Art Business Paperwork

Yee, dawgies! As we say in Texas. Paperwork is the bane of my life as an artist, and in that respect I’m not alone. So much paperwork! Just leave me alone and let me paint!

Ah, well, the problem you run into ignoring paperwork is that your studio piles up with unsold paintings. It really is a good thing to allocate some time for paperwork (and I include here computer work) for your art business. After all, if you are selling your art, it is a business.

There are many kinds of paperwork (these days, mostly computer work) involved in selling your art. Let’s look at how to handle some of them.

Sales Taxes

If you sell your art directly from you to the buyer in the state where you live, you are required legally to pay sales tax. You have to have a sales tax license, which you can get from your State Comptroller’s Office, usually for free. But once you get the license, that office sends you paperwork to fill out to report how much you sold and how much you have to pay and you have to pay it by a certain date.

If a gallery sells your painting, they pay the sales tax and you don’t have to pay. If you sell to a person out of state and mail it to them, usually you do not have to pay sales tax. But if you travel to another state and sell your art to an individual in that state, you have to pay sales tax to the state where you sold the painting. When I travelled and did a lot of weekend Art Fairs, I had sales tax licenses from about 5 or 6 states. Some shows let you pay the tax to them and they pay the state sales tax, which makes life easier.

Anyway, get a license for the state where you sell your art. Collect the tax from the buyer and sock it away somewhere, and pay it when it is due. The upside of having a sales tax license is when you go to an art supply store and buy art supplies that are used to create paintings for sale, you don’t have to pay sales tax on the art supplies.

The main thing you have to keep track of is which paintings you sold that you have to pay sales tax on. I have two lists – one that has income from direct sales (I pay the tax) and one that has income from a third party (like a gallery), where I do not have to pay the tax. I pay sales tax in Texas once a year and when the time comes (January) I add up the list and pay the tax.

Income Taxes

Keep all your receipts. For art supplies, frames, postage to ship packages, office supplies (you used tape to tape up the packages), money paid for entry fees and booth fees, your website hosting fees, fees you paid to eBay, PayPal fees, credit card processing fees, membership in art club dues, every single thing that you spent money on that contributes to your art business.

Keep track of the miles you drove on your car in order to do your art business. I have a log book in my car for this purpose. Keep receipts of repairs and maintenance on your car.

If you have a studio in your house, keep all the receipts for electric, water, mortgage interest, gas, everything to do with upkeep of having a studio in your house. You can deduct 10% of these expenses to run a studio in your home.

You can look at a tax form Schedule C, which gives you all the categories you can use for deductions for your art business. I make a folder for each category, plus a separate one for car expenses and another for house expenses. Every so often I sort my receipts into these folders and when tax time comes around, I add up receipts in each category and just plug them in to the tax forms (online, these days).

The flip side of expenses is income – you have to keep track of your income from your art business. You could keep a written list, but I just put all that income into one account and at the end of the year, I can see how much I made.

Applications to Shows/Contests/Galleries

Make a copy of your applications to shows and contests and of your contracts with galleries and file each in a separate folder. When you get rejected, you can toss that one out, but you will be surprised at how much you need to have these around for when you get accepted.

I just got accepted to paint a mural on a traffic box. More than a year had elapsed since I sent in the application, so I figured it was dead in the water and tossed it out. When I got the email that I was accepted and I am supposed to paint the thing this month, I had to ask what I had entered that I am now supposed to paint, if there would be any payment and who is paying for paint supplies, etc. Sort of embarrassing, but I’m sure they thought “just another flakey artist.”

Lists of Deadlines

Keep a list of deadlines for shows/projects/contests/ grants that you intend to apply for. You might be browsing art opportunities on a website like AnyArtist.org and see something you want to apply for but the deadline is months away. So you don’t do it now. And then you forget it and miss the deadline.

Keep a list. Or mark deadlines on a calendar so that you can see what’s coming up.

Lists of People who have Bought your Art

For years I kept names and addresses of people who bought my art and I sent them postcards whenever I was going to be in their area. It resulted in a lot of sales for me. The list was over 5,000 names.

Nowadays, you want to get email addresses. I did not get email addresses, so I have a list of 5,000 art buyers that is completely out of date and unusable considering the price of postage. Keep a list of names, addresses and email addresses of your customers. You will be able to advertise your studio show, or your gallery opening. Whatever event you want to promote.

Lists of People Interested in your Art

Same as above. People who were interested but did not buy at one time often come back later and buy your art. Promote to them.

Photographs of your Art

Before you sell it, take photographs of your art and keep a computer file of all your artwork. I photograph every piece as soon as it’s done. You can put it on your website or post it to Facebook, or Instagram or use it to create future promotion.

Lists of Helpful Contacts

Helpful contacts would be people who in some way have helped you with art. Maybe gallery owners or people who donated to you on Patreon or someone who works for the city and helped you get a commission for a mural. These are very important to your business and you should cultivate them.

The End

This may not be a complete list of artist paperwork, but it covers a lot. THE MOST IMPORTANT piece listed here is the list of people who have bought your art. I cannot tell you the number of times one of my patrons has come back and bought a second or third or even more paintings from me. I try to communicate to each of them (the ones I have email addresses for) regularly, and it has been very rewarding. The IRS and state comptroller may not think this is the most important list, but it is. IRS and comptrollers would not get any tax money at all if not for this list.

Happy Trails,
EC Sullivan Fine Artist

 

© Copyright 2023 Help 2 Succeed. All Rights Reserved.  noai noimageai
This article was written by a human regarding real life experience.