Answers to Tax Deductions for Writers

February 3rd, 2017 → 8:48 pm @ // 3 Comments

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Here are some great questions on tax deductions for writers that I’ve been asked:

 

What are some obvious, over-the-top tax deductions?

Excessive losses year after year, especially if the losses exceed your full time wages from employment. Excessive travel and entertainment expenses, especially if it appears you took a nice vacation and tried to call it a research expense.

I read a lot. Some of the books are to study other writers or my genre. Are the books I read tax deductions?

Keep your business deduction for books reasonable and small and they would probably be justified as business deductions.

I like to be around people when writing and usually write at my local coffee shop. Is the mileage to the coffee shop a business deduction?

Your location to write is a personal preference and not a necessary business expense, but rather a personal expense. The mileage is not deductible.

I hired a transcriptionist. Is it a tax deduction?

Yes;  put the expenses under Contract Labor  on the Form 1040 Schedule C tax form.

What’s a tax deduction that most writers don’t know about?

Gifts given to business clients or your agent, editor, or publicist are deductible. The IRS imposes a limit of $25 per person per year.

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3 Comments → “Answers to Tax Deductions for Writers”

  1. […] deductible and how to claim your deductions. As an encore, I also recommend that you read “5 Secrets to Tax Deductions,” “More Tax Deductions for Authors” and “Even more tax deductions for […]

    Reply

  2. Anthony

    3 months ago

    Carol,
    I recently listened to a webinar on Writer’s Digest where you provided some very interesting information.
    One question I would appreciate your help with is, “How do I submit taxes if I decide to use a pseudonym instead of my real name as ‘author’ when I write and or publish a book?
    Thank you for your time.
    r/
    Anthony

    Reply

    • Carol

      3 months ago

      Anthony,
      You must use your legal name when submitting taxes since your pseudonym is not a legal person.
      Your readers will never know that you have a different, legal name. And the tax authority doesn’t care that you use a pseudonym on your books. You could sell books by other authors as well. All they want is their tax.
      You could think of your pseudonym as a business name or “Doing Business As” (DBA) designation, although its not quite the same thing.

      BTW, all contracts are signed with your legal name as well.
      Carol Topp, CPA

      Reply

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