The countdown to tax season has begun & the stress/fear/severe anxiety is beginning to sink in.

Who’s with me?!

I honestly think a day at the dentist would be more enjoyable that dealing with taxes for 5 seconds. Although, I may be biased cause I actually enjoy the dentist & getting to watch Dr.Phil uninterrupted on my own T.V. while getting giddy on laughing gas (don’t lie, you know it’s fun).

Really though, I think ANYTHING is better than having to sit & listen to some dude basically speak Chinese for two hours.

Since blogging is such a new career, tax time for us bloggers have been known to get a little sticky/unclear. Luckily, because the career is growing so rapidly, it seems that the tax peeps are finally starting to catch on. Even TurboTax has an article all about tax tips for bloggers!

That article is definitely helpful & I am thrilled about the recognition of our very serious profession, but it just doesn’t cover all the bases. Below I whipped up a little Q&A sesh to share some of the important things I’ve learned over the years in regard to blogging & taxes.

I’m definitely no expert (totally bombed accounting in college), but they do say experience is the best teacher & after a couple years of doing this tax dance, I feel pretty confident in my abilities to handle tax season like a BOSS… & hopefully after this post, you will too.

I hope this helps make taxes a bit less horrific for you & PLEASE share any other tax tips I am leaving out or feel free to correct me if I got ANYTHING wrong.

x, E

Q&A | TAX TIPS FOR BLOGGERS

Q: How do I know if I am blogging for business or hobby? If it’s a hobby, do I need to file taxes? 

A: The second you start getting money and/or receiving swag (we will get more into this in a sec), consider your blog a business w/ taxable income. Any money made, even if it’s $100, you will need to file. Once you start making more than $400 dollars, you will then have to deal with self employment taxes.

Q: HUH?! What’s self employment taxes? 

A: Well, you’re a blogger so the only person employing you is you (derr) & for that, you unfortunately have to answer to the tax man. There is an upside to this, being a blogger you have wayyyyy more deductions to include in your taxes (which majority of times covers that rude self employment).

Q: Okay, so what exactly CAN I deduct here? 

A: Anything that contributes to your business, yes business (get used to it), as a blogger. Some of these things include, but are not limited to:

» Blog design. So, if you want to get your blog designed through blog-doo, it’s totally deductible ;).

» Domain & hosting

» Work related events: conference fees, workshops, hotel stays, transportation, & gas.

» Blogger necessities: camera, business cards, computer, Photoshop,

» Hired photogs

» Advertising

» If you’re a DIY or food blogger, ingredients & supplies are also deductible!

» Oh, & you can also write off any tax fees! Score.

»  Office supplies, if used ONLY for blogging.

» If you work from home, talk to your accountant about writing off some rent (this can be tricky, but they’ll walk you through it!).

» Shipping fees

Q: What if I buy clothes/shoes/handbags for a post, can I write that off?

A: As lovely as that would be, you sadly can’t write off clothes you’re wearing in posts. The IRS is not going to let that one fly as it’s not a necessity to your biz (even if we all know it 100% is!!!).

Q: What about gifting & swag? Is that exempt?

A: This is where thinks often get a little “grey”. Typically, the IRS considers all swag a taxable income, but all situations are different and your CPA should be able to help you differentiate a gift from swag.

It’s super exciting to receive a pricey designer freebie, but just keep in mind that you will still need to pay taxes on it!

Q: How about trade? Does that need to be recorded too?

A: Sorry, to be such an epic buzzkill, but yes. If you post an Instagram in exchange for a free pair of shoes, you gotta write that shit down as well.

On the bright side, if there is no exchange of a trade agreement & the CPA considers those shoes 100% a gift (not swag), you’re in the clear & do not need to include them in your filing.

Q: That’s a WHOLE lot of info to keep track of. How do you reccomend staying organized all year long? 

A: Easy. Keep immaculate records. Quickbooks, although I’ve never grasped that program, is said to be great. For me, Google Docs works just fine. It may not be the most “profesh” way to go about it, but I’ve never had an issue & every CPA I’ve been to has been in awe of my organizational skills (little do they know it’s just my crazy ass OCD tendencies).

You can use my spreadsheet as a template if you please!

It’s also uber important to be sure to save all emails regarding any exchange of product and/or money. Hopefully you never get audited, but if for some reason you do, those records will be your saving grace. Also, find an accountant who takes complete responsibility for your filing, that way if you get audited it’s on their ass, not yours.

Lastly, make a habit of saving receipts. I recently got this one & have been loving it. Not only is it really cute, but it also has a “spending” note pad has been really helpful in keeping me organized!

Oh, and purchasing a receipt organizer is totally a write off, so record that too.

Q: What forms do bloggers need to worry about? 

A: If you go to CPA, they will handle all of this for you, but if you’re trying to DIY your taxes (which btw, I don’t reccomend!), here’s what you forms you’ll need to deal with:

» 1099-misc: If you’re earning over $600 in a year as an independant contractor, who ever is paying (such as affiliate networks) you will send you a 1099 from them.

» Schedule C: If you have filed as a sole proprietor (something to consider!), this form is mean to calculate profit and loss throughout the year. It is your income for the year minus your expenses for the year, giving you a net profit.

» Schedule SE: Meant solely for self-employment taxes, which you need to pay the second you make over $400.

» Paying others: If you hire anyone and pay them more than $600, you need to send them a 1099-MISC form.

Q: Word on the street is I need to pay estimated taxes, is this true?

A: Absolutely. If you are self employed, estimated taxes are required by the IRS. Basically this means you will pay your “estimated” taxes (just a guess) quarterly instead of at the end of the year. If they over estimate, you will get money back & if they underestimate, you will owe.

If you forget to pay your quarterly taxes, which is something I did the first year of blogging & is very common, you will be penalized.

The penalty is pretty low, so it’s not a huge deal but be sure to have your accountant set you up for the following year with all the necessary documents & mark the due dates in your iPhone calendar (or new receipt book!).

Q: Sadly I spent more than I made, what now? 

A: Okay so first of all, that is 100% normal when starting a business, so don’t beat yourself up. The good news is, because you are now treating your blog as a business (go you!), you can totally take losses on your return!