10 Tax Deductions That All Freelancers Should Take Advantage Of

Tax Deductions

Taxes are freakin’ confusing.

Are you deducting everything you could be and getting back as much money as possible?

In this post I’ll be sharing with you a quick overview of what tax deductions are as well as 10 tax deductions that will save you thousands of dollars in the long run!

Let’s dive right into it.

Disclaimer: I am not a tax accountant and reading this advice does not create any client relationship or other advisory between us. You alone bear the sole responsibility of accurately filing your taxes. Good luck!

 

TAX DEDUCTIONS 101

More often than not, you will be hired for Brand Ambassador gigs as an Independent Contractor.

This means that you are NOT an employee of the brand or agency that hired you and that taxes are NOT taken out of your paychecks. Rather, you’re paid in full up front (woohoo!) but you must pay back any taxes you owe at the end of the year (boo…).

However, the IRS (Internal Revenue Service) understands that you, as an Independent Contractor, are essentially running a small business and they allow you to deduct part of what you spend on your Brand Ambassador business from the amount that you would owe for taxes.

It’s one of the perks and rights of being an Independent Contractor.

Simply put, you get to claim a portion of the money you spend on anything Brand Ambassador work related.

But if you don’t claim those deductions, then the IRS gets to keep it.

This is why it’s VERY important that you keep a detailed record of all of your expenses along with receipts so that you don’t miss any valuable tax deductions and can also cover your butt in case the IRS has questions.

(I recommend using the app, Shoeboxed, to keep track of all of your receipts and expenses).

Let’s not give the government anymore of your hard earned money, yea?

Below are 10 Brand Ambassador specific expenses that you can deduct from your taxes! CHA CHING!

 

1. BUSINESS MEALS

You are allowed to deduct 50% of your business meals when you have to work and eat out of town (only one meal per day). If you are in-town, even if it’s for business, you are not allowed to write your business meals off. Because of the potential for abuse, the IRS keeps a close eye on meal deductions so you’ll want to be extra careful here. Keep records of all out of town meals and which events they were for.

 

2. PERSONAL WEBSITE

You are able to expense any costs you spent on marketing and advertising yourself. Whether it’s for your promo work, your acting gigs, your business, or your blog, a personal website is tax deductible. Bluehost is the website hosting provider I recommend to everyone because they are the cheapest, easiest, and offer the best service. They make it extremely simple to build a website, which everyone needs to have in this day and age. It only costs $3.95 per month for hosting and you get a FREE domain name (www.YourName.com).

Click here to learn how to make your very own website or blog in less than 10 minutes!

 

3. HOTEL AND AIRBNB EXPENSES

If you’re traveling for work and your accommodation costs are not covered, you can write these expenses off as well! Hold onto all of the receipts and keep track of what dates and events you needed accommodation for just in case. While hotels used to be the go-to option when travelling for work, Airbnb.com has quickly risen in the ranks since you can now stay in a comfortable house/apartment/villa for about the same price or less. Using Airbnb is such a great option, especially if you have a good group of friends or coworkers with you!
Here’s $20 off of your first Airbnb experience. Have fun!

 

4. PHONE BILL

We use our phones constantly for this industry. We use it for our interviews, GPS, job searching, communicating with managers and staff, keeping track of receipts, etc. Whatever percentage of your phone and internet usage you use for Brand Ambassador related work can be written off as an expense.

 

5. TIPS ALCOHOL CERTIFICATION

Your TIPS Alcohol Certification training is also tax deductible since it’s an educational expense specifically for the industry. Brand Ambassadors who are TIPS Alcohol Certified get access to promotions like Wine Tastings, Clubbing Events, Bars, and Retail Sampling just to name a few. Your certificate will pay for itself after just 1-2 hours alcohol promo work! Hopefully knowing that it’s tax deductible gives you the push you need to get it if you don’t have it already.

Check out this post to learn how to become TIPS Certified and start getting paid to party!

