February 7, 2017

Can I Deduct That? Some Tips for Writers

My author table at a workshop
where I taught several classes

© Barbara V. Evers, All rights reserved.
After attending an out-of-town writing workshop last year, I reminded a friend that the cost of the workshop was tax deductible. Her response? I don't bother with that.

Why don't writers claim deductions?

I keep track of my writing expenses, and if you write for a living or to seek publication, you should, too. I've had this conversation with more than one writer, and the most common objections include:
  • I don't have time to track the information
  • I won't have many deductions
  • I'm not making money/profit from my writing right now

For some reason, writers believe they must show a profit in order to claim the expenses related to their work. Although you will eventually have to show income and profit, you can claim expenses. (For clarification of acceptable business loss time frames, ask your tax expert.)

What qualifies as writing income?

If you don't currently have any writing income, consider some of the potential income sources available to you:
  • Speaking to writing groups
  • Teaching a writing workshop
  • Writing technical documents for clients
  • Writing resumes or web content for a client
  • Winning contests with cash prizes
  • Selling your work on Amazon
  • Selling copies of literary journals you're published in
  • Editing/Proofreading

As a training consultant, I write a large percentage of the materials I use with my clients. I, also, write resumes and create slides, exercises, and outlines for online training. I have specific income related to writing. But...

Even if you haven't earned any writing income,
you should keep track of your expenses.

How else will you know what you've spent in pursuit of your writing dream if you don't?

 

What can you claim?

If it supports your writing, it may be a writing deduction. Some common deductions include:
  • Paper
  • Ink
  • Postage
  • Computer
  • Printer
  • Software
  • Office space (if the room you write in is used only for writing, you can claim it as a home office)
  • Internet access (research, online submissions, online workshops)
  • Workshop and conference fees (including hotel and meals if out of town)
  • Membership fees
  • Mileage to any writing-related event
  • Books related to your writing

A word about books

Do you write mysteries? You can write off the costs of buying mysteries.

Why? It's market research. Check the submission guidelines of any agency or publisher, and they will ask how your work fits into the current market. You must know something about the market, and the best way to learn and demonstrate your knowledge of the market is to read what's popular in your genre.

I realize not every writer has the business opportunities that I have, but if you're serious about writing, then you should be serious about the business side of writing, too. Most entrepreneurs get caught up in their creativity and fail to focus on the logistics of what they're doing. Don't fall into that trap.

NOTE:  I am not a tax expert. I rely on an accountant to help me determine what I can and can't deduct. It doesn't have to cost you a lot of money to work with one.

2 comments:

Phil Arnold said...

Hey Teacher: On the line about office expense, you wrote "if the room you write in is only used for writing.

Shouldn't that be "used only for writing?"

How about telling the readers what 1040 IRS form they use for reporting this stuff?

Phil

Barbara V. Evers said...

Phil, grammatically you are correct. I didn't catch that but will fix it. As for mentioning the form for reporting, I count on my accountant for that information. As I mentioned at the end of the post, I'm not a tax expert. Sorry.