I hope you had a great Christmas and enjoyed the fellowship and gift exchanges with family and friends! Now that Christmas is over, in a few more days we’ll be celebrating a new year, which means it won’t be long until we self-employed folks have to fork over some of our earnings to Uncle Sam. With that in mind, I thought I would let you know how I manage my business expenses. Hopefully, sharing this advice will help you give as little as possible to Uncle Sam and keep your writing business more organized in 2011 and the years to follow.
Business Expenses Writers Can Claim
As long as our yearly investments had to do with our writing business, we can pretty much claim them. Some of the things I claim that you can as well include:
- Mileage for any travel related to a writing job.
- Any equipment bought for writing (laptop, computer, printer, fax, digital camera, flash drive, etc.).
- Telephone expenses for interviews, research and fact-checking
- Supplies (printer paper, ink cartridges, etc.).
- Charitable contributions.
- Books that are bought to help learn more about the industry.
- Advertising expenses.
- Insurance expenses.
- Postage expenses.
- Fees paid to Paypal and oDesk.
Visit the IRS website for additional information on other expenses freelancers may be able to claim.
Organizing Business Expenses
Paying taxes is already a headache, but it can be even more painful when you start scrambling to find all those important documents at the end of each year. If you want to keep your headache from getting bigger, continue reading for some organizational advice that will make your life much easier next time tax time rolls around.
- Keep receipts of everything you buy (online and offline) related to your writing business.
- Keep a record of all business expenses. The easiest way to do this is to create a spreadsheet with four columns: purchase date (date you made the purchase), amount spent (how much you paid), what (the name of the product or service you bought) and for (what the item, service or etc. was bought for).
- File all receipts in a folder labeled business expense receipts or something similar.
I hope you found my tips helpful, and I invite you to use the comments area to share any additional advice you have that will help writers when it comes to managing business expenses.
Until next time, have a happy, safe, blessed and prosperous New Year!