I spent almost every day last week gathering information for my accountant. I needed receipts and various other kinds of documentation for both our personal tax returns and those for my business.
I DO keep receipts in separate folders. However, according to my accountant, those of us in the business of writing, need to keep a monthly ledger of expenses (publishing costs, marketing, office supplies, and so on) and deposits (sales would make up the bulk of this income).
This habit makes tax time so much easier than tackling it all at once—as I did.
It’s also much easier if you have a credit and/or debit card for personal AND a completely different one for your business (which, thankfully, I did). We also need separate checking accounts.
Not only are these habits essential for taxes, they also are eye-opening when it comes to seeing in black and white—and maybe red—just how well our businesses performed over the past year.
Just as I claimed when I was a classroom teacher that “no one goes into the educational profession to make money,” I have realized the same holds true for writing.
Teachers teach largely because of their love for children and writers write out of a passion for communicating the written word.
I have learned to embrace this truth so that I am not so discouraged when I look at the bottom line, realizing the hourly rate for which I have been willing to work in order to achieve my dream.
After all, one cannot put a price on dreams…