DIY Business Taxes Part 4a: Author Media Webinar

I submitted my taxes via e-file on Turbo Tax this morning, after which I found an email inviting me to join a webinar hosted by Author Media called: 7 Tax Saving Tips the IRS Doesn’t Want Authors to Know About. I paid $15 to join the webinar to increase my tax saving knowledge in preparation for next year’s taxes. Now is a great time to start implementing money saving tips and keeping my records for 2014 in order.

I’ll be attending the webinar on Monday, February 19 and will blog about it later. Check back for Part 4b of my DIY Business Taxes blog series.

Education is essential to success, and with the world at our fingertips there is no excuse for lacking knowledge of best business practices. I encourage you to join webinars, read blogs and dig deep to find the right questions to ask the experts.

DIY Business Taxes blog series 
Part 1 TurboTax
Part 2 MISC 1099 & W-2s
Part 3 Organizing Financial Information
Part 4a Author Media Webinar (you’re here!)
Part 4b Author Media Webinar (still to come)

Rachael HartmanRachael Hartman is an experienced writer and author. She has worked as a full-time newspaper reporter, and as a freelance contributor to magazines. She writes high school Sunday school material for Word Aflame Press as well as lessons for Project 7 (P7) student-led Bible Clubs, and blogs for Lady by Design. She enjoys health and exercise, reading, art, and playing with her two dogs Darla and Danny. She owns Our Written Lives of Hope, an online bookstore and publishing house in which she helps others share the message of the hope of Jesus Christ and promotes holistic health. Check out her web site at www.owlofhope.com and link to her on Facebook.

DIY Business Taxes Part 3: Organizing Financial Information

Once my sister and I started going through the TurboTax process again (to make sure that I, in my frustration, had correctly entered all the information thus far), I realized I wasn’t quite as organized as I thought I was. I had my total “incoming” and “outgoing” numbers, but I didn’t have a break down of everything. I did do a few things right which helped me in the end, and I had to take some organization a few steps further.

Here are some helpful tips for preparing for business taxes. I hope I can save you (and myself) some grief next year by outlining simple steps to organizing business financial information.

  • I always used my business credit card to make business purchases, and I paid it off every month. I stayed within my budget and I didn’t spend more than I had to. I used checks to pay royalties and to pay for my business license (only because they don’t accept credit cards).  Using my credit card did two things to help my business: it raised my credit score and it documented every purchase.
  • At the end of the year, I went to my bank website and downloaded a .csv file of my credit card use, with a limitation of January 1, 2013 through December 31, 2013. Once the information was in Excel, I organized it into categories: purchases, returns/refunds/adjustments, and payments. Note: I made one purchase which I returned last year. I put the sale purchase line for that item into returns/refunds/adjustments category.
  • Using various colors and row spaces, I broke down the “purchases” section into the following categories: production costs (including shipping), supplies, communications (including cell phone and internet), marketing (including website, business cards, flyers, etc.), travel (including gas and hotel expenses), and fees (including late fees from my bank).
  • I also downloaded a .csv file on my business debit card for the entire 2013 year. I organized the information into automatic deposits I received from various business partners, deposits I made at the bank, and online transfer-deposits I made from my personal account. Note: I used personal savings to start my business instead of taking out a loan, so I wanted to calculate how much I still “owe” myself and to distinguish that the money I invested was not taxable income.

For 2014, I’m taking the organization of my financial information to a new level. My accountant-sister and I will be creating an easy-to-use Excel document in which I will categorize all purchases, deposits, etc. each month. The added monthly overview will help me to create a targeted budget and see where my money goes to and comes from each month. I plan to share the shell of the Excel we create with you, so keep an eye out!

DIY Business Taxes blog series 
Part 1 TurboTax
Part 2 MISC 1099 & W-2s
Part 3 Organizing Financial Information (you’re here!)
Part 4a Author Media Webinar
Part 4b Author Media Webinar (still to come!)


Rachael Hartman
Rachael Hartman is an experienced writer and author. She has worked as a full-time newspaper reporter, and as a freelance contributor to magazines. She writes high school Sunday school material for Word Aflame Press as well as lessons for Project 7 (P7) student-led Bible Clubs, and blogs for Lady by Design. She enjoys health and exercise, reading, art, and playing with her two dogs Darla and Danny. She owns Our Written Lives of Hope, an online bookstore and publishing house in which she helps others share the message of the hope of Jesus Christ and promotes holistic health. Check out her web site at www.owlofhope.com and link to her on Facebook.

