Freelance Income Reporting Tax Tips for Writers

Tax time is never fun. Freelancers, such as writers, often are stumped on how to handle their income reporting for the year and worry about the amount owed to the government for unpaid personal income taxes. There are many things a writer can do to ensure they can avoid a potential audit from the IRS as well.

Writing as a Business

Treating writing like a business is the best way to ensure that a tax dilemma does not occur. This includes keeping accurate records on all income and recording it in a place that is easily accessible come tax time. Make sure to record earnings as well as expenses since many expenditures can be tax deductible if they are qualified. This includes writing supplies, equipment and other purchases necessary for the writing business. Subscriptions and even home office space may be tax deductible, so keep a file of every single expense.

For tracking income, make sure to at least include the source, a description of the service or piece, the form of payment issued as well as the amount. This form of payment can be a copy of the payment.

Staying organized as a writer and treating writing like a business will help make tax time much easier on you, lower the amount of taxes to pay as well as decrease the chance of an audit.

What Tax Forms to Fill Out as a Writer

Freelance writers who have made any income the previous year will need to fill out a long 1040 as well as a Schedule C and a Schedule SE (self-employment tax) to report profit and loss. Keep in mind that if planning to deduct a lot of expenses, additional forms will need to be filled out as well. You should consult a tax expert if you are unsure of how to prepare you tax forms.

As always if you have any questions or comments please email me at rondazaragoza@gmail.com. I will try and reply to your question within 24-48 hours of receipt.