A Step in the Write Direction--January 26, 2015--More Tax Tips for Writers

A Step in the Write Direction

January 26, 2015

Update: Today is our youngest daughter’s 50^th birthday. Hard to believe! How quickly the years pass by. Happy birthday, Patty!…My husband has a couple of medical tests coming up—one today and one a week from tomorrow, so appreciate your prayers, as always… There's a really good FREE writers' weekly newsletter it'll pay you to subscribe to. Go to www.fundsforwriters.com It gives new markets, contests, grants, etc., and purchases one short writers' article each week. I sold them one last week titled "I'm a Caregiver! How Do I Find Time to Write?"

QUESTION: I want this blog to be yours, not all about me. I know the last couple of months have been writers’ devotions and tax tips, but now back to writers’ tips. What would YOU like to see? Do you have writing questions you’d like answered? Send them in! Also, if you enjoy receiving this blog, tell your friends. I'd like to add more to the mailing list.

Thought for Today: “Nobody reads a mystery to get to the middle. They read it to get to the end. If it’s a letdown, they won’t buy anymore. The first page sells that book. The last page sells your next book” (Mickey Spillane).

Song for Today:

If at the dawn of the early morning

He shall call us one by one,

When to the Lord we restore our talents,

Will He answer thee, “Well done”?

            Fanny J. Crosby “Will Jesus Find Us Watching?”

Laugh for Today: A highway patrolman pulled an older woman over for going too slow. “You’re only going 35 miles an hour,” he told her. “But that’s what the sign says,” she replied. “That’s the route number,” he told her, “not the speed limit.” “Oh,” she said. “No wonder the women in the backseat were screaming when I was on Route 101.”

Income Tax Deductions for Writers (miscellaneous; this is the last of the deductions. If you have any tax questions, feel free to email me at: dgood648@aol.com.)

Line 27, Other expenses. These expenses are covered in Part V, page 2, of your Schedule C and include such things as:

Conferences/courses. Note: These conferences or courses must be to “improve your skills in your present occupation,” not to learn a new one. In other words, you must show in some way—submission records, rejection letters, assignments, and so on—that you’ve been working at writing for a while and want to improve your skills. You’re not taking a course or attending a conference just to learn how to become a writer.

Permissions. Did you pay to use a quotation in a book or article? Deduct this here.

Contest fees. Any fee to enter a manuscript in a contest.

Critiquing/editing. Did you pay someone to edit your manuscript? That cost is deductible.

Postage. Until editors began accepting queries and manuscripts via e-mail, this was a writer’s biggest expense. You can buy a roll of stamps strictly for business, keep track of the expense as it happens, or invest in a postage meter.

Books/publications/tapes/CDs. As a writer, you are fortunate that almost every periodical you buy can be deducted as it is a possible market. Be honest, however, and don’t count a magazine you buy purely for entertainment without any thought of ever submitting anything to that editor. Books on writing or reference materials can be counted here, as well as tapes and CDs bought at writers’ conferences.

Printing/copies. This includes letterhead stationery (or that could also go under advertising or supplies), photocopies of manuscripts, copies of handouts for conferences, posters/postcards, and any books/booklets you self-publish.

Gifts/cards. Keep track of gifts and cards you buy for other writers, or for someone who helped you with a project or a workshop. (Right now the deductible limit for gifts per person is $25.)

Camera/film/developing. A camera you buy strictly for business can be deducted 100 percent here, or prorated if you only use it partly in your writing. Film and developing for writing-related photographs are also deducted here, along with professional photos you have taken at a studio.

Tape recorder/tapes/digital recorders. Used for interviewing purposes.

Hotel/motel. This can also go under travel, and includes any overnight trips for a conference or writing project. If you stayed extra nights for personal reasons, deduct only the nights required for business. If you took your spouse along, determine what the cost would be for one person only, and deduct only that amount unless it’s necessary for him or her to accompany you to help with your business.

Dues. This relates to dues for a writers’ association, not a club for entertainment purposes only.

Phone/Internet. At one time IRS allowed you to prorate your personal phone and take a percentage for business. Now, in order to deduct telephone expenses, you need a separate line. If you have only one line, however, you still can deduct any long-distance business calls, along with such things as Call Waiting or Conference Calling installed specifically for business. Your monthly Internet cost can also be deducted here, as well as a cell phone used mainly for business.

Bank charges. If you have a separate business account, you can deduct any monthly charges and the cost of your checks.

