35 Tax Write-Offs for DJs & Music Producers

If you're self-employed as a DJ or music producer, tax deductions (a.k.a “write offs”) will help you pay less tax. This article lists common tax deductions for DJs and music producers. Use it when filing your tax return to keep more of your music business income in your bank account.

How taxes work - read this first

Before taking deductions, you should understand how taxes work.

What are tax write offs?

As a musician, you probably have numerous income streams - gigs, royalties, lessons, etc. All of this income must be reported on your tax return.

Whatever you do to make money, it probably involves buying things like equipment, software, marketing, and other items. In the tax world, these expenses are called “write-offs” or “deductions.”

You report these deductions on your tax return as a subtraction from your income, helping you pay less tax.

However, not all expenses are deductible.

To be deductible, an expense must be “ordinary” and “necessary” to your business. Ordinary means common to the industry and necessary means required in order to conduct business. You (generally) can’t take a deduction for personal expenses, such as groceries or pet supplies.

Who can take tax write offs?

You must be self-employed in order to take tax write offs for your music business. This means that you’re a DJ, producer, or other music industry professional and have the intention of being profitable or you conduct yourself in a business-like manner.

If you make music as a hobby, you can’t take deductions but you must still report your income. Refer to the IRS guidelines to determine whether you’re a hobbyist or self-employed.

How do you take write-offs?

Once a year - typically before April 15th - you’ll file a tax return. This tax return is called Form 1040. The state where you live probably has a tax return too.

On Form 1040 you’ll report all your income, deductions, credits, and other tax information on the tax return. As a self-employed individual, you’ll report your music business income and deductible expenses on Schedule C of Form 1040.

Once you’ve filed a tax return, you’ll settle up your tax bill by paying additional tax owed or receiving a tax refund if you overpaid. You can file a tax return by filling out the forms by hand and mailing them (not recommended), using tax filing software, or hiring a tax professional.

Why take tax write offs?

Income - Deductions = Taxable Income

Removing deductions from this equation will cause your taxable income to be higher. This means you’ll pay more tax. If you’re looking to minimize your tax burden, it’s important to take each and every deduction you’re entitled to take.

By paying less tax you keep more of your music business income - an ideal outcome. You can reinvest the savings back into your music business, save for retirement, or use them for whatever else.

Common tax write-offs for DJs & producers

Here’s a list of tax deductions you might take as a DJ or music producer.

Keep in mind, though, that no one understands your music business better than you do. There are probably deductions not on this list that apply to you. Some of these may not be deductible for you, depending on the facts and circumstances of your situation.

When taking deductions, use good judgment and be prepared to substantiate your deductions in case the IRS ever asks about them.

Apps & software

Software used in your music business is deductible. This could include music production software or software you use while performing or streaming live. You might also use administrative software that’s not music related.

DJ software: TRAKTOR PRO, Virtual DJ, rekordbox, etc.
Digital Audio Workstation (“DAW”) software: Ableton Live, Audacity, Logic Pro, etc.
Music distribution software: DistroKid, SoundCloud, CD Baby, etc.
Streaming software: StreamLabs, OBS Studio, XSplit, etc.
VJ software: Resolume, Visualz, Synesthesia, etc.
Administrative software: Trello, Microsoft Office, Google Workspace, etc.

Music production costs

As a DJ or producer, you can deduct the cost of any music, sample, or other audio file that you use to produce a track or in a live set. These might include such as:

Music costs: iTunes, Amazon, Traxsource, etc.
Sample packs: Beatport, Bandcamp, Juno Download, etc.
VST plugins & libraries: Kontakt, Spitfire Labs Massive X, etc.
Mastering services: Landr, eMastered, Ozone, etc.

Event expenses

The cost of events, shows, and parties that you organize or attend are deductible to the extent they’re connected to your music business. Expenses for these events might include:

Venue deposits and fees;
Equipment rentals;
Event staff;
Decorations, lighting, & supplies;
Security, safety, & harm reduction;
Print or digital advertising;
Event insurance; and/or
Licenses & permits.