 

6. BUSINESS CARDS

Networking will get you very far in this industry and business cards are a must for effective networking. They are one of the most valuable marketing tools you can have as a Brand Ambassador and the best part is that they are tax deductible! Moo.com consistently ranks as having the best business cards in the business and they also have tons of designs for you to create your perfect business card with.

Get a fat stack of personal business cards through Moo today for as low as $19.99!

 

7. INDUSTRY RELATED LEARNING

If you purchased any online courses, ebooks, or books about the Brand Ambassador industry or are subscribed to any event marketing magazines, you can write these off as educational expenses. The government wants you to stay sharp as a small business owner so go ahead and buy that resource you’ve had your eye on 😉

 

8. PARKING

Depending on the events that you work, you may have to pay for your own parking. These costs can really add up if the agency doesn’t cover them so be sure to keep track of those receipts and event dates because they are tax deductible.

If you have to park close to a convention center or some other type of high foot traffic area, finding a parking spot could be a real pain. I recently found out about a website called Park Me and it’s a website/app that shows you where the cheapest parking is. It’s usually a lot cheaper than the price you’d pay if you just pulled into a lot and you get to pay in advance so you know you’ll have a spot when you arrive!

Check them out at http://parkme.com/

 

9. MILEAGE

Because you work from a “home office” and must drive to different locations for work, such as events and tradeshows, you are allowed to deduct your business mileage. Beginning 2016, the standard mileage rate is now 54 cents per mile for business miles driven. However, it should be noted that the IRS loves to scrutinize mileage deductions so be sure to have a mileage log in your car at all times and keep track of your receipts. As a Brand Ambassador you’ll be driving for your gigs often so you won’t want to take any chances here.

 

10. TRANSPORTATION

If you’re not using a car to get to work and have to take another form of transportation, such as a train, boat, bus, plane, taxi, Uber, or Lyft, you can write these off as well. Be sure to keep these deductions separate from your mileage though. Transportation expenses are the number one item that IRS auditors look at so please be honest here to avoid being red flagged.

And just like that you now know of 10 tax deductions you can take to save you thousands of dollars on your taxes!

If you’d like to have “10 MORE Tax Deductions Brand Ambassadors Should Use This Tax Season” sent immediately to your inbox, simply click the image below.

I hope the tax deductions tips above help you get as much money back as possible during this hectic time of the year. If you’d like to learn more about taxes and what you can and cannot deduct, please refer to the IRS’ website at https://www.irs.gov/.

Tax deductions can be very confusing but with a basic understanding of how they work, you’ll be able to protect yourself as well as set yourself up for immediate savings and profitability.

Good luck my fellow Brand Ambassadors!

Kenny teaches friendly and outgoing people how they can get paid to represent their favorite brands at amazing events across the nation. Read Kenny’s story of how he went from being broke and in debt to making $8,000/month as a Brand Ambassador. Feel free to send Kenny a message here!

Here’s Why Agencies Take So Long to Pay

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30+ days is a long time.

That’s about how long it takes for a Brand Ambassador to get paid after working an event. Sometimes it’s less, sometimes it’s more but for the most part, Brand Ambassadors usually have to play the waiting game before receiving their hard earned check. While there are a handful of agencies that pay much quicker than 30+ days, many of them do not.

Seems bogus doesn’t it? Well, there’s a good reason why agencies take so long to pay and that’s what we’ll be covering today.

 

First, let’s start with some terminology. The word “net” is often used in Brand Ambassador contracts and this means “total after all discounts.” It is a form of trade credit that agencies use to inform Brand Ambassadors how long their payment will take to reach them. For example, if you see “Net-30” on your contract, that means the agency will pay you within 30 business days days. “Net-45” means you will be paid within 45 business days. And so on.

The reason why it takes so long for you to get your check is because agencies are the middle man between you and the client.

It takes time for the client to pay the agency, which is why it takes time for the agency to pay you.

It’s rare for a client to pay an agency in advance and if they do it’s only to cover the start up costs of a large program. Most agencies invoice the client after an event and receive payment from a client 30-60 business days after submission.

