Monday, January 11, 2010

Poets & Taxes


January asked about how writers/poets handle their taxes, here was my response to her--


: Writers, how do you handle your finances? I’m thinking about keeping my poetry-related expenses separate for tracking purposes, but I’m not sure what that will look like for me.

Do you have a separate account for your earnings and expenses? Do you use a tracking software or Excel spreadsheet? What do you consider a write-off? Any recommendations are helpful.


1) I keep my finances for poetry separate, but also do this very easily. Here are the key steps, all you need is 2 folders...

a) Keep a folder somewhere we you other documents (bills, poems, etc.) marked Writing Receipts 2010

b) Money Received 2010 - Writing Folder- This is where you put notes or receipts from all the money you have earned (in book sales, honorariums, etc.) over the year

c) Inside that folder have a piece of paper that says "Mileage" with dates/where/what etc. to keep track of all reading/writing events.

d) After 12/31, take both folders are add up your mileage, how much you made, how much you spent. That is what I use on my taxes.

One thing I've always paid for (even when I was at my poorest!) was an accountant to do my taxes.

I remember going to Sears and using H&R Block as they were really cheap there way way back. I swear, it's the best money spent this time of year. It's their job to know things and help you. I love that I get to ask questions each year about poetry and taxes. And I love not having to stress about doing my taxes. I just bring in all my receipts, sit down and eat the candy off his desk (note: He does not have a candy-topped desk like a magical fairy, but a great bowl of chocolates to share...)


Also, I keep a separate savings account for money I make through my poetry (i.e. grants, poetry contest winnings, book sales, etc.) This way if something comes up poetry-related and I want to go (Hedgebrook with Carolyn Forche, a writing conference or class, or I need to buy a new computer), the money is there without feeling as if I have to somehow find a way to take it out of the family budget and worry if we have it or not.

Since it's the start of the year, I recommend that right now, everyone gets two folders and put your receipts in there all year! If you haven't been declaring yourself as a writer each year, maybe you should be...

2 comments:

Lyle Daggett said...

Hmmm... since my lifetime income from writing is maybe around $200, I'm thinking that keeping track of all that paperwork would be a bit more effort than it's worth.

Years back I met, a couple of times, a poet in Pasco, WA, who worked for a living as a tax accountant. (On the back of one of his books, it said that a friend once introduced him at a reading as "a tax accountant who makes his living as a poet.")

Jessie Carty said...

i've never made more than about $500 before any applicable expenses but with a book coming out this year i am finally keeping a more accurate measure.

whenever i have received some contest awards i put them in my paypal account for buying books etc :)

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