Event expenses can also include food & beverages for attendees; however if the event isn’t related to your music business, then these expenses would be personal and not deductible.

Merchandise for resale

If you sell merch online or in-person, the merch and associated costs are deductible. Deductible merch costs include:

Printing costs: Printify, Printful, Spreadshirt, RedBubble etc.
Shipping and postage: USPS, FedEx, Shippo, Stamps.com, etc.
Third-party fulfillment: ShipHero, ShipBob, ShipMonk, etc
Online marketplace fees: Shopify, Amazon, StreamElements etc.

Merch you buy from other DJs, musicians, or labels isn’t deductible. There are exceptions but these purchases would typically be personal and therefore non-deductible.

Marketing & promotional expenses

You can deduct the cost of marketing and promotional materials that grow your audience or professional network. It also includes art you use on your website or social media platforms to promote yourself as an artist or DJ.

Website: domain registration, hosting, page templates, etc.
Social media: advertisements, influencer partnerships, brand collaborations, etc.
Promotional: playlist placements, sponsored content, electronic press kits, etc.
Print: stickers, posters, flyers, etc.
Branding: logos, album art, photography, etc.

Commissions & fees

Payments to people who facilitate the distribution of your music, whether that’s live or through recordings, are deductible for tax purposes. Here are examples of commissions and fees that you could deduct:

Management fees paid to a manager;
Royalty or profit splits paid to collaborators;
Booking commissions paid to agents;
Distribution fees paid to record labels;
Clearance fees and royalties paid to other artists;

Contractors

You might outsource aspects of music production, promotion, and performances to other people. Unless they’re employed by you, these individuals are known as independent contractors. The cost of hiring contractors for your music business is tax deductible. Contractors you might hire include:

Mixing and mastering engineers;
Audio & recording engineers;
Session musicians & vocalists;
Songwriters & music arrangers;
Graphic designers, photographers, & videographers.

TIP: You should obtain a completed Form W-9 from your independent contractors to determine their tax status. Based on their W-9 information, you might need to Form 1099-NEC for them in January if you paid them more than $600 during the year.

Legal & professional fees

You might pay someone to file your taxes, advise you on legal matters, or help you grow an audience. These professional services, and others, are deductible to the extent they support your music business.

Accounting: bookkeepers, tax preparers, business managers, etc.
Legal: entity formation, intellectual property, registered agent, etc.
Consulting: marketing, coaches, technical, etc.

Processing fees

Do you use Stripe, PayPal, Cash App, Venmo, or other apps to send or receive money? If so, you’re probably all too familiar with the fees associated with these apps. These fees are deductible.

If you received a certain amount of payments through these apps, you may have been issued a Form 1099-K. This tax form reports the “gross” amount you received through the app before processing fees were deducted.

In other words, the 1099-K shows how money you were sent, not how much you were paid out. If you’re relying on the 1099-K to file your taxes, you should deduct the processing fees to avoid overpaying your taxes.

Bank charges

Aside from processing fees, your bank might also charge you fees for various transactions. Fees associated with business transactions, such as the following, are fully deductible.

Wire or transfer fees
NSF fees
Analysis fees
Maintenance fees

Professional development

The costs of developing your skills as a musician and/or business owner are deductible. These costs include:

Lessons and tutorials from a coach, instructor, or mentor;
Online communities where you learn from other musicians;
Books & audiobooks that help you become a better DJ or producer;
Professional association & union dues for music industry professionals;
Other learning resource that help you be a better business owner;

Deductible professional development expenses don’t include school tuition or education supplies. Deductible education must be work-related. The education expenses can’t qualify you for a new line of work. You must have a preexisting music business in order to deduct professional development expenses related to the music industry.

Meetings, conferences, & webinars

The costs of networking in-person or virtually are deductible.These costs include registration fees, travel, meals, supplies, and other costs associated with a networking event.

