So I did my taxes last week, and uhhhhh it hurt.
But despite the fact that the government kept so much of my money, I was super happy this year because this was the first year that I really had a substantial amount of freelance/blogging income to report.
This past year, I made a little upwards of $11k+ blogging, so I definitely feel accomplished.
But given that it was my first year treating my blog as a business, there are a lot of things that I can improve upon moving forward.
There were a lot of things that I could have done differently to decrease my taxable income, so I’ll definitely be paying attention to that this coming year.
So based on the conversations I had with my tax guy recently, here a few tips for any of you out there making some monaaaay off of your blogs/side gigs! Taxes for bloggers 101.
1. Don’t spend all the money you make.
Throughout this past year, I spent a lot of time reading about blogging and taxes and one of the figures that I kept seeing over and over again was that you ought to be saving 20-30% of your income for taxes. To be safe, I did save 30% of everything I made, and thank God I did, because that’s exactly what I ended up owing. So yea, it sucks that for every $100 I make, I only really get to keep $70, but it is what it is, so you need to put some money away so that you’re not hit with a giant tax bill you can’t pay come April.
2. Save all your receipts.
I’m the worst when it comes to saving receipts. I get a receipt, crumple it up, and throw it in the “black hole” also know as my purse. Joe’s always bugging me about that because if I throw a piece of paper in my purse, I’ll likely never see it again, so that’s usually what ends up happening to my receipts. But when you own your own business, or you’re doing freelance work, you need to keep those, so you can claim some of your expenses and reduce your taxable income. And don’t just throw the physical receipt in a folder and call it a day. No. Don’t do that. Instead, make a photocopy of the receipt and THEN save it, because physical receipts tend to fade rather quickly, and the last thing you want is to open up your folder come tax season and not be able to make out what your receipts say.
3. Don’t wait until the last minute.
You don’t want to wait until the night before you’re gunna do your taxes to get all your paperwork together. I did that this year, and NEVER AGAIN. There’s just no reason for this. Every month, you should be keeping a detailed list of what you made and any expenses, so that way, when you’re ready to do your taxes, you’re not scrambling to find receipts. When you wait until the last minute, you’re obviously much likelier to forget things that could help you, so do your best to stay organized throughout the year, and it’ll make things a lot easier at the end. Totally worth it.
4. Know your possible deductions.
I spent most of this year without knowing that there are SO MANY tax deductions for bloggers. And that sucks, because that means I could have reduced my taxable income by a whole lot more had I been smarter about tracking my expenses. So take some time to educate yourself this new tax season, and have a better game plan for 2016 when it comes to your expenses. For example, I had no idea that you can claim your mileage if you’re driving around gathering items and doing work for your blog, so that’s one of the things I’ll be tracking this year. I mean, every bit adds up, so it’s worth a shot.
5. Talk to a pro.
I got my taxes done at H&R Block this year, but we made a point to make sure that the person doing our taxes really understood freelance work. This is your money you’re talking about here, so you shouldn’t take any of this lightly. You’ve worked hard throughout the year, so you want to make sure that the person doing your taxes and giving you advice really knows their stuff. It’s always a good idea to talk to your tax person a few weeks before you plan on filing them, so you can ask them any questions you have, and make sure you understand what necessary paperwork you should bring with you. Preparation pays off!
Best of luck to you guys!
Any other tax tips/suggestions? We could all use all the help we can get!
New to blogging? This might be a good place to start.
Oh, and I’m now offering 1-on-1 coaching sessions via phone to help answer any blogging questions you may have. $25 for a one hour session. Would love to share any advice I can give you, and make a new friend along the way! Contact me here for additional info 🙂
Books on blogging to help you take your blog to the next level:
- Building A Framework
- Blog, Inc.
- Creative, Inc.
- How To Blog For Profit Without Selling Your Soul
- 365 Blog Topic Ideas: For The Lifestyle Blogger Who Has Nothing To Write About
- Leave Your Mark: Land Your Dream Job, Kill It In Your Career, Rock Social Media
- Crush It
- Jab, Jab, Jab, Right Hook
Books to help you deal with your twenties:
- 101 Secrets For Your Twenties
- Life After College
- The Defining Decade: Why Your Twenties Matter & How To Make The Most of Them
- Adulting: How To Become A Grown Up in 468 Easy(ish) Steps
- All Groan Up: Searching For Self, Faith, and A Freaking Job!
Other stuff you might like:
- Generation Y Redefines Success
- How To Be Rich in Your Twenties
- The 5 Most Valuable Lessons Grad School Taught Me
- Pursue a Lifestyle, Not a Job
- Why It’s Okay to Be Excited About the Awesome Stuff You’re Doing
- Why We Need to Get Over Our Fear of Rejection
- Don’t Wait, Be Happy Now
- The 5 Best Investments You Can Make in College
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