Even Death can't cheat taxes. |
Any money you spend as part of your profession can be claimed as a tax deduction.
Any Money, You Say?
Within reason, yes. You probably can't get away with calling your new tattoos a career expense (no matter how cool the font is), but there are a slew of expenses you probably aren't thinking about that are perfectly legal for you to claim as an author that could strip hundreds or even thousands of dollars off of your gross income before you pay your taxes. For instance...
Your Bills
Everyone has bills to pay; it's why we do what we do. However if the services you're paying for are a necessity for your career then that makes them a business expense. For example, say you were a reporter. As a reporter you need to have a smartphone capable of taking pictures, shooting video, and browsing the Internet. You need to be able to call from the field in order to get hold of your editor. As such at least a portion of your cell phone bill, and often the cost of a cell phone upgrade, can be deducted as part of your job.
You know you've been eyeing that new model. |
As another example, say you were a blogger. Writing blogs is where your money comes from, and you can't do it without Internet access. Therefore at least a portion of your monthly Internet bill is also a work expense. Sure you're also using it to chat with your friends and faff about on Facebook, but if you need it for work then it's still a work expense.
New Stuff
I mentioned a cell phone upgrade a moment ago, but there are all kinds of things you can claim as a deduction when it comes time to pay the IRS enforcers off for the year. Did you buy a new laptop so you could work on the road? Did you buy the new edition of The Writer's Market so you can submit your novel using updated guidelines? Did you buy a microphone to record audio books, or a new camera so you can vlog? All of that qualifies as a work-related expense.
Not everything qualifies. |
If you're not sure whether one of your purchases counts as a tax write-off then it's best to chat with a tax expert. Still, if you bought a $750 laptop it's a good idea to hang onto the receipt and to let the tax man know you spent that on your career instead of on yourself.
Travel and Events
While you might write a novel at your desk in the basement, you have to leave your house if you're going to market it. You need to meet with reporters for interviews, show up at radio stations to be a guest speaker, get to the bookstore where your signing is going to be, and perhaps most importantly you must arrive on time to the convention in order to do readings, man the signing table, and make connections with your fellow authors.
There are literally two dozen readers you must reach here. |
What counts as a travel expense? Everything! Did you drive to an event specifically for your profession? Then you can claim the mileage as a cost. Did you have to buy a badge to the convention? A hotel room for your stay? A plane ticket? Congratulations, if that is an event you need to be at for professional reasons then you can claim all of those expenses on your taxes. It doesn't matter if you also got to have a fangasm moment at a panel, or that you're there to see friends and get hammered at after parties... the point is the event is important to your career, so you can write it off.
Miscellaneous Expenses
There are a lot of little things that authors don't even think about that can be written off come tax time. Sometimes it just doesn't seem worth it (it's just $3 for a signing pen, after all), but if you add up all of the costs you might find you spend a surprising amount of money throughout the year on your projects.
Do you go out to dinner with your publisher and pick up the tab to get on his good side? Do you have a membership to an industry magazine that helps you get the information you need? Do you pay a membership fee to a website like www.elance.com in order to be able to bid on projects? Did you go on a historic tour or buy reference books to research your plot or to ensure your blog was accurate? Lastly... did you buy a new signing pen?
Every one of these beauties is tax deductible. |
It's actually kind of amazing the sheer number of expenses you can claim, as long as you can A) show that the expenses are necessary for you to do your job, and B) that you have a receipt to back up how much you spent on a given purchase.
Does this make up for the fact that as a self-employed individual authors may lose as much as 30% of their income to taxes? No, of course not. But if you manage to pay a few hundred (or a few thousand) dollars less on your taxes then you have money leftover for things like food, rent, the cost of health insurance, and of course enough to buy just one more book.
Lastly, before you just send in a stack of forms telling the government you don't owe them anything, it's a good idea to consult with a tax professional. While dropping a C-note on something you can ostensibly do yourself might make you balk, a tax professional is easily worth their weight in the savings he or she will provide.
Trust me.
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