However, expenses such as tickets or cover charges to a show aren’t deductible even if you place to network there. These are non-deductible entertainment expenses. To be deductible, the event must be organized strictly for networking and not for entertainment.

Licenses, permits & registration fees

The cost of forming an LLC for your music business is deductible. Registering a trade name or DBA is also a deductible cost. You’d typically pay these registration fees to your resident state’s Secretary of State. Some states administer DBAs at the county level and require you to publish the name in a newspaper (also deductible).

The city, town, or county where you live may also require you to obtain a business license and permit for your production studio–even if it’s at your home. Business licenses and permits are deductible expenses.

Business insurance

The cost of business insurance is deductible on your tax return. Here are some insurance policies you might have as a music industry professional:

Instrument & equipment insurance
Event insurance
Travel insurance
General liability insurance
Home or commercial property insurance

Insuring your music business is often a good idea - especially when lots of money is at stake. For example, music production equipment is expensive and your livelihood depends on it. By having equipment insurance, you can afford to replace the equipment if it’s ever stolen.

Health insurance

Health insurance coverage for you and your family is a deductible business expense if certain rules are followed. This deduction is called the Self-Employed Health Insurance deduction. It allows self-employed individuals to subtract the cost of health insurance premiums from their business income to lower their tax liability. Other medical expenses, such as doctor visits, typically aren’t deductible as a business expense.

Travel expenses

Work-related travel expenses are deductible. The extent to which they’re deductible depends on how the nature of your travel:

Trip is 100% business related - Travel expenses are 100% deductible.
Trip is mostly business related - Expenses for travel to and from the destination are deductible but expenses related to personal travel aren’t deductible (e.g. tickets to shows, side trips, etc.)
Trip is mostly for personal enjoyment - Your travel expenses aren’t deductible but you can deduct expenses directly associated with your business (e.g. meals, meeting rooms, etc.)

Deductible travel must include a destination that’s beyond the geographic area in which you live. To be deductible, the travel must be long enough to require you to sleep or rest while traveling.

You can’t deduct travel for which you received a travel buyout or stipend. You should reduce your deduction by the amount of any reimbursement you received from promoters or event organizers.

The costs of short trips, such as driving across town, are also deductible. Because the trips aren’t “business travel” you can only deduct the transportation cost. This means that meals from a restaurant near your destination wouldn’t be deductible (unless, of course, those meals had a business purpose).

Refer to IRS Pub. 463 for more information on travel deductions.

Transportation

The cost of transportation to and from your work-related destination is deductible. Examples of deductible travel include:

Tolls
Parking
Rental cars & fuel for rental cars
Taxis, shuttles, & trains

You can also deduct the costs of driving to a destination in a vehicle that you own. Refer to the “personal vehicle” section above.

Hotels & lodging

The cost of staying at hotels, motels, mountain lodges, and other hospitality venues are deductible if the associated travel is work-related.

The IRS has unique documentation requirements for hotels & lodging. You must have a detailed receipt for all lodging expenses regardless of amount. This is unlike other deductions, where documentation is required only if the deduction is greater than $75.

Your hotel receipts must include the following information, at a minimum:

Hotel name
Hotel address
Dates of stay and departure
Meal, room, and incidentals listed separately

Travel meals

Meals eaten while traveling away from home are deductible, under certain conditions.

Your work-related travel must take you far enough from home that sleep or rest is necessary. This means that taking the train across town would be an insufficient length to deduct the meal you ate while out (unless it was for a business meeting).

Meals

The cost of business meals is deductible (including taxes & tips). You or an employee must have actually attended the meal for it to be deductible. The meal can’t be “lavish” or “extravagant.” Deductible business meals include:

Meals eaten while traveling for business;
Meals eaten at a convention;
Meals eaten with business “associates.”

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The IRS imposes stringent recordkeeping requirements for deductible business meals. You need a receipt or other document showing where you ate, when you ate, how much you paid, who attended, and what topics were discussed.

