They aren’t? Here’s an IRS extension form – postmark it today. You’ll need one for your state, too.)

Last year you vowed to get your stuff in order. Then suddenly the tax deadline was upon you, and you scrambled through the process, and weren’t as careful as you intended to be. You suspected you should have been paying estimated quarterly taxes all year, but didn’t, and now your tax bill is surprisingly high.

Now that the time pressure is off, let’s take a look at how you can make this year better. Plus some discounts on apps that can help you.

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Charitable Deductions for You, Me and Warren Buffet

by Hannah Cole on April 4, 2017
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What’s the difference between standard and itemized tax deductions? An Itemized tax deduction is what rich people use to write-off their charitable giving. And, maybe, you could too.

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Some Real Numbers for Artists on the ACA Repeal

by Hannah Cole on March 22, 2017
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When I went back to school for accounting, I never thought I’d get an education in healthcare. But the Affordable Care Act (ACA, aka Obamacare) forced tax preparers like me into learning about our healthcare system, because most of the credits and penalties are reconciled on the tax return.

Given this background, I have some insights on what the new Republican proposal, the “American Health Care Act” (ACHA, aka Trumpcare) would do to you, me, and our federal budget. It’s not good.

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The SEP IRA: A Lovesong

by Hannah Cole on March 8, 2017
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We freelancers pay a lot of tax. We don’t just pay an income tax rate of anywhere from 0 to 39% on our freelance income – we also pay a flat 15.3% self-employment tax, no matter what our income bracket. Without tax planning, this can be a huge bite.

As artists and cultural workers, our freelancer tax strategy is generally to reduce the amount of our taxable self-employment income as much as legally possible. Tax planning is hard, because it’s about saving small bits in many places. There are few silver bullets.

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