These notes about what we talked about in this episode of the podcast. They are not intended to replace listening to the podcast.
- Why should authors pay attention to the business side of writing?
- What are some common mistakes you see authors make?
- Do authors need a budget?
- Let’s talk about business entities. When should authors create an LLC?
- Let’s talk about estate planning. What happens to books when an author dies?
- Let’s talk about bookkeeping.
Benefits of an LLC
- Liability Protection
- Estate Management
Downsides of an LLC
- Depending on your state, additional taxes
- Cost money to setup.
- Some paperwork to maintain
- When is it a good time to create a separate bank account?
The IRS Business or Hobby Factors
- Whether you carry on the activity in a businesslike manner and maintain complete and accurate books and records.
- Whether the time and effort you put into the activity indicate you intend to make it profitable.
- Whether you depend on income from the activity for your livelihood.
- Whether your losses are due to circumstances beyond your control (or are normal in the startup phase of your type of business).
- Whether you change your methods of operation in an attempt to improve profitability.
- Whether you or your advisors have the knowledge needed to carry on the activity as a successful business.
- Whether you were successful in making a profit in similar activities in the past.
- Whether the activity makes a profit in some years and how much profit it makes.
- Whether you can expect to make a future profit from the appreciation of the assets used in the activity.
Sponsor: Christian Writers Institute
The Course of the Week: Tax & Business Guide for Authors
In the course you will:
- Learn whether or not you qualify for tax deductions for your writing-related expenses (not all writers qualify). You will also find out about the 9 factors the IRS uses to determine if someone is a professional author.
- Receive an indie business plan template. Learn how to easily create a business plan for your independent publishing business.
- Learn about a simple tool that will help you make more money as an author while helping make you become more audit-proof.
- Learn how to start making a writing income even before your first book comes out. Making extra money helps you qualify for tax deductions!
- Learn whether or not you need to form an LLC. We will also share a cheap and easy way to form an LLC when the time comes.
- Learn about 19 different tax deductions authors can take advantage of.
- Learn how to reduce your chances of being audited by the IRS.
- Learn how to avoid common mistakes that often get authors in trouble with the IRS.
- Tax court cases for your CPA.
Use coupon code “podcast” to save 10% or click the link in the show notes to activate the coupon code automatically.
This course is also part of the Tax & Legal Bundle which is on sale for the first two weeks of November 2019.