Typically, only 50% of your business-related meal expenses are deductible. If the meals are accompanied by entertainment, the entertainment portion is not deductible. The cost of traveling to and from the meal is generally deductible.

Personal vehicle

A portion of your personal car, truck, van or other vehicle costs are deductible in your music business. This deduction will be rare if you mostly work from home. On the other hand you’ll benefit from this deduction if you’re driving to and from gigs or to meet a co-producer at another studio.

The amount you can deduct varies. You can’t deduct your car payment but you can deduct a portion of the interest or business mileage. You’ll calculate the deduction using one of two methods:

Standard mileage rate
Actual vehicle expenses

Regardless of the method, you must maintain a “contemporaneous” mileage log. In other words, you must log your trips in a spreadsheet, app, notebook, or other tracker at the time of the trip. The IRS doesn’t allow you to make estimates or rely on guesses after the fact.

For each trip, you should document the date, origin, destination, mileage, and business purpose. Using mileage tracking software to automatically record your mileage via GPS will streamline this requirement.

Standard mileage rate

The IRS sets the standard mileage rate annually. In this method you multiply the mileage rate by the amount of miles you drove for business reasons. You then deduct the mileage on your tax return to offset your business income.

Actual vehicle expenses

Instead of deducting mileage, you can deduct the actual costs of operating your vehicle. This involves tracking your expenses and deducting the business portion. You calculate the business portion by dividing your business mileage by the vehicle’s total mileage. You then multiply the percentage by the sum of actual expenses, including costs for:

Fuel
Depreciation
Auto insurance
Auto loan interest
License and registration
Vehicle repairs & maintenance

Home office & studio expenses

Is there an area of your home dedicated to your music business? If so, you can deduct expenses associated with this space. This deduction is called the Business Use of Home Deduction - also known as the home office deduction.

The home office deduction is great because it allows you to deduct expenses that you’re already paying for, such as rent or utilities. Your home office must meet certain rules and you can typically only deduct a portion of the associated expenses.

The home office rules stipulate that your office or studio space must be “regularly” and exclusively” used in your business. In other words, there must be an area of your home that’s used only for the purposes of producing music, doing administrative work, or other business activities. You can only deduct expenses associated directly or indirectly related to that space.

For example, occasionally working in your kitchen wouldn’t make your kitchen a home office because you’re not consistently working there (i.e. it’s not “regularly” used) and you use the kitchen for other purposes such as making food (i.e. it’s not “exclusively” used).

However, your kitchen would be a home office if, for whatever reason, you’ve carved out a dedicated space in it for music production. This is just one example, so use your judgment in making this determination based on your particular facts and circumstances.

The home office deduction has two categories of expenses:

Indirect expenses; and
Direct expenses.

Indirect expenses apply to your entire home whereas direct expenses apply to your home office or studio only. Direct expenses are 100% deductible and indirect expenses are deductible in proportion to your studio’s area to the area of your entire home or apartment.

For example, if your home studio is 100 square feet and your apartment is 1,000 square feet, then you can only deduct 10% of an indirect expense (e.g. rent or utilities).

You must actually pay the expenses in order to deduct them. If you split rent or mortgage payments with someone else, for example, you can’t take the deduction for their portion of the payment.

TIP: For a deeper dive, including additional deductible expenses and a simplified calculation, check out our other article: The Home Office Deduction for Musicians.

Rent

If you work from home, rent is deductible to the extent that your home office or studio occupies your entire home. Of course, if you rent a space 100% dedicated to streaming then you could deduct the entire cost of that space.

Mortgage interest

Mortgage interest is partially deductible as a business expense, assuming you have a home office or studio. You’ll receive Form 1098 at year-end showing you the amount of mortgage interest you paid. You can deduct a portion of this amount as an indirect home office expense.

Although you can’t deduct 100% of your mortgage interest as a business expense, you can potentially deduct the remainder on Schedule A as an “itemized deduction.” This remainder would be the personal amount or the portion that’s not related to your home office or studio.

