FAQs About Taxes, Write-Offs, And Refunds For Self-Published Authors

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Self-published authors face daunting questions about what they can and can’t write off on their tax returns. We at Self-Publishing Relief are not accountants, so it’s important that you get the recommendations of a trained personal accountant for your unique tax situation. But we can offer you some generally accepted information to help you begin sorting out your self-publishing finances.

FAQs About Taxes And Self-Publishing

Q: As a self-published writer, what can I write off on my taxes?

A. Generally speaking, you can write off any expenses that go directly toward the advancement of your writing career: printer paper and other office supplies, plus books or other media purchased for research are some examples. Travel for work-related events is usually an acceptable write-off too—as long as your trip isn’t a vacation in disguise. Writers who have a home office space dedicated specifically to writing can also write off a percentage of their mortgage or rental payment based on square footage. Learn more about common write-offs for creative writers.

Self-published writers can also write off the cost of publishing, including costs related to editing, design, typesetting, printing, etc. If you pay an independent contractor (like a freelance editor or a personal assistant) over $600 a year (at the time of this writing), ask for a W-9 form so that you can write off that expense. Corporations do not need to send you a W-9.

 

Q: What shouldn’t I write off?

A. If something you’re hoping to write off is used for both personal and professional tasks, talk to an accountant about writing it off.

 

Q: What if I lose more money than I make?

A: As long as you have documentation that can prove you’re serious about making a business of your writing, it shouldn’t matter if you lose money on your efforts. To prove to the government that you’re a legitimate self-publishing enterprise, consider setting up separate business accounts with banks and credit card companies, applying for a Federal Employer Identification Number, getting a local business license, etc. Learn more about proving the legitimacy of your writing business.

 

Q: Do I need a specialized accountant?

A: We strongly recommend that you hire a personal accountant if you are going to write off business expenses for self-publishing. Tax software programs are not always adequately equipped to make judgment calls about your indie expenses and income. And a professional accountant can help advise you if you’re audited. If you find yourself making a lot of money, you may want to research accountants who specifically handle taxes for writers.

 

Q: How should I keep track of my expenses?

A: Writers can itemize their expenses into categories like:

  • Advertising
  • Web and online expenses
  • Supplies
  • Professional services
  • Travel
  • Meals

Ask your accountant for a full list.

 

Q: What should I do about my self-published royalties?

A: You have to report all income to the government, whether from e-book royalties or print sales. Keep careful documentation.

 

Write Off With Care

Demonstrating to the government that you are attempting to make a profit in spite of taking heavy losses might be fine for a while. But after a time, Uncle Sam may start asking questions. In a best-case scenario, you should be able to eventually show some profit for your self-publishing efforts—five straight years of losses might raise a red flag. If you are audited, be prepared with thorough documentation and accounting.

 

Question: Do you write off self-publishing expenses?

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