A Massage Therapist’s Tax Season Guide: An Interview with a CPA

Tax season is right around the corner, and with it comes laboring over numbers and forms. But doing your taxes doesn't have to be a painful process.

We sat down with Certified Public Accountant Larry Marietta of Marietta Financial Services, Inc. to find out everything you as a massage therapist need to know this tax season.

APM: Hi Larry! Thanks for meeting with us.

Larry: My pleasure.

APM: Okay, let's get down to business. What question do you get asked the most about doing taxes?

Larry: What everyone wants to know is, "What's deductible?" The simple answer is, "Did you use it for business? If so, it's probably deductible. If not, then no."When people - massage therapists included - go into business for themselves, they have to change the way they think. They're not used to thinking that the business is its own world.

APM: So what does it look like to make your business its own world?

Larry: First, it needs its own checking account with a checkbook for your business only. Secondly, you need a filing system. I don't care what that filing system is, but you need one that you can refer back to if you need to find documentation later. If you get audited, you have to go back 3 years. If you don't have a good system, you won't be able to find those documents. Buy a folder that has January-December month tabs on it. I don’t care how organized it is, just be sure your documents are in the file.

APM: So, what is deductible?

Larry: Anything you bought for the business: oils, sheets, tables. The hard part is when you co-mingle items. For example, can you deduct the new washing machine you bought to wash your massage therapy sheets? Well, yes. But if it's in your home and you also use it to wash your own clothes and sheets, that's when it gets a little sticky. Same for people's cell phones, etc.

APM: Are there deductions massage therapists may not realize they can take?

Larry: Mileage to and from massages is a big one. Even lunches out with their massage therapist friends to discuss the latest techniques. Or they can write off flights and meals to and from a conference in Florida this winter. That's where they can take advantage of the deductions as long as they make use of their filing system.

APM: If a massage therapist is filing their taxes for the first time as a small business owner, what advice do you have for them?

Larry: Go to a CPA who specializes in small business owners' taxes.

APM: If a massage therapist wants to do their own taxes, are there software programs out there that you recommend?

Larry: I've never used any firsthand, but I've heard of Intuit and TurboTax as large vendors. I think they do a reasonably good job or interviewing you enough to capture everything. But the problem is that it will most likely cost you more money to do it yourself than to pay someone else to do it since they will be able to recognize any money you have have left on the table.

APM: What are issues that massage therapists may get caught up with?

Larry: Report your cash. If you're not going to report things accurately, your'e going to get yourself into a pickle which will be a disservice to your business. So I always recommend being honest.

APM: Any other advice you have for massage therapists out there?

Larry: If you are a new business owner, market, market, market! 90% of new businesses fail in the first 3 years. It takes 3 years to get enough momentu to generate clients without you generating them all yourself. Also, develop good bookkeeping habits.

APM: Thank you so much for your time and sharing your wisdom with us. If any of our massage therapists have questions or need help with their taxes, can they call you?

Larry: I'm happy to help.

Larry Marietta is a CPA and owner of Marietta Financial Services in Indianapolis, Indiana, where they strive to deliver value and plan for success.