Real estate taxes

Real estate taxes related to your home are partially deductible if you work from home and are self-employed. These taxes include amounts paid to your city or county that vary based on your home value. Prepayments of next year’s taxes are deductible as long as the tax bill was assessed before year-end.

As with mortgage interest, the amount of real estate taxes that you don’t deduct as a business expense could potentially be deducted on Schedule A as an “itemized deduction.”

Home or renter’s Insurance

A portion of your homeowner’s or renter’s insurance premiums are deductible if you’re self-employed and have a home office. These premiums might be paid annually or monthly. In either case, these payments would be deductible in the year that you pay them.

Repairs & maintenance

As a self-employed DJ or producer who works from home, you can potentially deduct home repair & maintenance expenses. However, you must differentiate between repairs to the entire home and repairs that only impact your home office or studio. Repairs that are structural in nature, or apply to the entire home, are partially deductible as indirect expenses. Repairs specific to your home office or studio are 100% deductible.

Utilities

Water, electricity, and other utilities are partially deductible as indirect expenses. However, as a self-employed DJ or producer working from home, you can deduct 100% of your utility payments if your home office or studio has its own utility accounts.

Mixed-use expenses

Some expenses might benefit your business and you personally. These expenses are called “mixed-use” expenses and include things like your cell phone or internet bill.

Mixed-use expenses are deductible to the extent they provide a benefit to your music business. Only a portion of the expense is deductible. The remainder, representing the personal benefit, is non-deductible.

For example, you might use your computer to both create music and to work on personal projects or at an unrelated part-time job. In this case, you can’t deduct the full cost of the computer because it’s not used 100% in your music business. You’d need to subtract your personal use from the full cost of the computer when deducting it.

What does this look like?

Well, the exact amount of your personal use would be difficult to calculate. You should, however, use a reasonable method to estimate the personal use.

There might be many “reasonable” methods. There’s not a prescribed method by the IRS. You’re effectively calculating your business use as a percentage of your total use of the underlying product or service.

For example, you can divide the amount of hours you used an item or service for business by the total time that it was used. But you can use another unit of measurement that makes sense for the expense. This could be time, space, or whatever else adequately represents how the expense was utilized.

The main takeaway is that when you use something personally, it’s only partially deductible.

Home internet

As a self-employed musician, a portion of your home internet subscription is deductible if you work from home.

To figure the deductible portion, calculate how much of the subscription was used while working. Apply this percentage to the total cost of your home internet subscription throughout the year. This is your deductible amount.

Cell phone

Your cell phone bill is deductible if you use it for business calls as a self-employed musician.

Unless you have a dedicated business cell phone, you’ll need to determine the extent to which you used your cell phone for business versus personal communications.

Credit card interest

You can deduct credit card interest related to your music business.

The interest must have accrued on business purchases only so, assuming purchases were made on your personal credit card, you’d calculate the business and personal interest separately when taking this deduction.

You don’t need to worry about this calculation if your credit card is used exclusively for business purposes. You can deduct all of the credit card interest you paid during the year. Streamlining this calculation is a benefit of segregating your personal and business accounts.

Furniture, hardware, & equipment

Whether it’s studio furniture, recording equipment, or something else, at some point you’ll purchase “depreciable” assets – otherwise known as property that you’ll use for one year or more.

Here are some examples of depreciable assets.

Computers

Laptops/desktops
Tablets
Keyboards
Mouses
Phones
Monitors
Cables

Studio furniture

Desk
Chair
Risers
Stands
Tables

Music Equipment

Turntables
CDJs
MIDI Controllers
Controllers
Speakers
Flight cases
Lights
Streaming tower
Trussing

Streaming & recording equipment

Camera
Microphone
Arms
Headphones

Depreciation Rules

Because you’ll use these items for more than one year, you must deduct an item’s cost over the useful life; often 3, 5, 7, or more years. However, there are exceptions to this rule that allow you to deduct the cost in the year you purchase the asset. Let's review these exceptions.

