Tuesday, March 5, 2013

THOSE PESKY TAX ISSUES - with Gae-Lynn Woods

Gae-Lynn Woods

I don't know a single person who enjoys Tax time. I would rather write a synopsis than think about taxes as a self-employed filer. Okay, so that's not the best example since I don't mind writing the synopsis, but you get my drift. Last year I came across a blog by someone 'in the know' when it comes to taxes. Gae-Lynn Woods is a talented author and a CPA so she understands how this all works from both points of view. If you have any questions, please leave them in the comment section. Also, feel free to share a link to this and any of my posts.

Thanks so much to Angela for letting me stop by The Writers Studio to chat! Getting ready for tax season is a chore most of us dread. But as an author, you’re running a small business with all the privileges and responsibilities thereof. I know, I know! You’re an artist, not a grubby businessperson. But once you put your work out into the world for sale, you need to know how much income (or loss) you’re generating. It’s not as hard as it sounds. Really. All you need is a little discipline. And anyone who can produce a book can master the fine art of tracking income and expenses.
The tips I’m sharing apply to all sorts of businesses. We run four: my husband is a musician; we raise beef cattle; and I have an accounting business and a writing business. Regardless of your professional focus, there are two important reasons to track income and expenses during the year: the first is to provide you with a means to monitor your business performance. The second and most practical is to make tax time easier. If you’ve ever shoved your paperwork into a drawer only to cry when you dig it out during tax season, you’ll dance with glee when you pull your organized paperwork out!

There are oodles of ways to achieve these goals – this is my process, but use that creative brain of yours to massage it into something that works for you. Because we run four businesses, I try to update our records at least twice each month to keep the paperwork from getting out of control. You may find that monthly or even quarterly updates are frequent enough for you.
Confession time: this isn’t the most enjoyable part of my life. In fact, I whine a bit before getting started. But once I’m into the process – well, once I’m done – I feel great. I hope you will, too. So, grab a coffee (or something stronger), let loose with a few groans, and let’s get started!
I use a few simple tools to track our expenses:
1) We keep a small notebook in each vehicle. If we’re driving somewhere for business purposes, we note the date, purpose of the trip, and starting and ending mileage.
2) I transfer the details from each of our business related trips to a desk calendar and follow the same form in the notebooks: trip purpose, starting and ending miles, and total miles travelled during that trip. I also note any important work related events in our calendar (cow sales or purchases, hay cutting, gig income, etc.).

3) On each work related receipt, we note which business it’s for and then toss the receipt in a basket on my desk. When it’s time to update our records, I dump the basket and start sorting.
4) I enter all information into a spreadsheet to capture expenses by category. Each business has its own spreadsheet, but they all follow the same general format, explained below. This is the place where we keep an eye on how each business is doing, and come tax time, it’s a matter of ensuring each column adds correctly and then clicking the print button. Yes, it really is that easy!
5) I separate the receipts by business, clip one month’s worth of receipts together, and stick them in a legal sized envelope. This clears my desk and helps me keep track of what I’ve completed. It also keeps the receipts in the same order that I’ve used to enter them onto the spreadsheet, in case I have questions later.
The Spreadsheet
 One of the most challenging aspects of filling in tax forms is figuring out which number goes where. To ease the process, I follow the categories the IRS has set out on Schedule C, the form you’ll file at tax time (see it here: http://www.irs.gov/pub/irs-pdf/f1040sc.pdf). I only include the categories I use, and each has its own column. Each row represents a separate transaction (income, expense, and / or mileage with no related expense).
Some of your receipts won’t fit into the existing Schedule C categories. For example, if you subscribe to a writing magazine, you might need another column called “Publications”. Add it to your spreadsheet include these items on page two of your Schedule C.
Your spreadsheet will look like this:

NOTE From Angela: I was unable to actually put the picture in this post. But if you email me: AngelaDrake (at) webname (dot) com I'll email the attachment to you immediately. I am in the office all day (Tuesday)

I hope this has been helpful, and that the paperwork aspect of your writing business feels a little less daunting. Questions are certainly welcome!

Avengers of Blood (A Cass Elliot Crime Novel) – Blurb
A deadly game of cat and mouse is playing out in Forney County…

Detective Cass Elliot is still on suspension after killing a fellow officer and Sheriff Hoffner refuses to sign her release papers. But when four people are murdered in one night, one with the exceptional brutality of a lynching, the Medical Examiner side-steps Hoffner to hire Cass and loan her to Forney County’s overstretched police department.

As Cass and her partner investigate, they realize that three of the murders were committed by the same person but find no connection between the victims. Their frustration intensifies when another victim survives and disappears instead of coming to the police.

Sheriff Hoffner is frantic about anonymous letters claiming one of his star officers is dirty, and Cass suspects a link to the current crimes. The pieces fall together when she uncovers the true identity of the man who was lynched, revealing connections between the victims, the killer, and an unpunished crime committed nearly fifty years ago.

Author Bio:
Gae-Lynn Woods is a Texan who has traveled the world, lived overseas, and come back home. She and her husband, British jazz guitarist Martyn Popey, share a ranch in East Texas with a herd of Black Angus cattle and one very cranky donkey.

THE DEVILOF LIGHT and AVENGERS OF BLOOD are the first two books in the Cass Elliot crime series. When she's not playing the roadie, tending to cows, fixing fence, or digging post holes, Gae-Lynn is working on the third Cass Elliot novel.

You can learn more about Gae-Lynn at her WEBSITE and her BLOG

Thanks for stopping by The Writers Studio!


  1. I actually have more questions now! OOPS. I had a business last year, so I know somewhat of keeping mileage and receipts, but now I'm wondering if I'm allowed to count all miles traveled. We were told only miles after the first stop and the stop before the last could be counted. Can we count novels bought for research purposes? (EX: Harlequin Intrigue novels to get the feel of that line if it's what I'm targeting) Where does the line stop on what can and can't be counted?

    1. Great questions, Amber. I'll let Gae-Lynn pop in and answer those. Thanks for stopping in! Remember to email me AngelaDrake (at) webname (dot) com for a copy of the spreadsheet. It's really a great visual!