In choosing to become a live freelance audio engineer, the choice is not only a career decision, but a lifestyle choice as well. All jobs dictate a certain lifestyle, but along with the required skills, the life of a live audio engineer has specific parameters that need to be met by particular personality traits. Some of these traits encompass having an artistic bent, desiring a less-than-conventional life, enjoying new challenges with a variety of people and being a bit nomadic. Of course, this could describe most people and jobs in the entertainment business, but for now, I’ll stick with the audio professionals.
Fortunately, the audio business is not a one size fits all, and while there are those who are on the road, there are others who counter that life by being a house engineer in a venue or theater. Also, with the advent of more live sound for television, there are positions open in that field as well. The lure of the road is compelling for someone with the need for adventure, and while I know quite a few engineers still plying their trade on the road, I know just as many who have stopped touring to take a steady gig in theater, television or a local venue. Regardless of the medium, the hours are usually not the standard 9-5 and the work may not be on a steady five-day schedule; when the work is there, it is usually during the holidays when everyone else is off.
Navigating oneself through the freelance world can be challenging — to say the least — and it becomes especially so when one has a family. While many tours pay well, there isn’t necessarily any job security when working for a particular artist or tour. Once the tour is over, engineers have to draw on their own resources if they plan to keep making a paycheck until the next tour calls. During the first three months of every year, I start hearing from my touring friends as they call to let me know they’re available for work. Unfortunately, the work is usually as scarce for me as it is for them, and I put them on the list of engineers I can call. Of course, since we are all dealing with the same business, so by the time work is picking up for me, it will be the same time for them.
Touring is great and fun for the adventurous, but when that tour ends, it’s best if the engineer has something to return to while looking for the next tour. A house gig working for a venue, or a shop gig employed by an audio company come to mind. Networking helps, and while that one call may not receive an immediate response, it may prove fruitful down the line. Being freelance gives one the freedom of not being tethered to the same job day in and day out, but constantly being on the lookout for work can be taxing.
Dollars… Taxes!
Speaking of taxes, it’s that time of year, and for anyone doing freelance work, it’s important to know what is financially expected of you regarding taxes. If one is not considered a full-time employee, there is a good possibility that their employer does not withhold taxes from their paychecks. As a freelancer, if one makes any income over $400, it must be reported to the government. The IRS defines a full-time employee as someone who works a minimum of 30 hours per week or 130 hours per month. Therefore, if you are on a long-term tour, your employer may take the required taxes from your paycheck every week, but if it is a limited engagement, they may not, which puts the tax burden on the freelancer.
As a self-employed taxpayer, one is responsible for paying into the Federal Insurance Contribution Act (FICA), otherwise known as Medicare and Social Security. When one works for an employer, the employer pays half of the employee’s required Social Security (6.2%) and Medicare (1.5%). As an independent contractor, one is considered an employer as well as an employee, which means that the freelancer is responsible for the full payment of 15.3% FICA tax. There are also federal, state and local taxes that need to be paid, and depending upon one’s earnings, this can range from 10% of taxable income up to 37% of the income.
The good news? As a freelancer, one can deduct a fair amount of their expenses — such as a home office, meals, travel (including mileage), insurance, phone, internet and tools for work such as your Leatherman or Waves files. As a freelancer, it’s suggested that one should put aside 30% of their income to prepare for taxes, as freelance taxes are due on a quarterly basis and due on, April 15, June 15, Sept. 15 and Jan. 15. It is also suggested that one contributes up to 10% of their income to an IRA or 401K plan considering that, as freelancer, there will be no other pension plan for later in life.
In a perfect world, these are all good suggestions but, in our less-than-perfect world, these expenses seem insurmountable since one is — more often than not — just getting by on what they are making. As the individual is acting as a business entity, it might be a good idea to actually structure the freelance into an LLC or an “S” corporation, depending upon the income and nature of the business.
One of the plus sides to having a formal business structure is that it can protect one’s personal finance in case the business is sued. For example, an engineer gets hired for a job and they bring equipment that scratches the venue’s pristine floors. The client sues, but the engineer’s personal finances are safe since the business is liable and not the individual. Regardless of how a freelance business is structured, it’s probably a good idea to find a good accountant to help steer one in the right direction and avoid wrecking on the rocky shores of the IRS.
Note: As April 15 falls on a Saturday this year, and April 17 is observed as Emancipation Day in Washington, D.C. (where the IRS is located), you have until Tuesday, April 18, 2023 to file your 2022 taxes without an extension.
