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    Tax Tips for Authors 2014
    Tax Tips for Authors 2014
    Tax Tips for Authors 2014
    Ebook119 pages1 hour

    Tax Tips for Authors 2014

    By EM Lynley

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    About this ebook

    Updated for 2013 tax returns, including the new method for calculating home-office deductions and an expanded chapter for self-publishers!

    Authors, are you stymied by Schedule C and self-employment tax? Not sure you're getting all the deductions you deserve, or uncertain precisely what the IRS allows? This book is a compilation of a 10-lecture online course offered each spring for authors, focusing on exactly what you need to know to file your tax return accurately, and with the most comprehensive deductions list for writers, published or not. As an author and a tax preparer, we can offer expert knowledge that usually costs hundreds of dollars in tax prep fees.

    Chapters include:
    Legal Issues: Licenses, Company Structure, EIN
    Hobby vs. Business
    How to Tackle the Schedule C, Part I
    Schedule C Part II: What Expenses Are Deductible?
    Home Office Deduction
    Self-Employment Tax
    Quarterly Estimated Payments
    Unpublished Authors
    FAQ

    LanguageEnglish
    PublisherSilk Road Press
    Release dateApr 9, 2013
    ISBN9781301200856
    Tax Tips for Authors 2014
    Author

    EM Lynley

    EM Lynley, a Rainbow Award winner and EPPIE finalist, has worked in high finance, high tech, and in the wine industry, though she'd rather be writing hot, romantic man-on-man action. She spent 10 years as an economist and financial analyst, including a year as a White House Staff Economist, but only because all the intern positions were filled. Tired of boring herself and others with dry business reports and articles, her creative muse is back and naughtier than ever. She has lived and worked in London, Tokyo and Washington, D.C., but the San Francisco Bay Area is home for now. She is the author of Sex, Lies & Wedding Bells, the Precious Gems series from Dreamspinner Press, and the Rewriting History series starring a sexy jewel thief, among others. Visit her online at www.emlynley.com

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      Book preview

      Tax Tips for Authors 2014 - EM Lynley

      Tax Tips for Authors

      by a Writer and

      Tax Professional

      N. S. Smith

      with EM Lynley

      Published by Silk Road Press &

      Rocky Ridge Books

      Copyright 2014 N. S. Smith and EM Lynley

      Third edition, February 2014

      Smashwords edition

      The scanning, uploading and distribution of this book via the Internet or via any other means without the permission of the author is illegal, and punishable by law. Please purchase only authorized electronic editions, and do not participate in or encourage the electronic piracy of copyrighted materials. Your support of the author’s rights is appreciated.

      All rights reserved. No part of this book may be reproduced in whole or in part without written permission from the author, except by reviewers who may quote brief excerpts in connection with a review.

      ISBN: 978-1-62622-009-6   

      Table of Contents

      Title Page

      Updated for 2013 Tax Returns

      Introduction

      Who is this book for?

      Important Disclaimer

      Chapter 1: General Legal Issues

      Chapter 2: Hobby vs. Business

      The Hobby-Loss Rule

      When Do You Want Be Considered a Hobby?

      Chapter 3: Recordkeeping Basics

      Chapter 4: Tackling the Schedule C

      Box A through J

      Part I: Income

      Part III: Cost of Goods Sold

      Chapter 5: Schedule C Part II: Expenses

      What Expenses Are Deductible?

      Start-Up Expenses

      Operating Expenses

      Capital Expenses

      Inventory

      Chapter 6: Deducting Expenses on Schedule C

      Lines 8-17

      Lines 18-27b

      Final Calculations

      Chapter 7: Home Office Deduction

      Qualifying Home Office

      Using the Simplified Method

      Calculating the Deduction Old School

      Chapter 8: Self-Employment Tax

      Special SE Situations

      Chapter 9: Quarterly Estimated Payments

      How to Calculate Quarterly Taxes

      When to File Estimated Taxes

      Where to Get Estimated Tax Forms

      Chapter 10: Unpublished Authors

      Chapter 11: Self-Published Authors

      FAQ

      Ask a Question

      Where to Get Tax Forms

      About the Authors

      Other Titles by EM Lynley

      Updated for 2013 Tax Returns

      This January 2014 Third Edition contains all-new material and the most recent relevant tax-law changes, including the new simplified method of calculating the home-office deduction.