Safe Harbor Depreciation Rule

Under the safe harbor rule, you can deduct any asset in the year of purchase if the cost was less than $2,500. You must include a statement on your tax return stating that you’re using the safe harbor rule to deduct assets.

As an example of this rule, if your computer cost $2,000, you wouldn’t need to depreciate it. Also, if you paid $5,000 in total to furnish your production studio, you could deduct any specific piece of furniture that cost less than $2,500.

Section 179 Depreciation

Now, suppose your computer costs more than $2,500. You could potentially deduct the full cost under “Section 179” rules. This entails reporting the cost on Form 4562 of your tax return and including depreciation schedules (your software or tax pro will do this for you).

Under the Section 179 rules, at least 50% of the item’s use must be for business purposes. Like other mixed-use deductions (see above), if you use the computer personally then you’ll need to subtract your personal use of the item when figuring your deduction under Section 179.

Bonus Depreciation

Lastly, when starting your music business, you might have begun using a piece of equipment or furniture that you had been using personally up until that point. You could potentially deduct a portion of the item’s cost through bonus depreciation.

Office & music studio supplies

You might purchase things from time to time for the benefit of your home studio. These purchases would be deductible to the extent–you guessed it–that the items are used in your home studio.

Cleaning supplies (disinfectant, wipes, fragrances, etc.)
Computer accessories (cables, hard drives, switches, etc.)
Reference materials (how-to-books, guides, tutorials, etc.)

Retirement plan contributions

Although it’s not strictly a business expense, contributing to a retirement account provides tax benefits in a few different ways. First, your contributions are deductible. Second, the investment earnings within the retirement account grow tax-free until retirement, at which point they’re taxable when you withdraw the contributions and earnings.

The opposite is true if your retirement account is a “Roth” account. The contributions aren’t deductible but the investment earnings are tax-free if withdrawn during retirement.

As a self-employed DJ or music producer, your retirement account options are:

Traditional or Roth IRA
SEP IRA
Solo 401(k)

The SEP IRA and Solo 401(k) are unique to business owners such as yourself. These plans have contribution limits based on your business income, which can help you put more money away for retirement. Refer to IRS Publication 560 for more info.

Non-deductible expenses - what you can’t write off

Even if you pay for something through and for your business, it’s not necessarily deductible. The IRS limits deductions in some cases even if the deduction is business-related. Here are some examples of non-deductible business expenses:

Entertainment
Fines & penalties
50% of business meals
Political contributions

In some cases, your business might pay for an expense but the deduction must be taken as a personal expense on Schedule A or Schedule 1 instead of on Schedule C as a business deduction. Such expenses include:

Medical expenses
Health insurance premiums
Charitable contributions
Losses due to theft or natural disasters

Of course, personal expenses generally aren’t deductible unless tax law explicitly allows them to be deducted. As a music industry professional, because the line between personal and business is not always clear. Be prepared to support any deduction you take with proper documentation and justification.

Tracking write-offs as a DJ or producer

Maintaining records is a good practice for any business. By “records,” I’m referring to documentation such as receipts and the system through which you track your income and expenses.

You can use free software like Wave or paid software like QuickBooks for this purpose or keep it simple with an Excel or Google Docs spreadsheet (both free).

Recordkeeping is important for a number of reasons.

First, it’s tremendously helpful at tax time when your business income and expenses are ready to go. In the event of an IRS audit, you’ll be glad to have your receipts, statements, and invoices all in one place and ready to be added to your tax returns.

Second, by tracking your income and expenses you’ll better understand the profitability of your business. Understanding your numbers helps you build a more sustainable business and course correct as needed.

For example, if your bank account balance is low, is it because your rates are too low or because your expenses are too high? By tracking your income or expenses, you’ll be better informed to answer these questions.

Have questions about tax write-offs?

Hopefully this article has helped you understand your deductions as a DJ or producer. But if you have any questions, please reach out using the contact form below.