Book Review: Tax Tips For Writers
Did you know the gas you used driving back and forth to the post office to mail out your manuscripts could be deducted from your taxes? Neither did I. Elizabeth Klungness, list member and author, was gracious enough to send me a review copy of her book, Tax Tips for Writers. By the end of this book, I realized I had one major problem with it: I hadn't discovered it years ago. Klungness draws on her experiences as an IRS agent, accountant, and writer to create a comprehensive guide for writers. Even if you've never made a profit on your writing, this book is for you. It clearly outlines what you can claim on your taxes, and provides worksheets to assist you in keeping records that will withstand any audit. Simply written, it packs a wealth of easy to understand information into just over 50 pages, saving you from wading through pages and pages of text to find the information you need. The only negative I found was the omission of Internet services. Those of us who spend hours and hours online reasearching, networking, and participating in writer's groups would love to know how to deduct it from our taxes. Updated annually, Tax Tips sells for $12.95 plus $1.55 shipping and handling. It can be ordered directly from the Tower Enterprises website or by snail mail: 2130 Sunset Dr. #47, Vista, CA 92083. I highly recommend this book to anyone who calls themself a writer, whether published or not. For more information, e-mail Elizabeth Klungness
A Few Tips From Elizabeth Klungness....
Elizabeth agreed to furnish a few tips for the site visitors. New ones will be added every week or so until after the first of the year so check back often for the newest tips!
TIP: In addition to going Christmas shopping for the kids, the parents, the
neighbors, the dog, remember to shop for yourself. I'll bet you haven't
considered that greenery, the pine-scented candles, the incense you
enjoy, as deductions on your income tax. They are, you know, if you
can relate them in any way to your current writing. For example, I buy
pine-scented candles because I am working on a story set in the
Northwest. The same is true of the expensive Christmas wreath I just
bought because there is no greenery available here in my part of
Southern CA. You needn't pay cash. A charge is an obligation to pay and
considered a deductible expense in the year you charge it.
TIP: While your kids are home on vacation, give some thought to furniture
moving. What has that to do with taxes? Don't you have some antique
table you inherited from Aunt Minnie stored away--one that you know is
worth a few bucks? If you have an appraised value, or can get an
approximate value from someone who knows antiques, move it into your
office area. Even if you can't claim a home office because you have a
loss, you can depreciate the table if you use it for your writing
business. You can always stack computer paper on it, or store those
magazines you intend to clip. Maybe it's a magazine rack, or an old
upright radio. You know the family would disown you if you sold the
thing so why not get some value from it and reduce the taxes you owe.
As long as we are talking about depreciation, don't forget, books such
as Writer's Market don't have to be depreciated over three years. They
can be expensed in the year of purchase since they must be replaced each
year. Remember to claim the cost of your daily newspaper. That's where
you find the ideas for those articles and short stories, right?
TIP: Don't forget on December 31 to write down the odometer reading on
the car you use to go to the post office, the bookstore, the office
supply place, etc. You'll need that figure to determine what percentage
of the car's use is for your writing business. If your vehicle is in
need of a lube job, take the time to do it near the end of the year.
The garage you go to will write the mileage and date on the work copy.
This will give you substantiation for the mileage figure you use to
determine total 1998 miles driven and to start the year 1999.
I prefer to use the standard mileage deduction since I drive a small
Honda. You can deduct 32.5 cents a mile for 1998. If you have a gas
guzzler, lots of repairs, you may want to go actual auto expenses, but
there are a number of rules that apply. You had best check them out
before going that route.
TIP: Some of us don't have enough interest on our houses or medical bills to
itemize deductions on Schedule A so we claim the standard deduction.
Don't confuse that with the writing expenses you incur and think you
cannot file Schedule C because you don't have enough expenses to
itemize. They are like apples and oranges. The one personal, the other
business.
If you don't itemize deductions and can't claim your contributions for
that reason, consider in 1999 taking an ad in the church bulletin for
something connected with your writing business. It will be deductible
to you as an advertising expense, and a benefit to the church or
whatever organization where you place the ad, and serve just as well as
the contribution you were considering giving to that organization.
TIP: Don't forget to include the amounts you charged on your last month's
credit cards that pertain to your writing business. It doesn't matter
that you didn't pay them off in 1998. Even if you are a cash-basis
taxpayer, and most of us are, when that debt is incurred is the date
used. Why? Well, because it's as if you borrowed cash from your
grandmother and bought something. Not that credit card companies are as
friendly as grandmothers, well, some grandmothers, but you know what I
mean. Include it!