Self-employed artists should be aware of several federal tax considerations and opportunities for deductions:
1. Self-employment tax compliance
Artists who earn income from their creative work and are not classified as employees are considered self-employed and must compute their self-employment tax liability using Schedule SE attached to Form 1040. For 2026 the combined standard self-employment tax rate is 15.3% on net self-employment income. The 15.3% is a combination of 12.4% social security tax and 2.9% Medicare tax. Deductible expenses that reduce net profit from your business not only reduce income tax liability but also reduce the amount of self-employment tax liability.
2. Deductible expenses
Self-employed artists may deduct ordinary and necessary expenses paid or incurred in carrying on their trade or business. To qualify, the activity must be regularly engaged in for the primary purpose of generating income or profit, and the expenses must be directly connected to the business. Examples of deductible expenses include materials, studio rent, advertising, travel, and supplies. The expenses must be reasonable in terms of amount and not too tenuous in their connection to the business. It is advisable to track your expenses on a regular basis and maintain a separate bank account and credit card for business deposits and expenditures.
3. Charitable contributions vs. business expenses
If an artist donates works or funds to a charitable organization, the type of deduction depends on whether the donation is made with an expectation of a commensurate financial return. If the donation is directly related to the artist’s business and made with the expectation of promoting the business or generating income, it may be deductible as a business expense under Section 162. Otherwise, it may qualify as a charitable contribution under Section 170, subject to percentage limitations and other restrictions. Double deductions are not allowed; a payment cannot be deducted as both a business expense and a charitable contribution.
