What is Income

• The first challenge you face is determining the correct amount of income to report on your tax return. As a traveling comedian, you earn money by performing at venues around the country. Whether you receive a fixed fee or a percentage of ticket sales, you are likely to receive varying amounts. The total of all payments you receive during the year is the income that is subject to income tax.
  
  

Hotels

• Because you are considered a business, the IRS will allow you to reduce that income by all expenses that relate to the business. If you frequently travel, hotel charges are likely to be one of your largest expenses. Your hotels are fully deductible as long as it is necessary for you to stay overnight in order to perform. For example, if the comedy club you are performing at is 5 miles from your home, think twice before spending money on a hotel because the IRS will disallow it. Also be aware that the IRS does not allow you to overindulge at taxpayers' expense. So when you book the hotel, avoid five-star resorts.
  
  

Transportation

• The costs you incur traveling to each performance venue is likely to rival your hotel charges as the largest expense. You can also use these costs to reduce the amount of your income that is subject to income tax. The deduction includes both local and long-distance travel. You can write off airline and train tickets, rental car charges and gas, taxis and any other reasonable means of transportation. Be aware, though, that the deduction does not always include the transportation costs once you arrive at the destination. For example, if you arrive early to your destination and decide to take a cab to tour the city after checking into your hotel, you cannot deduct the cost. Once you are done sightseeing, you can, however, deduct the cost of getting to the comedy club where you are performing.
  
  

Tax Returns

• As a one-man show, chances are you will file a tax return with a Schedule C attachment. The Schedule C attachment is used by sole proprietors to separately report business earnings and deductions. It is on this form that you will report all performance income and the related deductions to calculate your taxable business earnings. You then must include this amount on your personal tax return along with other income you may receive during the year that does not relate to performing.