Monday, March 6, 2017

Writers & Taxes

by Alycia W. Morales     @AlyciaMorales

I'm a writer, not an accountant. I want to clarify that up front. But since writers have to do taxes, I know a few things about keeping receipts and what I can claim as part of my business. So here is a short list of things writers will want to track for tax purposes (and it's by no means all-inclusive).

When writers attend conferences, purchase online courses, or pay for a local workshop, it's a tax write-off.

When writers travel to and from conferences, meetings, retreats, and critique group, they can keep track of their mileage, save receipts for airfare, hotel, and any transportation they must use during the conference. I use Google Maps to track my mileage. I save my receipt for the airport parking (that's a write-off too), the coffee shop where my critique group meets, etc. Then I Google Map the distance between my house and the destination and keep a spreadsheet of the dates, where I traveled to, for what purpose, and the round-trip mileage.

If you eat while at a conference or during a meeting, you can save your receipts for the cost of the food (this is also proof you were where you said you were). Food write-offs are usually a percentage, not full cost.

Do you love learning about writing? Buy a lot of books about writing? Or reference material? Writing magazines? Those are a write-off as well. But literature (the fiction novels and nonfiction reads) you enjoy is not a write-off.

Do you rent an office space specifically for your writing business? Have a room in your house that is a dedicated office? Ask your accountant how to write off the cost of having that space. (Understand that nothing except work can happen in that space.)

If you have such a space, then some portion of your electric bill, internet service, and phone may be written off too. Again, ask your accountant about this.

Did you buy a new laptop, desktop, camera, or tablet this year? Do you do a lot of business (blogging, writing, editing, etc.) on the electronic device you purchased? That's a write-off too.

What about programs such as Microsoft Office 365 or Scrivener? Yep. They qualify too. Do you pay for Dropbox, PicMonkey, MailChimp, or any other online service? Those can be written off as well.

These are just a few things that are tax deductions for the writer. As I said, I'm not an accountant, so please discuss any questions with yours. If you're new to the writing industry, these are simply things to consider as you move forward in your writing career.

Do you have anything else to add to the list? Feel free to add to it in the comments below. And don't forget to make that appointment with your accountant before April 15!

Tweetables:

A few tax pointers for #writers. {Click to Tweet}
 
What can #writers write off on their taxes? {Click to Tweet}

10 comments:

  1. Great info, Alycia. And timely. I am also allowed to claim fees paid for services like Carbonite (back-up), and dues/fees for professional organizations. Even something as simple as postage can be counted as long as it is directly related to writing/editing.

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    1. Yes! Those are other things I write off too.

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  2. Thank you! Just last week I thought how nice it would be for someone to do a tax workshop at one of our conferences. I saved most of my receipts automatically because I purchase online through Paypal or my bank. Last year was my first year having to do my own taxes and I learned a lot of what I should have done regarding medical expenses. This is my year to figure out what I can claim for my writing. You've jump-started my journey.

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    1. There's quite a bit we can claim as writers. I'm glad I could help, Karen!

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    2. (And if you need someone to do a workshop, feel free to contact me. I'm not an accountant, but I have been filing for my business enough years to know what can be claimed and what can't.)

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  3. I'm so glad you posted this! One of our authors asked me to put something like in my weekly newsletter for LPC. Mind if I send this blog post to all of our authors? Thanks!

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    1. Yes, Marcie! Feel free to share! Thanks!

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  4. Awesome, Alycia. I'll pass that information along to the powers that be here in Atlanta.

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  5. Did you open an LLC or other corporate structure (state designated) in order to claim these expenses? I live in Florida.

    How do you handle your book sales income? Is it reported as income on your personal taxes or under your LLC or whatever structure you use? Presumably you have a separate checking account for your writing career?

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    1. Hi Sharon! Those are great questions. The answers will probably vary from state to state, so I highly recommend you check with your accountant for answers for Florida.

      I live in South Carolina, where I'm not required to open an LLC to be a writer/editor or to claim my expenses.

      I don't have any book sales, as I don't have my own novels yet (but I do have publishing credentials). If I did have book sales, they would be claimed as business income (not personal income). Everything I do for my business is run through my separate checking account created specifically for my business. I move money out of that account into my household account as my personal income. I know several of my writing friends do the same thing.

      Some of them do have LLCs. But as I said before, it's not required in South Carolina. At least not at the tax bracket I'm currently in.

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