Disclaimer: This is not financial advice. Ask your tax professional before taking action.
This deduction is specifically for freelance musicians who spend a significant amount of time traveling for gigs.
If that's you, read on!
This single deduction saves me the most money every year and I wish someone would have told me about it long ago!
M & IE (Meals and Incidental Expenses) Per Diem
Most musicians know that you can deduct meals and lodging when you are traveling for a gig.
What most musicians don't know is that rather than deducting each specific meal or accommodation expense, you can instead choose to deduct a set daily per diem rate that is determined based on the the state and town you are traveling to.
If you are traveling more than 50 miles and are away from home for more than 12 hours, you are eligible to use this per diem rate.
Unless you are eating out at fine dining restaurants, getting hammered every night, and/or staying at the local Hilton, the per diem rate is going to be a MUCH larger deduction than the individual meals, accommodations, etc.
Here's the best part:
Even if you pack meals at home, eat at McDonald's, stay at friends houses, etc. to save money, YOU CAN STILL DEDUCT THE FULL PER DIEM RATE!!
How to Do It:
Go through your calendar and identify any gig where you traveled over 50 miles and stayed there for at least 12 hours.
Record the number of nights away, the dates you were away, and city / town the gig was at.
Go to this website and input the details: https://www.gsa.gov/travel/plan-book/per-diem-rates
Determine how many days you were traveling for the gig. The first and last days of travel are calculated at 3/4 the regular daily rate. So if you traveled from your home in Boston to a gig in Portland, ME, and stayed in Portland for 4 days, 2 days would be calculated at the full rate and 2 days would be calculated at the 3/4 rate. Both rates are provided on the above website.
If you were only away from home for one day but the gig was over 50 miles from your house and you were away for at least 12 hours (such as a full day travel gig,) then you are eligible to deduct one day at the 3/4th rate.
Definitely check in with your tax professional before doing this but this deduction has been a GAME CHANGER for me!
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