Lots of writers just write. The joy of creating a story, of dealing with those voices in your head, is amazing. And, if that’s all the farther it goes for a writer, there’s nothing wrong with that. But many writers take it to the next step and attempt to make a career of it.
And, that’s when everything changes.
A short caveat: I am NOT a tax professional or an expert on tax filing or law. I HIGHLY recommend that you find a good one who is willing to work with you as a writer.
Writing is a business and businesses need to follow rules, even before the writer becomes successful. I know, I know. Rules are scary things, like monsters in the closet. But, honestly, most of the requirements are not that difficult.
The “back sides” of businesses are very similar, whether they’re selling shoes, services, or books.
- A vision and understanding of exactly what that business is trying to accomplish. Use your writing skills to write a plan for what you’d like to accomplish this week, this month, this year. Break it down into realistic bites and set up a schedule. You’ll be amazed at how much you can do in a year!
- Organization. Figure out what you need to follow that schedule. Research? Put it on the calendar. Take a class? We never stop learning! Need to track something? Set up a spreadsheet. Carve out a space for your writing business, even if it’s just a box in a corner. But take your career — and you! — seriously.
- Accounting of money. The IRS already considers writing a hobby most of the time and, if you don’t keep good records they can and will disallow your deductions. Make sure you keep your receipts, (NOT in a shoebox!) and list them by month and type of expense. Keep track of your income – every dime is considered taxable by the IRS. You can use inexpensive accounting software or just a notebook and pen, but keeping records is how a good business runs.
- Separate your writing money from your home money. Keep track of it. Know how much you can spend on your writing business and stick to it.
- Accounting of marketing and return on investment (ROI). If I know how many books I sold because of a particular promotion, it’s a lot easier for me to determine whether it was worth the money, especially when I’m thinking of doing that promotion again. If I don’t make money, I may make a different choice. Of course, direct ROI (connecting a promotion to income) as opposed to indirect ROI (just putting things out there) can be difficult to figure out. But both are important things to track. One more thing: I’m absolutely against borrowing money to spend on a promotion. Yes, it’s easy to charge on that plastic card but, if you’re not making money on a book, it will have to be paid from somewhere else. Which leads to:
- Make a budget. Decide how much you can spend. Yes, sometimes businesses go into debt, but it’s never a good idea.
- Reward yourself when you reach a goal. Not every business does this, of course, but you can certainly pick a prize and use it as a carrot to get you where you want to be.
- Treat yourself as an employee. Take some time off. Don’t push too hard. Find some fun in what you do.
Are you running your business like a business? Why not!?!?!