Office in home. This can be complicated, so I will just touch on the subject here, but suffice it to say that it must be a room or a portion of a room used only for business. The IRS can get particular on this, especially if you also have W-2 income from an outside job. Be ready to show proof if you take this deduction. If you choose to take it, keep records on such things as real estate taxes; mortgage interest; home insurance; repairs such as roof, air conditioning, heating, and plumbing; landscaping; exterminating; carpet cleaning; and so on. Figure the percentage of square feet you use for business and multiply these expenses by this percentage. You can also depreciate the business portion of your home but that’s a little too much to get into in this blog. Talk to your accountant about this.

Have a good week spreading the

gospel through the printed page.

Donna Clark Goodrich

dgood648@aol.com

www.thewritersfriend.net

http://donna-goodrich.blogspot.com

·           A Step in the Write Direction—the Complete How-to Guide for Christian Writers (with assignments throughout); original copies now on sale for half-price--$12.50, $3.17 s&h)

·          The Freedom of Letting Go (with discussion questions; can be used in S.S. class or small group); original copies without questions now on sale for half-price--$7.50, $2.69 s&h)

·          Healing in God’s Time (story of Dave Clark, composer of 25 songs that have gone to #1 on the charts); was $15; now $10, $2.69 s&h)

·          The Little Book of Big Laughs (105 purse/pocket-size book of clean jokes); up to 4 for same s&h—$2.32

·          Preparing Your Heart for Christmas (31 Advent Devotions) half-price - $5

·          Michigan and Ohio Cookbooks; half-price $5 each, plus s&h (depending on number ordered)

·          100-Plus Motivational Moments for Writers and Speakers – half-price $5, $2.69 s&h (This is free if you purchase 4 other books.)

·          Grandmother, Mother, and Me Anthology (stories, poetry, and recipes);

·          Grandfather, Father, and Me Anthology (stories, poetry, and recipes)

·          Celebrating Christmas with…Memories, Poetry, and Good Food

(above three anthologies now half price--$12.50, $3.17 s&h)

A Step in the Write Direction, January 19, 2015--More Tax Tips

A Step in the Write Direction

January 19, 2015

Update: I don’t like freeways! I’m fine once I get on them, but I always fear getting on them. While crossing the overpass, before turning onto the freeway, I always look to see how much traffic there is. If I see a lot of cars, I cringe and pray that someone will let me in. They always do. Recently, while taking the freeway out of necessity, I thought of how often my life is like that. I look ahead, think of all the possible problems that could be out there, and cringe. But every time, when I have faith, God lets me onto His highway and I can go on from there.

Thought for Today: Talent is God-given. Be humble. Fame is man-given. Be grateful. Conceit is self-given. Be careful (John Wooden).

Song for Today:

Had I a thousand tongues to sing,

The half could ne’er be told

Of love so rich, so full and free,

Of blessings manifold.

            “Let All the People Praise Thee,” Lelia N. Morris

Laugh for Today:

John’s Weather Forecasting Stone

Condition                                           Forecast

Stone is wet                                       Rain

Stone is dry                                        Not raining

Shadow on ground                           Sunny

White on top                                      Snowing

Can’t see stone                                  Foggy

Swinging stone                                  Windy

Stone jumping up and down                        Earthquake

Stone gone                                         Tornado

            (Obvious magazine)

Income Tax Tips (Schedule C continued)

Line 22, Supplies. The list is endless here: stapler/staples, paper clips, paper, envelopes, toner, pens/pencils, day planners, business card holders, software—anything you buy specifically for use in your business. I find it helps to keep two sets of these supplies—one for the family and one for your office.

Line 23, Taxes and licenses. Some states have a personal property tax for items purchased for a business. Others require a license to operate a business out of the home. Check your city’s zoning laws.

Line 24, Travel, meals, and entertainment. This line covers such things as airline tickets, rental cars, taxi fares, shuttles, and curbside baggage fees. Meals include out-of-town and overnight stays, as well as taking someone out for a business luncheon or dinner. Entertainment can include taking a client to a play, a sporting event, a concert, or another activity. Only a certain percentage of the cost for meals and entertainment is deductible, however. Any cleaning or laundry expenses while on a business trip will also be included here.

Line 25, Utilities. This is for a rented office space only. (Utilities for a home office are included on Form 8829.)

(Next week we will cover miscellaneous deductions such as postage, books/ magazines, etc.)

Have a good week spreading the

gospel through the printed page.

