Well, it’s a new year and the media is full of making resolutions and how to keep them. Of course most of those resolutions revolve around weight loss and exercise but for writers one resolution I’d like to highly recommend is how to keep your books – not the books your write but rather the books you would have to show the IRS (Internal Revenue Service) in a tax audit.
As I’ve mentioned before, the IRS web site is actually quite good and is an extremely useful reference for all writers whether published or not. I’ve also highly recommended that everyone visit the IRS site at least annually for updated information. Not all publications are updated annually but many of the forms, schedules and related instructions are and if you don’t visit the IRS site often enough you might overlook some important updates.
So, back to record keeping – there are actually several IRS publications I recommend to reference for record keeping and they include:
Publication 583 – Starting a Business and Keeping Records
Publication 334 – Tax Guide for Small Businesses
Publication 463 – Travel, Entertainment, Gift, and Car Expenses
Publication 535 – Business Expenses
Publication 538 – Accounting Periods and Methods
Publication 587 – Business Use of Your Home
Publication 1635 – Understanding your EIN
I also recommend revisiting the following Forms, Schedules and Instructions:
Schedule C (Form 1040) – Profit or Loss from Business (Sole Proprietorship)
Schedule C (Form 1040) Instructions
Schedule SE (Form 1040) – Self-Employment Tax
Schedule SE Instructions
Form 8829 – Expenses for Business Use of Your Home
Form 8829 Form Instructions
All of the forms, schedules, publications and related instructions can be found at the IRS website – www.irs.gov – and now is a good time to set one very important resolution as a writer and that is to keep good tax records throughout the year so that when 2016 comes around you’re ready to not only prepare your federal (and state where applicable) tax return but you’re also ready to defend it should a federal or state audit be in our future.