Do you sometimes struggle to make the numbers rhyme when you're handling accounting and tax planning as a poet? Not everyone looks forward to handling the numbers behind making a career out of a creative passion. However, things like bookkeeping and tax planning for poets are just as important as they are for people in any industry. The largely "freelance" nature of working as a professional poet can make bookkeeping for poets an especially complicated undertaking. The good news is that you can make your financials flow as beautifully as any stanza if you have the right tools for accounting for poets. Let's talk about being number savvy, staying organized and getting taxes done as you manage the "business" side of your work.
How To Actually Enjoy Tax Planning For Poets
Revolving income streams and tax codes that are more nuanced than Shakespearean sonnets can make tax time a real struggle for professional poets. The big thing to know is that there's no waiting until the last minute to figure out your tax situation if you work as a freelance or self-employed poet. Obligations like quarterly tax payments and self-employment tax mean that you have to keep a tight glance on exactly how much you've earned during any given period of the year.
You may already know that you're on the hook for self-employment tax whenever you earn income from having your work published in magazines and anthologies. However, things may be different if you're working as an instructor or adjunct professor for a school or university. Most adjunct instructors are considered independent contractors. That means that you likely won't be on the hook for extra tax payments if you're teaching courses.
We did promise that you'd learn how to actually enjoy tax planning. Most professional poets don't realize that they are missing opportunities for deductions at tax time that could leave them with more income in their pockets. For instance, potential deductions are available for any special software or notebooks you might be using to get your work done. Many working poets don't realize that they can actually deduct expenses from attending writing conferences and spoken-word networking events. Yes, you can actually get a tax deduction for spending time with other poets in a really fun setting.
Are you getting royalties from any of the published works you have floating around out there? You may be wondering what you're supposed to be doing on the tax side every time a check shows up in your mailbox. The fact is that you're going to need to report both recurring and one-time royalties if you hit a certain earnings threshold. However, the way you declare income from royalties is actually going to determine which schedule to use when you file. The way a company or publisher pays out will also determined the way you need to file. Did you know that the number of times you update or revise a book of poetry could dictate whether or not the government considers your earnings to be one-time earnings or self-employed earnings? This is where impeccable bookkeeping for poets can help you to make sense of your tax obligations.
Why Having A System Is Important
Are you still keeping check stubs, receipts, and records filed in a drawer or saved on your laptop's desktop? The tragedy is that you're probably adding hours of unnecessary work and confusion to your life. There's no need to do tax work and accounting tasks using ink quills and parchment the way some of your favorite poets did. Automation is the way to go when you're a busy freelancer. Getting yourself set up with some planning software that integrates with a popular program like QuickBooks means you can scan, plug in numbers and let the technology do the work for you. It's suddenly going to be easier to track income streams, report accurately to the IRS and get those deductions on record.
It's pretty easy to forget about a deduction from a conference you attended in May when it's time to get your taxes rolling at the beginning of April of the following year. That's why having a system that lets you plug in information in real time is so important for making sure you don't overlook deductions or lose track of records and receipts. Do yourself the favor of just giving it all to a program to handle.
Making Accounting For Poets Easier
Give yourself permission to focus on your craft instead of getting bogged down by tax and accounting work. Many professional writers and poets handle the complicated nature of having an unconventional income stream by handing the books over to a CPA for poets. Is it time to bring in a financial adviser for poets to get you on the right footing? Fortunately, we, at Fusion CPA are here if you need a CFO advisory for your poetry profession. We offer services to poets at all stages of their careers. Our accountants can show you how smoothly things can go when you have a trained, experienced financial adviser for poets setting up your year-round plan for taxes and accounting. We never get writer's block when it comes to whipping up unique strategies.You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.