Donna Clark Goodrich

dgood648@aol.com

www.thewritersfriend.net

http://donna-goodrich.blogspot.com

·           A Step in the Write Direction—the Complete How-to Guide for Christian Writers (with assignments throughout); original copies now on sale for half-price--$12.50, $3.17 s&h)

·          The Freedom of Letting Go (with discussion questions; can be used in S.S. class or small group); original copies without questions now on sale for half-price--$7.50, $2.69 s&h)

·          Healing in God’s Time (story of Dave Clark, composer of 25 songs that have gone to #1 on the charts); was $15; now $10, $2.69 s&h)

·          The Little Book of Big Laughs (105 purse/pocket-size book of clean jokes); up to 4 for same s&h—$2.32

·          Preparing Your Heart for Christmas (31 Advent Devotions) half-price - $5

·          Michigan and Ohio Cookbooks; half-price $5 each, plus s&h (depending on number ordered)

·          100-Plus Motivational Moments for Writers and Speakers – half-price $5, $2.69 s&h (This is free if you purchase 4 other books.)

·          Grandmother, Mother, and Me Anthology (stories, poetry, and recipes);

·          Grandfather, Father, and Me Anthology (stories, poetry, and recipes)

·          Celebrating Christmas with…Memories, Poetry, and Good Food

(above three anthologies now half price--$12.50, $3.17 s&h)

A Step in the Write Direction--January 12, 2015--More Tax Tips for Writers

A Step in the Write Direction

January 12, 2015

Update: Great news this week: My granddaughter is being hired as a “para-pro”—an assistant teacher with special ed children, and my son-in-law is now on staff at a church just 15 miles from their home….Wives, has this happened in your home? Your husband asks you what you want to watch on TV and, to be nice, you say, “Whatever you want, dear.” So he turns on a program (that you don’t like) and then he promptly falls asleep, so you sneak over to change the channel. This reminds me of times that we tell God, “Whatever You want me to do,” and then when He calls us to a particular job, we want to sneak over and change His channel! My prayer this year is to stay with the program He chooses!

Thought for Today: “The plans of the diligent lead to profit” (Proverbs 21:5).

Song for Today:

Just when I need Him, Jesus is near.

Just when I falter, just when I fear;

Ready to help me, ready to cheer,

Just when I need Him most.

            “Just When I Need Him," William C. Poole

Laugh for Today:

My mom taught me:

 Religion: “You better pray that comes out of the carpet.”

Logic: “Because I said so, that’s why.”

Irony: “Keep crying and I’ll give you something to cry about.”

Wisdom: “When you get to my age, you’ll understand.”

Justice: “One day you’ll have kids, and I hope they turn out just like you.”

More Income Tax Tips for Writers (Schedule C):

Line 13, Depreciation. This is too complicated a subject to cover in this chapter, but basically if an item has a useful life of over a year, it can be depreciated over a period of time or, if you choose, in the first year of purchase. You will complete Form 4562 for this. (See www.irs. gov for a list of booklets concerning depreciation.)

Line 15, Insurance (other than health). This line covers insurance for a rented office space. (The prorated portion of insurance, mortgage interest, and real estate taxes for a home office is shown on Form 8829.)

Line 16, Interest. Because you can no longer take interest on personal credit cards on Schedule A, you may want to keep one credit card solely for business purchases and deduct the interest on this line. For example, if you have an airlines credit card for business travel, or an account with an office supply store, you can deduct the interest here. These cards can be in your own name or issued under the name of your business.

Line 17, Legal and professional services. Did you pay someone to prepare your taxes last year because of your writing? Did you ask someone to look over a contract? Did you need legal help to collect money due you for a writing project? Deduct this here.

Line 18, Office expense. This is not the same as office supplies. This line is for expenses for your home office or rented office and includes such things as drapes, ceiling fans, and redecorating.

Line 20, Rent or lease. This includes renting an office or business machine. However, if you rent an item and later purchase it, you need to amend this year’s return and show depreciation. You also show on this line if you rented a post office box or a safety deposit box for your business papers.

Line 21, Repairs and maintenance. This covers any repairs to your machines, as well as a maintenance agreement you purchase for a computer, copier, or printer.

Have a good week spreading the

gospel through the printed page.

Donna Clark Goodrich

dgood648@aol.com

www.thewritersfriend.net

http://donna-goodrich.blogspot.com

·           A Step in the Write Direction—the Complete How-to Guide for Christian Writers (with assignments throughout); original copies now on sale for half-price--$12.50, $3.17 s&h)

·          The Freedom of Letting Go (with discussion questions; can be used in S.S. class or small group); original copies without questions now on sale for half-price--$7.50, $2.69 s&h)

·          Healing in God’s Time (story of Dave Clark, songwriter of 25 songs that have gone to #1 on the charts); was $15; now $10, $2.69 s&h)

·          The Little Book of Big Laughs (105 purse/pocket-size book of clean jokes)--$5; up to 4 for same s&h—$2.32

