Once you take the leap of faith and begin your journey as a musician, figuring out your employment status can be confusing.

For example, is a musician (singer, guitar player, pianist, etc.) considered an independent contractor?

What do your taxes look like? Do you get a 1099?

Luckily, we’ve been through this and have some information to make your financial management more straightforward.

Update 7/1/23: This article has been refreshed with new information regarding independent musicians and how they need to pay taxes. From quarterly payments to budgeting, this post is here to assist indie music makers.

Do Musicians Qualify As Independent Contractors?

Depending on how you perform and get paid for your music, how you’re classified on paper can vary. That said, most independent artists fall under a contractor title, as they’re their own “boss.”

One reason is that as a musical artist, you aren’t clocking into work every day or answering to a specific person or company.

Of course, if you work on a cruise ship singing, playing instruments, or performing regularly in a theme park, you’re likely a W2 employee.

The key difference here is that most artists don’t have a regular employer but instead contract to different venues, events, and people.

You’ll be filling out quarterly taxes via an estimated 1099 virtual or check payment, compared to someone else working a 9-5 who can file annually in April.

Bleh. Tax talk makes our eyes gloss over too.

But knowing how and when to handle your finances as a musician is a MUST.

If you have zero idea when and where to pay your taxes each quarter or year, the government isn’t going to be nice about it.

You might also see the term “freelancer” when dealing with your taxes, which is virtually the same as an independent contractor.

You’re on your own, making money without dealing with the typical chain of command. This also applies to added income from your music, whether it be touring, merchandise, brand deals, or anything else.

Because many music artists make most of their money from touring, that will need to be accounted for on paper. Merchandise is another big one: so keep tabs on all of this information.

These added revenue streams must be reported to Uncle Sam, or you risk getting audited and paying fines and possible jail time.

We promise it’s not worth trying to hide income from the government.

Related: Can Music Artists Make Money Selling Merchandise? [Inc. Companies You Should Use]

Are All Musicians Self-Employed? Should You Get A 1099?

Although not all musicians are self-employed, many fall into this category. As we said, you’re an independent contractor if you don’t have a boss you regularly report to.

This also means you’re self-employed.

Therefore, when it comes to your healthcare, taxes, and all that good stuff: you have to figure it out 100% yourself.

Yes, it can be intimidating, but endless programs are aimed toward independent contractors (self-employed people) to make the transition easier.

According to industry experts, you will be self-employed if you’re a performer, recording artist, session musician, or anything similar.

That means you need to pay federal and state income taxes each year (federal payments should be made 4X annually) to stay on the IRS’s good side.

Whatever money you make, whether from merch, touring, streaming, private events, or anything else, you must pay taxes.

Furthermore, if you have any extra expenses along the road, you can always deduct those from your taxable income and see how much of a break the government will give you.

A standard deductible is roughly $13,850 as of 2023 and 2024, a bump from the previous 12,550. There are also write-offs for your taxes as a musician, which can help cut down on the amount of money you pay each quarter/year.

Some things independent musicians can write off include:

• Music equipment
• Hotels and restaurants (touring)
• Transportation (flights, Ubers, etc.)
• Music streaming services
• Seminars and workshops
• Phones, laptops, accessories
• Advertising for your music
• Audio editing software
• Home studio set-ups
• Creative assistance
• Start-up costs
• Studio time

*Of course, we are NOT tax professionals, so if you have any questions about your payments, write-offs, or deadlines, please get in touch with a professional tax service or preparer. We’re smart, but not that smart.*

You can use whichever tax service you like for annual taxes and then register with the IRS for estimated quarterly payments.

One glimmer of hope is that if you pay extra taxes quarterly, you may get a refund when you do your final filing in April.

This has happened to us for a few years now, and it always feels good. Pay at least 10% of your quarterly income to the IRS to stay caught up.

Related: Is LANDR Online Music Mastering Any Good? [Our Detailed Review]

Are Signed Musicians Considered Independent Contractors?

Yes and no. As we mentioned earlier, depending on the terms of your record deal, your label may handle your taxes and “adult” stuff.

First, if you are signed and report to a team of people and are told when, where, and how to perform your music: you’re an employee.

In contrast, if you have a manager but make your own rules and schedule, that’s a freelancer/independent contractor.

According to Payroll Partners, if a musician is being managed and told when/where/how to perform, they are covered by FLSA.

That is the Fair Labor Standards Act.

This United States labor law creates the right to a minimum wage and “time-and-a-half” overtime pay when people work over forty hours a week.

Just because you’re signed under a label doesn’t mean you suddenly lose your rights as a worker/employee. Record labels do a lot of the heavy lifting for you, but they aren’t going to file your taxes on your behalf.

You may lose your right to creative freedom, but that’s another story for another scathing article we’re afraid to write. One of the murky sides of the music business is how artists are paid.

This can be through royalties, set agreements, lump sums (don’t take these), or quarterly payments based on performance.

Regardless, you NEED TO PAY TAXES on whatever you make.

We don’t care if it’s $10 or 10 million: pay your taxes.

Time and time again, artists think they’re too cool for the IRS and end up with hefty fines, countless bad press, and even jail time.

Nobody wants to give up their money, but it’s much better than giving up your freedom. Make good music and decisions; we promise it will feel better long term.

We also have these articles that may be helpful on your journey:

How Much Money Do Independent Musicians Make? [And How To Get Rich]

What’s The Best Way To Promote Music As An Independent Artist?

How Much Money Do Audio Engineers Make?