      Smaller updates may occur between now and the 2015 Edition. If you would like to be informed of updated information, please consider subscribing to the Tax Tips for Authors Newsletter.

      Introduction

      This book is a compilation of lectures and additional information used in my online tax courses for authors in the United States. It is not intended to be an extensive or exhaustive volume on small-business taxes or general tax concepts. It’s short, concise information that is of the most use to writers preparing their own tax returns. This book is not filled with lots of long-winded stories about clients to fill word count and add pages. You don’t have time to read all that. You probably just want to know how to fill in your forms and what you can and can’t deduct. I will answer those questions, as well as provide additional useful and necessary information.

      Contact us at the blog: Tax Tips for Authors: (http://taxtips.emlynley.com or http://www.facebook.com/taxtipsforauthors)

      Who is this book for?

      Most writers, at least novelists, probably consider themselves left-brain types, more interested in words and ideas than in numbers and analytics. I happen to be an exception to that, starting out in science and engineering and moving into finance. (Physics and finance use the same math techniques). I’ve always been a numbers person and do freelance financial writing in addition to writing novels. I thought it would be useful to present some important tax issues from the perspective of a writer, for writers, using my own knowledge and experience as a financial professional and a tax preparer.

      For those of you who do not know me, I write erotic romance, but during tax season I work as a tax preparer as well as for some private clients—mainly authors. I prepare my own taxes, including those for my writing business, and have been doing so since before I took a basic tax class at H&R Block. I am licensed in the state of California, which allows me to work as a paid tax preparer in California, though I can file any federal tax return and returns for nearly any state.

      Since writers usually don’t enjoy preparing their taxes, we tend to put off even thinking about them until the last minute. While you have until April 17 this year, due to a holiday, it’s a good idea to think about your writing business from a tax perspective all year long, especially in regard to keeping track of what you spent. It also makes preparing your taxes a snap when all the information is readily available.

      This book will cover mainly federal tax issues for two reasons:

      the majority of states use the federal adjusted gross income (AGI) from your 1040 as the starting point, so deductions allowed at the federal level carry through to the state tax return; and

      I do not have detailed knowledge about other states besides California. If you have a specific state-related question, I can steer you in the direction of an answer, but I won’t claim to be an expert about your state.

      Can’t I just do this myself?

      Why do I need to read your book or take one of your courses? My software will do this all for me.

      This is the biggest question I get when I prepare taxes for clients. Invariably, they tell me I asked more questions and found more deductions for them than they would have on their own. I will let you know that having a tax professional prepare your 1040 with Schedule C can run around $400, depending on the type of expenses you claim.

      You certainly can do it yourself with tax software, but after you read this book, you’ll have a lot more knowledge about what you can and cannot deduct, and why the software is asking some of those questions. You may also discover a few things you didn’t know you could write off, which will help you lower your taxes, or avoid making costly mistakes that can trigger an audit.

      Important Disclaimer

      While I am licensed in California and bonded, this book is not intended to be the sole source of information in preparing your taxes, nor does it imply a client relationship between myself and any reader.

      The information contained in this book is provided for informational purposes only, and should not be construed as legal advice on any subject matter. No recipients of content from this site, clients or otherwise, should act or refrain from acting on the basis of any content included in the site without taking into account or seeking appropriate tax advice on the particular facts and circumstances at issue for their financial situation. This book contains general information and may not reflect current legal developments, verdicts or settlements.

      TO ENSURE COMPLIANCE WITH INTERNAL REVENUE SERVICE CIRCULAR 230, ANY U.S. FEDERAL TAX ADVICE CONTAINED IN THIS BOOK IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, FOR THE PURPOSE OF (1) AVOIDING

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