DIY Business Taxes Part 2: MISC 1099s (and W-2s)

I paid royalties to two people in 2013. The IRS requires a federal MISC 1099 report for any royalties paid which amount to over $10. The initial reports are due at the end of January.

I used www.speedEfiler.com to submit my MISC 1099s. It was a decent price at $5 per file, which included an electronic copy and a mailed copy to my people. However, I’ve since learned TurboTax will allow me to report the 1099s directly through their site.

There are 40 states that require state reporting when it comes to MISC 1099s and W-2s. You can look up each state’s requirements for reporting MISC 1099 and W-2s HERE.

If you pay someone else money, file the correct form for them to report that money on their taxes,  and be respectful enough to turn it in on time! You don’t want to mess up your own taxes, or your client’s taxes.

When you file a MISC 1099 or a W-2, you are no longer responsible for paying taxes on that money. The person you paid is responsible for paying the taxes on the income they received.

So as you’re planning for next year’s taxes, be sure to collect a W-9 form on each person you plan to pay royalties to (or if you are paying them as an independent contractor). You don’t have to worry about holding out taxes for them. You just have to have their information and know exactly how much you paid them throughout the year.

DIY Business Taxes blog series 
Part 1 TurboTax
Part 2 MISC 1099 & W-2s (you’re here!)
Part 3 Organizing Financial Information
Part 4a Author Media Webinar
Part 4b Author Media Webinar (still to come!)

Rachael HartmanRachael Hartman is an experienced writer and author. She has worked as a full-time newspaper reporter, and as a freelance contributor to magazines. She writes high school Sunday school material for Word Aflame Press as well as lessons for Project 7 (P7) student-led Bible Clubs, and blogs for Lady by Design. She enjoys health and exercise, reading, art, and playing with her two dogs Darla and Danny. She owns Our Written Lives of Hope, an online bookstore and publishing house in which she helps others share the message of the hope of Jesus Christ and promotes holistic health. Check out her web site at www.owlofhope.com and link to her on Facebook.

DIY Business Taxes Part 1: TurboTax

I’ve always done my own taxes. It’s never been too complicated. I started using Turbo Tax a few years ago, and I’ve been happy with their user-friendly step-by-step process. As a small business owner, I decided to try filing my first year’s business taxes on Turbo Tax as well.

Turbo Tax offers a Home and Business option for just over $70 (more than I wanted to pay), but it was cheaper than going to an accountant any possibly paying $200. P.S. My business is an LLC, which means I file my business taxes along with my personal taxes; I didn’t have to set up a separate TurboTax account for my business.

My first time through the business tax filing process was a fail. My outdated computer was part of the problem. The flash web page kept reloading and wouldn’t move forward. I ended up buying a $20 upgrade for my MAC, which still featured the 2007 software I bought it with. I’m still two upgrades behind the latest available software, but taking this one simple step brought my computer into functionality with flash sites, allowed me to download Google Chrome, and helped take care of a couple of other bugs.

Now that my computer was capable of performing the task, the next step was helping myself upgrade from totally frustrated about taxes to peaceful and taking it one step at a time. For me, that meant enlisting the help of my sister, who has worked in banking for years and is now taking steps towards her CPA license.

Note: if you are frustrated, get help! You don’t have to have a sister who is an accountant, but you do need someone who knows how to follow directions, who has common sense, and who is far enough outside of your situation to not be frustrated.

As with all things, the first step in properly filing taxes yourself is emotional regulation. If you are frustrated, stop! Don’t waste your time and energy running on frustration. Find someone to assist you and you’ll find the process is much less daunting!

DIY Business Taxes blog series 
Part 1 TurboTax (you’re here!)
Part 2 MISC 1099 & W-2s
Part 3 Organizing Financial Information
Part 4a Author Media Webinar
Part 4b Author Media Webinar (still to come!)

Rachael HartmanRachael Hartman is an experienced writer and author. She has worked as a full-time newspaper reporter, and as a freelance contributor to magazines. She writes high school Sunday school material for Word Aflame Press as well as lessons for Project 7 (P7) student-led Bible Clubs, and blogs for Lady by Design. She enjoys health and exercise, reading, art, and playing with her two dogs Darla and Danny. She owns Our Written Lives of Hope, an online bookstore and publishing house in which she helps others share the message of the hope of Jesus Christ and promotes holistic health. Check out her web site at www.owlofhope.com and link to her on Facebook.