When it comes to deducting unreimbursed business expenses on your tax return, if you are a “starving artist,” you get a special tax break that other “regular” employees don’t. Prior to 2018, employees could deduct unreimbursed business expenses in the Miscellaneous Itemized Expense section on Schedule A, subject to the 2%-of-adjusted-gross-income threshold. The 2017 tax law ended that deduction.
However, if you qualify as a “starving artist,” you can still deduct certain unreimbursed business expense, such as vehicle expenses, parking fees, tolls, various other transportation and lodging expenses, and certain meal expenses. You use Form 2106, Employee Business Expenses, to calculate the amount, which you then report on line 11 of Schedule 1 of Form 1040.
Who qualifies as a “starving artist?” you ask. To qualify, the individual must have been employed in the performing arts by at least two employers, earned $200 or more in wages per employer, had expenses in excess of 10% of income, and their adjusted gross income cannot exceed $16,000.
So, you probably would prefer to NOT qualify as a starving artist. But, if you do, you still get this tax break that other, better paid employees no longer get.
By the way, Reservists or National Guard members can deduct overnight travel expenses for trips over 100 miles using this same Form 2106 and Schedule 1 of Form 1040.
If you have questions about qualifying as a starving artist or other tax issues, contact the Sodowsky Law Firm at 703.968.8000 to arrange a confidential meeting with one of our attorneys.
— Elden Sodowsky