If you’re a professional artist, maintaining an organized bookkeeping system will allow you to keep track of your sales and expenses, and avoid problems with the IRS. Here are a few simple tips from Laguna Hills, California, artist Pamela Calore:
- File your expense receipts in an accordion file with the pockets designated and labeled for each expense category shown on the tax form. Label a separate pocket for “sales.”
- Whenever you buy supplies or pay for anything else related to your painting business, get a receipt (a cash receipt, credit card bill or canceled check) and file it in the appropriate expense pocket.
- When you sell a painting, photocopy the check before you deposit it as a record for the “sales” pocket.
- At the end of each year, just add up the receipts in each pocket to get your total expenses by category along with your total income.