Before you snore, let’s get the nastiness out of the way first. I’m getting my tax things ready for the accountant, so my mind is on records. You must keep good records. What do I record, you ask? Simple. Income, Expenses, and Writing Time. I know, you already run a household, manage your family, and have a ton of things to keep track of. Sorry to add to your burden, but next to writing the very best stories ever, this ranks right up there in the top three.
There are variables to these three things depending on whether you write full time, or if you write part-time and work a full time job in another industry. The reason being, if you have a full time job in another industry, you must be ready to prove, tax-wise, that your writing is a ‘job’ not a hobby. Good record keeping will help with that.
There are several ways to handle business records. The really non-negotiable part is that you keep track of things. How you do it, will be up to you. Just be sure you do it.
If you are a new writer, start simple. A spreadsheet will work fine. If you are a more established writer, with a back list and more substantial income/expenses, a simple program like Quicken will work. You’ll also want a place to file paperwork. File folders, an expandable file, or one drawer in a file a cabinet.
As forward reaching as the writing industry is becoming, with the advent of ebooks, electronic submissions, etc., the business end still comes with a butt-load of paper.
One more thing, while your eyes are still barely open...if you don’t have one, you’ll need to find an accountant, CPA, or tax professional you trust, to turn to for taxes at the end of the year, and for questions during the year. I cannot stress this strongly enough. I’m not saying run out right now and hire somebody, but use some common sense here. It’s better to know them, and have a working relationship with them, before you need them for something really important. Like that six-figure advance, and what to do with it. And let’s not forget the taxes that will be imposed upon it.
Next post, we’ll explore what to do with the three categories mentioned above. Income, expenses and writing time.