Tackling Taxes if You Are a Self-Employed Writer, Poet and/or Artist - The Basic Organization

(I had this cartoon up last year around this time and well, I think it's funny enough to have it make a return showing...)

I am not an accountant and will not pretend to be one here.

In fact, I hate doing taxes so much, I have never done my own, but since college have paid someone to do them. Even when I was Top-Ramen-Eating broke, I went to Sears and had them done byH&R Block for $50. Taxes are an area where I believe people know more than me and I don't like to mess around with them, so I will pay them do to the chore I dislike the most...yes, even more than cleaning the bathroom.

But I'm writing this post is just to pass along some information I received last year from our tax accountant in the job of keeping track of things as a freelance writer or artist. It's a question I get a lot this time of year and thought maybe the info could help you out a bit.

If you haven't created files for your receipts & income this year or become organized with your self-employed/freelance part of your life, it's not too late, it's only March, you can start keeping track of your expenses and earnings right now. (And if you are making $$ off of your writing or art, I am pretty sure you need to let the IRS know each year...)

Here's how I organize my earnings and expenses for my writing life.

Note: I live in Washington State, so the rules, laws, etc. might be different than your state so make sure you look into it so you get it correct for yourself. I am not an expert, just someone who is trying to follow the rules and stay organized.

So here is my basic organization for my writing life and then I'll break it down a little more.


Since I am self-employed, the most important thing I can do is keep my receipts on expenses, keep track of my mileage, and keep track of how much income I made as a writer.

Here is my basic breakdown that I organize by--

EARNINGS
EXPENSES
MILEAGE

What I usually do is just have one big folder in my desk file drawer for all of these.

I organize it a couple days before our appointment with our tax accountant, as that way everything is in one place and I don't have to spend all year thinking about it.

My yearly process is like this--I get a receipt and put it in the folder. I win a poetry contest or am paid for a reading, I put the check stub in the folder. I drive some place to give a reading, I put the mileage in my folder. That's it, I just do that all year long. It's simple and doesn't take any time.

Another way you can do this is to have 3 folders near your desk or where you can put in all your receipts, check stubs, or notes (in the case of mileage) for these three items. This may help you at first remember what you need to keep for your taxes.

* * * *


Once you have this system down, you can break down these categories even more.

Expenses can be broken down into:
Meals
Lodging
Books
Printing/Other Expenses
Other Home Office Expenses (if you have a home office)


Since I have a home office, my tax guy needs these numbers for the year as well since a certain percent is deductible--

Electric:
Water:
Garbage:
Propane:
Phone/Internet:

****There are certain rules about what a home office consists of, so definitely look into that because I know not every home office counts. My home office is the writing studio I build (aka Shed of Kells) and it does count as a true home office.

For me, paying the extra fee to have an accountant take care of this for me and to have someone who will answer all my questions is completely worth the charge than for me to do my own taxes.

So that's about it. That's how I organize my taxes for my writing life.

Each year it gets a little easier because I know what I'm looking for and am supposed to keep. It's pretty much a habit for me to just toss all my receipts, payment info, and mileage into my folder. And 2010-Kelli is currently thanking 2009-Kelli for being so organized, it makes this time of year so much easier.

Happy Refund Check to you! (I hope!)

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