Because the agency has to wait, so do you.

It’s not like agencies want to make you wait. If it were up to them, they would love to pay you quicker than Net-30+ but unfortunately that’s just the standard turnaround time in this industry.

Event Marketing has many moving parts and there is a lot that goes on behind the scenes that most people are not aware of. Here is the process that usually happens between an event taking place and you receiving your check:

  1. You worked an event. Woohoo!
  2. Time sheets are taken in
  3. Hours are accounted for and given to payroll
  4. Payroll bills the client for worked hours
  5. Hours must be approved by the client
  6. If there are discrepancies, then those must be dealt with before the agency is paid
  7. Client mails a check to the agency upon approval of hours
  8. Agency deposits the check and processes all Brand Ambassador checks
  9. Agency mails your check to you

Now this is not the case for every single agency, but this is generally the process. It all has to go through the accounting departments of both parties one way or another before you get your money.

A common question I get from Brand Ambassadors is “why can’t I be paid weekly or bi-weekly like a normal job?” The simple answer is because you’re not an employee. Employees are granted different pay terms and benefits than an Independent Contractor would get.

As a Brand Ambassador, you are considered an Independent Contractor and are only paid when you provide a service and according to the terms of the contract that you entered.

If you are thinking about becoming a Brand Ambassador, you must take into consideration the advantages and disadvantages of being an Independent Contractor. While being a Brand Ambassador is an incredibly fun, flexible, and lucrative job, it does not come without its challenges and having to wait a little longer than usual for your check is one of them.

If you decide that you do want to be in this industry and you want to avoid any drama or miscommunication with an agency over payment terms, my advice to you is simple:

  • Carefully review the job description for payment terms
  • Carefully review the contract before you sign it
  • Ask Program Managers any questions you may have before accepting any contracted work

If you willingly accept the contracted work, then it’s your responsibility to abide by any payment terms that you sign for.

Having worked for an experiential marketing agency, I have to admit that it’s really frustrating when Brand Ambassadors get upset over how long their payment takes after they themselves signed and agreed to the payment terms. This is just bad business practice and agencies will not want to work with you if you do not respect your contracts. If both parties abide by the contracts, then everyone should be happy!

If the payment has not shown up after the agreed upon net terms, please refer to the article “3 Reasons Why an Agency Isn’t Paying You and What You Can Do About It” for further information.

 

Now you know why agencies take so long to pay you your check!  As long as you stay organized and budget accordingly, the flexibility, the fun, and the pay rate are so worth the wait. If you know someone who could benefit from this article, please share it with them.

When’s the fastest you’ve ever been paid? When’s the slowest? Share your experience in the comments below.

Kenny teaches friendly and outgoing people how they can get paid to represent their favorite brands at amazing events across the nation. Read Kenny’s story of how he went from being broke and in debt to making $8,000/month as a Brand Ambassador. Feel free to send Kenny a message here!

3 Reasons Why an Agency Isn’t Paying You (and What You Can Do About It)

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You just worked your butt off for an agency and are expecting a big, fat, juicy check to arrive in the mail in 30 days just like the agency promised. 30 days goes by and you wait…and wait…and wait.

Sound familiar?

One of the best/worst parts about being a Brand Ambassador is that often times we are classified as Independent Contractors and not Employees. What this means for us is that we understand that we are not on payroll and that we agree to the payment terms that an agency sets for us before accepting the work.

But what happens if an agency is late on their payment or worse, shows no intention of paying you?

There are really only three reasons why an agency isn’t paying you. Those reasons are cash flow, miscommunication, or they just have no intention of paying you. Let’s address each issue one at a time:

*Legal Disclaimer: I am not a lawyer and I have no legal training. The following article is a product of my own experience at an agency as well as hours of research. Please do your own research and hire proper legal counsel if necessary.

 

1. CASH FLOW

Agencies are the middle man between you and the client (brand).

