|
The Shy Writer: An
Introvert's Guide to Writing Success - trade paperback and ebook -
TOTAL FFW subscription with paperback purchase.
|
Our newsletters are delivered via Aweber.com, a
reliable, spam-free newsletter service. Click above and tell them Hope sent you.
The delivery service Hope
has used for years for her ebooks.
This website hosted by GoDaddy. Best online values I've
found for hosting & domain registration. Click here to learn more.
Your ad placed here. See the
Ad Rates page for both
the web site and newsletter rates.
Contests, grants, markets that
pay writers may list at no charge. Send to
Hope.
| |
What Your Tax Preparer Wants to See From You
By Thursday Bram
Tax season is more complicated for writers than for anyone who
relies on just one employer for income. To get your taxes done,
you need more than just a W-2 — your tax preparer will have a
whole list of documents he'll need in order to complete your
income tax return.
Form 1099
According to the IRS, each of your clients should send you a
Form 1099 that lists the amount of money you received from
that client in the last year. You should receive your copy of
your Form 1099 by the beginning of March. The IRS will also
receive a copy of each Form 1099.
Invoice Totals
In addition to the forms from your clients, your tax preparer
will need a list of your clients and the amount you received
from each. There are many situations in which you will not
receive a Form 1099 for the work you've completed: if you work
with an international client, the client becomes defunct or
even if your client sent you an incorrect Form 1099. Sometimes
your client may just not issue a Form 1099 at all. Some
businesses do not issue a Form 1099 to any freelancer who
earns less than $600 over the course of the year.
Expenses
As a writer, you can deduct expenses related to your work.
In order to do so, your tax preparer will need information
about your expenses over the course of the year. Most of the
time, your tax preparer won't ask you to bring in all the
receipts — although it's worthwhile to hold on to those
receipts in case of an audit — instead, you'll need the total
you've spent, as well as a breakdown of where that money went.
If you've bought office supplies, paid for Internet access or
even taken a client out to lunch, you have expenses that you
can deduct in part or in whole on your taxes. You can even
write off big expenses, like a new computer, although the
deduction is usually divided across several years. By reporting
the depreciation of your equipment, you can spread its cost
over the length of time you use it.
To claim the home office deduction, your tax preparer will
need to know the size of your home office, as well as the
size of your entire home. The deduction is calculated by
determining the percentage of your home dedicated to business
use and then using that percentage to calculate the portion of
your utility bills, taxes and insurance that can be considered
a business expense.
Quarterly Estimated Taxes
Because your clients do not withhold payroll taxes when they
send you a check, the IRS may expect you to send in your taxes
quarterly. If you freelance on the side, your withholding at
your job can be adjusted to cover the taxes on your freelance
income. Similarly, if your income is low and you will be
filing a joint return with someone who does have taxes withheld
from his or her paycheck, you may have such a low tax burden
that you do not need to complete the form. However, if you
expect to owe at least $1,000 in taxes on your freelancing
income, the IRS does expect you to pay estimated taxes. If you
have submitted quarterly income tax payments, your tax preparer
needs a copy of your Form 1040-ES, including each quarter's
section showing that you've sent in your payment.
Personal Records
Beyond your business records, you may need to provide
information about your personal finances. If, for instance,
you're setting aside money towards retirement in an IRA, your
tax preparer will need information about that account. The same
goes for claiming deductions and credits related to purchasing
a new home, attending college, paying medical bills or making
donations.
Talk to Your Tax Preparer
By now, you may have a big stack of paper. However, if you've
been keeping good financial records over the course of the last
year, you may be able to just send your tax preparer a
spreadsheet.
Because everyone's tax situation is different, this list may
not cover everything your tax preparer needs to handle your
taxes. It's important to consult a tax professional about the
specifics of your income and expenses — and most tax preparers
will make a point of going over the list of documents they'll
need with you.
Bio:
Thursday Bram writes about small business and personal finance
topics. Her ebook, "Market Your Freelance Writing in 31 Days,"
is available through Thursday's website,
ThursdayBram.com, where
she also blogs about the business side of freelance writing.
| |
|
Follow FundsforWriters
on Social Network Media:
|
 Tweetebooks!
Mini-ebooks of niche markets for $1.99.
|
High Hope for the Freelance Writer