I’ve been in the music business for a long time. I’ve played many shows, had many fans, and release a lot of records. All of these things do one thing. They create income and problems for independent musicians like myself. I have no clue how to file my taxes, make estimated payments, or make sense of all the bookkeeping things I am supposed to do. That’s why my advice to any young musician is to find an accountant who knows what he is doing. I looked online and found many CPA reviews that are quality, but I was looking for something in particular.
There are many different types of tax accountants out there, but you need a music industry CPA who knows something about the traveling business of a musician. I found a great tax CPA who used to be a guitarist in a band and now owns a tax and consulting firm in the Northeast. After talking with him, I know more about my business and have a good understanding of what I need to do to keep it running. I also know what makes a qualified CPA.
First, the accountant has to pass the CPA exam. I didn’t know it was as difficult as it is, but apparently it’s one of the hardest standardized tests. There is an entire industry devoted to CPA exam courses and reviews to help people pass the exam. It’s kind of amazing that any type of test could be that hard.
After someone passes the exam, they have to fulfill some level of training and requirements before they can be certified and licensed in their state. My CPA told me that it is similar to becoming a lawyer or doctor. First, you have to get your degree. Then you can take the exam. Then you can do the work requirements and get your license.
Don’t let all of this fool you. Some accountants are good and some don’t know what they are doing. I found this out the hard way when I was audited a few years back for my band income. Going with a lower level accountant will save money on CPA products and services, but it won’t necessarily be the best for your business. My current accountant straightened everything out and now I am well taken care of.
Needless to say, it’s important to know a good accountant and have a good relationship with one. Unfortunately, the music business is just that. It’s a business and sometimes we have to treat it like one. Getting to know your accountant and having a close relationship with him or her will help you make the right business decisions that will make your band go farther and maybe even make it big. I hope this helps. Email me if you want to know who my guy is. I’d be happy to refer any musician to him.