by Danica Favorite
One of the things I teach in my Taxes for Writers class is that the IRS is going to look at your business as a business, and many writers need to work on making their writing business more business-like. Yes, I know, writers tend to be more creative and would rather spend their time deciding if their heroine’s horse should be named Petunia or Patience. But we need to remember that our writing is a business.
Here are three simple things you can do to make your writing business more business-like:
1. Write a business plan.
Those who have worked in the corporate world know that a business plan can be pretty complicated. But writers can do something more simple. For example, what are your writing goals for the year? Maybe you can’t control how many contracts you get, but you can control how many books you write, what you do to market your books, and how many queries you send out each year. Write these goals down and use them as a guide for your writing business.
2. Set a schedule for your writing and stick to it.
A business owner would never hire an employee to work whenever he or she felt like it. The same should go for your writing business. Commit to times when you will write and put it in your schedule. You’d never dream of missing work because your aunt Trudy wanted to go to lunch, so don’t skimp on your writing time, either. Keep track of your writing time and schedule. Some writers do this in a spreadsheet, and there are also a lot of great time-tracking software programs out there. Not only will it help prove to the IRS that you have a business, but it also will help you see where you’re spending your time and how you can use it more efficiently.
3. Keep good records.
Just like in a traditional business, you should have good records for your writing. In addition to your writing schedule above, you should be keeping track of income and expenses for your taxes. Many people use specialized software programs, but you can also use a simple spreadsheet. And, for those who are tech challenged, you can even do this on paper. The point is to make sure everything is together in an easy to understand format. For IRS purposes, it’s always better to err on the side of having too much information than not enough to prove your writing-related deductions.
While this isn’t an all-inclusive list of things you can do to make your writing business more business-like, it’s a great start. The more seriously you treat your writing as a business, the more respect it will get for being a business instead of a hobby. It’s not nearly as much fun as figuring out what kind of horse your heroine has, but it will definitely save you at tax time.
Danica Favorite works as an online moderator for a major publisher where she connects readers and writers with new fiction releases. Having spent time in the corporate world teaching tax law and preparing taxes, she much prefers fiction to numbers.