>Time to count the moneyPosted: December 29, 2009
>This year is almost over. That means it’s time to do some math. My husband used to be a licensed tax preparer, so I got used to him nagging me about my accounting. Now it’s my turn to nag you. If you have not been keeping track of your income and expenses for your writing business, resolve to start on Jan. 1. Not only are you legally obligated to report your income, but you can deduct most of your writing-related expenses on your tax return, offsetting other income you might have. Go to IRS.gov, look up Schedule C and start figuring out what you need to fill in the blanks. Even if you don’t make money, you can claim your freelance expenses as long as you can prove that you are making an effort to sell your work.
It doesn’t matter whether you do your accounting in an old-fashioned ledger book, in a computer program like Quicken or on a spreadsheet as long as you keep track of it somewhere. Deductible expenses include: office supplies, postage, Internet expenses, contest fees, long-distance phone calls, mileage, travel expenses if related to your writing, organization memberships, classes, books, newspapers, computers, cameras, and more. Trying to recreate these expenses at the end of the year is nearly impossible, but if you chart your expenses as you go, it will be easy to add them up.
Not only do good financial records help you with your tax return, but they give you a clear picture of how you did over the year in terms of marketing and making money. You can see what cost more than it was worth and what worked well. It’s a good New Year’s Day project.
New Year’s is also a good time to set goals. What steps do you need to take to get to where you want to be a year from now? Start taking those steps right away. That’s my plan. Will you join me?