In most cases, your payment is delayed because the client is late on paying the agency. If the agency gets no money, you get no money.

It’s like the airline safety demonstration: “passengers must take care of themselves before they can take care of others” and that is exactly what agencies must do from time to time, even the best ones.

As annoying as it is for you to have to wait, this is an absolute nightmare for agencies as their entire company is on the line at this point. Try to be understanding. If it’s just a cash flow issue, you’ll eventually get paid.

I advise you to just be patient, polite, and to check in from time to time. You don’t want to burn any bridges here by being rude, annoying, making threats, or posting publicly. Simply ask for a timeline of when to expect payment and hold the agency accountable.

If it’s NOT a cash flow issue then it might just be a miscommunication issue.

 

2. MISCOMMUNICATION

We all make mistakes sometimes. We’re human!

I’ve seen countless situations where Brand Ambassadors throw a fit, claiming they never got paid, only for them to find the check in their room under some clothes. On the flip side, I’ve seen agencies claim that they have paid all of their staff up to date only to realize that they misplaced an invoice or sent the check to the wrong address.

There are a billion other reasons why a check might be delayed or missing but all it takes is a few quick emails to resolve the issue.

If an agency claims that they paid you but you didn’t get it (and you’ve already double checked your house), you can request a receipt of the payment and ask if the checks have been cashed.

-If the agency realizes that they did not pay you, then they should pay you immediately.

-If the agency did send the payment but the check was cashed by someone else, then you have a fraud problem on your hands. Work with the agency to figure out who cashed the check and then file a police report. The agency should send you a new check in this case.

-If the agency did send the payment but you did not receive it and it has not been cashed, then it’s most likely lost somewhere. Agencies may delay paying you here because of the fact that they would have to pay a void check fee and that would be a waste of money if the check eventually showed up at your door. However, if a reasonable amount of time has passed since the check was due (2+ weeks), you have grounds to request a new check be sent to you.

If it’s neither a cash flow nor a miscommunication issue, then you have the issue of an agency or individual who has no intention of paying you.

 

3. NO INTENTION OF PAYING

The third and most dreadful reason why you haven’t received your payment is because the agency or individual you worked for has no intention of paying you.

If the money owed to you is not substantial, then the best option for you will be to just write it off as a loss and move on.

I  know, that’s not what you want to hear.

While the principle of it is not right and you may really need that money, the time and money you’ll spend getting that check is usually not worth it.

However, if the money owed to you is a substantial amount ($1000+) and you are willing to fight the good fight, then you have a couple options here:

-Filing a complaining with your city’s Labor Board

-Suing the agency/individual to your city’s Small Claims Court

While both options present their own challenges and timelines, if you are dead set on collecting that payment, I would recommend going to Small Claims Court over the Labor Board.

In fact, debt collection cases are by far the most common type of cases that are resolved in Small Claims Court.

 

Additional Things to Consider:

-Unless you are a classified as an employee of the company, you are not entitled to waiting time penalties

-Most agencies have you sign a Non-Disclosure Agreement (NDA) upon hire. If that’s the case, you are not legally allowed to contact the client of the agency directly and doing so may get you in trouble. Don’t do it unless you have evidence of the agency or individual not returning your correspondences and are absolutely sure that they have no intention of ever paying you.

-While you could hire a lawyer and/or go to Superior Court, I would advise against doing so. Small Claims Court is where you’ll want to handle small debt collection and unless the amount owed to you is significantly more than the Small Claims Court limit or you would like to sue for something other than your missing payment, hiring a lawyer and going to Superior Court is going to be much more money and time than it’s worth.

 

Good luck to any of you who are experiencing a delayed or missing payment right now and I hope that this article helps you get your money in a timely and convenient manner.

Kenny teaches friendly and outgoing people how they can get paid to represent their favorite brands at amazing events across the nation. Read Kenny’s story of how he went from being broke and in debt to making $8,000/month as a Brand Ambassador. Feel free to send Kenny a message here!