Why Musicians Pay Taxes But A Billionaire Doesn’t

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These past few days and weeks have been pretty rough out there on the American political landscape for the Republican nominee for president. Putting aside having had his clock cleaned in a televised debate in front of 84 million people, tweeting disturbing early morning rants about a Latina beauty queen he calls Miss Piggy — and lying about her making a sex tape — he’s also accusing his opponent of marital infidelity and his charitable foundation is being investigated for fraud. Now comes news that he used a tax loophole to avoid paying personal income tax for close to 20 years.

And who knows for sure; maybe he’s never paid a dime. Ever. He is the first and only modern presidential nominee who refuses to share his income taxes with the public. I think my late father would probably say something like, “Where there’s smoke, there’s fire.”

Now I don’t know about you, but I have been filing and paying my taxes for close to 44 years. I’m not alone. My friends, relatives, co-workers, and neighbors pay their share too. And while we all complain and wish we could pay a lot less, most of my people are considered middle-class wage earners, and we’re not able to take advantage of the tax laws and loopholes that are given to the wealthy folks. My entire life, I’ve heard politicians tell me that they’ll fix it once elected, but it hasn’t changed. If you want to talk about a rigged system, you can start right there.

Back in the early 1990s, Donald Trump’s hotel-airline-casino empire fell apart and he filed bankruptcy four times. He laid off thousands of people, stiffed contractors and suppliers, stripped the value of his holdings to leave his creditors with staggering losses, and he took money off the table for himself. He proudly calls himself a “brilliant” businessman. He claims he’s the best candidate to fix the system since he is a genius at ripping it off. To me, that’s the equivalent of putting Charles Manson in charge of overhauling our criminal justice system.

Now, before I go too far off on a tangent here, let me pull it back a little bit. Since this is a music website, lets talk about musicians. For the sake of this conversation, lets exclude those on the level of Bruce or Bono, Madonna or Taylor. Let’s be real: for every Snoop Dogg, there are probably 25,000 players barely making minimum wage.

Your favorite Americana-folk-blues-jazz-bluegrass picker-singer-songwriter-indie-alt-whatever musician might crowd source 20 thousand dollars to record and market an album, go out on the road and perform at clubs, coffeehouses, house concerts and maybe some festival dates, travel for the most part on four wheels in a crowded vehicle, eat whatever food is offered to them, take time to do benefit shows every so often, and then spend some serious dough to go to trade shows and conventions to drum up even more dates. If they’re lucky, at the end of the year, they’ll pull in somewhere between 20 to 80 thousand dollars a year. Just an un-educated guess. Maybe more, maybe less.

Reaching out to some of my friends who actually make their living playing songs  for you and me, I asked them how they earned their dough, kept track of expenses, and managed to run a business while staying creative. Not surprising, it ain’t easy.

For those at the low end of the range, there are some tax laws that allow for them to keep most of what they earn. Moving up the income level, they balance obligations and deductions just like most other creative types and independent contractors. Without a day job, there’s nobody contributing a portion of their check into social security, so they pay the full amount. There’s no employer providing health insurance, so that’s another expense. It’s a little easier to do that today with the Affordable Care Act, but healthcare is still pretty expensive for many people and you’ve got oodles of Republican politicians trying to take it away altogether.

On the other hand, musicians and other independent contractors can write off some expenses that people with regular jobs cannot: travel expenses, meals on the road, clothes for the stage, music to listen to, lessons to hone their skills, concert tickets and instruments. If they have an office in their home or a studio, there might be other deductions available.

A musician has to document business-related spending by keeping track of daily receipts, expenses, and a detailed  travel log, and it helps if they keep separate bank accounts and credit/debit cards for business expenses. Many have an accountant and probably just as many don’t. It basically comes down to feeling confident with their financial literacy, and balancing that with the complexity of their musical endeavors.

And at the beginning of each year, musicians gather up their 1099 forms, figure out what they earned, calculate what they paid out, and guess what … they pay their taxes. Just like me, just like you.

There’s an argument to be made that paying your “fair share” is a patriotic act. But there’s also another way to look at it, and it’s about millions of people chipping in a portion of what they earn to help all of us enjoy a decent life. Not just the one percent who make the most money, but each of us.

In closing, I went over to the website for the Center on Budget and Policy Priorities to see exactly how our tax dollars are spent. Here’s the breakdown:

25%: Health care or long-term care to about 72 million low-income children, parents, elderly people, and people with disabilities.

24%: Social Security for 40 million retired workers, 2.3 million spouses and children of retired workers, 6.1 million surviving children and spouses of deceased workers, and 10.8 million disabled workers and their eligible dependents.

16%: Defense and security-related international activities.

10%: Safety net programs to individuals and families facing hardship.

8%: Benefits for retired federal workers and veterans.

6%: Interest debt.

4%: All other expenses.

3%: Education.

2%: Science and medical research.

2%: Transportation infrastructure.

In the case of Donald Trump, this list is what he didn’t contribute to. We did, but he didn’t. Nothing for our vets, our military, our kid’s education, the elderly, the sick, those in need of a helping hand, highways, bridges, airports, trains, or border security.

Thanks for nothing — and I do mean nothing.

This was originally published as an Easy Ed’s Broadside column at No Depression dot com.