We know April 15th is only a few days away. Some of these ideas might be a bit late in your accounting process, but if you are anything like most of us, a few new ideas and routines to implement for 2016 are always welcome. Both Tom Sullivan and Janet Sunderland, current Whispering Prairie Press board members and long time self-employed writers, have a a few ideas for you to consider.
Seroquel buy Please make sure you consult a tax advisor for the best approach for you and your business. We are writers and artists, not accountants.
http://alandaluzza.com/contact-us/ Advice from Tom: Taxes made easy.
Here are a few things to consider if you derive most of your income from pursuing your craft independently.
- Decide how you want to organize your business. There are legal and tax-related benefits and drawbacks to organization as a sole proprietor, a qualified joint venture (instituted in 2007 for married couples who work together), or a corporation. There are several classifications. The best choice will depend upon the specifics of your business and local laws. Consulting a lawyer and/or accountant would be prudent.
- If you’re earning enough to live on, you’re probably going to be paying taxes in April rather than collecting a refund check. Start saving money specifically for your taxes. Put it in a separate account and consider it already spent.
- Reduce the pain of writing big checks to Uncle Sam by filing quarterly taxes. The amount you pay is based on your estimate of how much you’ll make during the year (use Form 1040ES). Generally, if you plan on paying in more than $1,000 of income tax for the year, you should pay taxes quarterly. Note that quarterly taxes are due in April, June, September, and January, so be prepared for the two-month turnaround in the spring.
- Any small business should consider hiring a tax accountant. You’ll likely be less stressed and more productive with the peace of mind that professional advice can bring. You could be earning money rather than trying to decipher the tax code.
Quetiapine side effects Advice from Janet: Records and Filing
As an individual artist, you are your own company and can file a Schedule C once you earn money as an artist. Here are some tips for keeping records and filing.
- If you aren’t familiar with Schedule C, go here and find a copy of both the form and the instructions.
- Start an Excel spread sheet. It’s easier to record receipts as they come in rather than stuffing them in a basket and sorting later. For example, categories may include, Office Supplies, Publications, Travel (including mileage to meetings), and Entertainment.
- After recording a receipt in Excel, put it in an envelope marked with a category; for example Writer/Actor, Medical, Donations, House, etc. Basically that’s all there is to it until tax time when Excel makes it easy to add up costs. Don’t forget the box for business use of your home at the bottom of the Schedule C. Enter the costs/income on the Schedule C and enter totals on your 1040.
- Most importantly, create a routine. All receipts stay on the desk until recorded in Excel. When W2s or 1099s come in, they go in the big envelope. After taxes are done, close up the big envelope, mark the year on it and store it.
Please always consult your tax advisor for details and to understand your particular situation.
Freelancers Union: It’s free to sign up and includes a link to download a free tax guide.
Schedule C form from IRS for profit or loss from business:
– Janet Sunderland and Tom Sullivan