So, the answer for an artist, to protect them selves, it form a LLC? Incorporate in some way that strongly identifies themselves as a business?
One of the main reasons I don't like freelancing on random gigs, or out of the norm boxes, is for a variety of tax reasons - running my own business - I do feel a greater burden falls on you to make sure you are covering your butt as far as tax laws. This is where you hire the professional.
I think the freakish argument that comes out in the article is " . . .chief among them that de Mars took too much pleasure from her work, and didn't work hard enough to make a profit. As a result, state officials say she owes thousands of dollars in back taxes." This really upsets me . . . because she likes her job too much? Because she didn't work harder? How is that gaged?
So, if, for example, a banker, REALLY LIKES BANKING . . . it's his hobby? It has it roots in the devaluation of the arts as necessity for society. (Again, I have NO idea of the type or quality of art in this case - I am just playing this out in my head.)
I worry that this sort of rational could be very detrimental to the arts as whole. So, let's say . . . you are a young stage manager with a day job . . . and I am going to show my ignorance here . . . the day job pays a majority of your income (various odd jobs) - does this mean that you can NOT deduct expenses on your stage management experiences. There are shows in NYC which might pay 300.00, but I may have costs of 350.00 to do the job properly - and the job is not taken for income as the sole reason, but because of potential future life. Is one unable to declare those expense because I enjoyed the job too much? Is someone going to come in my tech rehearsal and measure my enjoyment? (If so, I am going to act VERY miserable in tech as to not lose my tax standing).
I know the answer is to consult a tax professional, but at the end of the day, this is not the situation I am in personally.
But there are those Stage Managers who LOVE doing kooky, off-off-Broadway shows, and may not make a huge amount of money, and love their job, but with deductions and so forth, may be able to live off 20,000 a year (like the case in this article here).
Again, I don't think the article has the whole story . . . and I feel like we may have caught the overly dramatic side - and I would be interested to learn more.
But if their chief argument is "she enjoyed it too much" - then I think we have a right to upset.
The article goes about the tax law been loose and open to interpretation, but it is about intent - was there intent to make a profit - and I think that's where this case may fall apart a bit . . . that's a difficult one to prove. If you are a passive artist . . . then I think you will be on shaking ground . . . you need to show marketing, business plans, etc, etc, etc . . . and that is not clear how much of that was presented . . .
In the end, I think the moral of this story, and we as stage managers are often in a different boat then other artists, is treat your career like the business it is . . . keep great records (I know I could do better).