·          Preparing Your Heart for Christmas (31 Advent Devotions) half-price—$5

·          Michigan and Ohio Cookbooks; half-price $5 each, plus s&h (depending on number ordered)

·          100-Plus Motivational Moments for Writers and Speakers – half-price $5, $2.69 s&h

·          Grandmother, Mother, and Me Anthology (stories, poetry, and recipes);

·          Grandfather, Father, and Me Anthology (stories, poetry, and recipes)

·          Celebrating Christmas with…Memories, Poetry, and Good Food

(above three anthologies now half price--$12.50, $3.17 s&h)

 

A Step in the Write Direction--January 5, 2015--More Tax Tips for Writers

A Step in the Write Direction

January 5, 2015

Update: I’ve been working on my Rhyme-Time Bible Stories coming out in February 2016. Originally it was 15 stories of 10-12 verses, 4 lines each. Publisher now wants them cut down to 6 verses of  4 lines each. It’s been more difficult than I thought to get the entire story across in only 6 verses, and in words preschoolers can understand. Have rewritten them twice and will take them to my faithful and honest critique group tomorrow…. Husband fell again last week in grocery store parking lot. Hurt his right hand, knee, and back, but don’t think anything is broken….Our pastor preached a good sermon yesterday on New Year’s resolutions. He asked if our resolutions were in tune with God’s Word.  “Everything that pops into your head isn’t from God,” he said. “They may be from a TV show, a magazine, a medication you’re on, or something you ate.” Interesting thought!

Thought for Today: “Your life can’t revolve around managing your stuff.…Given a choice, when Jesus returns, do I want Him to acknowledge me for a spotless house or a clean heart?” (Lisa Elliott, Come Ye Apart, 2/14/06).

Song for Today:

Riches I heed not, nor man’s empty praise,
Thou mine Inheritance, now and always:
Thou and Thou only, first in my heart,
High King of Heaven, my Treasure Thou art.

            “Be Thou My Vision,” Dallan Forgaill

Laugh for Today:

A captain told a sergeant to notify Private Smith that his grandmother had died.  "Hey, Smith, your grandma died!" the sergeant yelled into the barracks. 

"You need to learn tact," the captain said, so they sent him to Tact and Diplomacy School.  Later, the captain told him to inform Private Lopez that his grandmother had died, and he watched to see how the sergeant would handle it. 

The sergeant entered the barracks, paused at the doorway and called his men to attention.  When they were lined up, he stepped before them and ordered, "All those with living grandmothers step forward.  Not so fast, Lopez!"

Writer’s Tips:                       Tax Tips for Writers (continued)

Deductions

Below is the beginning of a list of deductions allowed on the Schedule C, with a few hints on each one.

Line 8, Advertising. This includes such things as business cards, and ads placed in newspapers or magazines offering your services as a writer, to buy or sell business equipment, or to publicize a workshop. Also include on this line books given away for advertising purposes.

Line 9, Car and truck expenses. There are two ways you can deduct your car expenses, either by deducting your mileage or using actual expenses. If the former, keep track of mileage to the post office, the office supply store, to your writers’ club or workshop, attending a business luncheon or dinner, or other business-related activities. Keep a list of places you frequent often so you don’t have to keep track each time. (MapQuest is a great help on this.) Multiply the total miles by the per-mile amount allowed by IRS, and add to this any cash amounts you paid someone to drive you to a business event. (Note: The amount IRS allows changes every year, so you need to determine the current amount for your tax year.)

If you take actual expenses, first determine the percentage you used your car for business, and multiply this percentage by what you spent on gas, oil, repairs, tags, insurance, loan interest and so on. If you choose this method (and most people don’t unless they use their auto more than 50 percent for business), you must keep all receipts.

Line 10, Commissions and fees. The only time you might use this is if you pay a percentage of your royalties to an agent for helping you sell your book, or if you pay someone a commission for helping you with a conference.

Line 11, Contract labor. Did you pay someone to type your manuscript, to do research, to transcribe tapes? The amount goes on this line. Be careful, however. If this person works on your property, uses your equipment, and has assigned hours, he or she is considered an employee, subject to withholding, not an independent contractor.

To obtain a list of tax deductions for writers, send me an e-mail.

 Have a good week spreading the

gospel through the printed page.

Donna Clark Goodrich

dgood648@aol.com

www.thewritersfriend.net

http://donna-goodrich.blogspot.com

"A Step in the Write Direction--the Complete How-to Guide for Christian Writers" (now on sale for half price-- $12.50, plus $3 s&h). This book has a whole chapter on income taxes for writers.