Can an Unpublished Writer Claim Tax Deductions for Writing Expenses?
Whether you're trying to start a new career as a technical writer or you're working on the next great thriller or romance novel, writing is a business and is treated as such when it comes time to pay your taxes. Just as a start-up business may not see any profit in the first few months, an unpublished writer may also claim tax deductions for writing expenses. The key is to stay organized and keep receipts and documentation of those expenses.
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Forms
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Most writers, published or unpublished, use the same Schedule C form for tax deductions used by small business owners. Claims on this form include advertising and promotional costs and home office expenses. For unpublished writers, the cost of a professional website or blog would be counted as advertisement and promotional work, while everything from paper to a laptop is a home office expense.
Documentation
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Particularly if you are unpublished and have never received payment for your writing, it is important that you keep all receipts for anything you choose to count as a tax deduction for writing expenses. Keep this information together in one file for easy access during tax season.
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Necessary Expenses
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If an item or activity was used in your writing activities in any way, those expenses are tax deductible. This includes books for research, fees for writers conferences and workshops, membership dues for a writers group and mailing expenses when querying agents and editors.
Personal vs. Business
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According to the U.S. Small Business Administration, "if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal portions." The business portion is then tax deductible. For example, if you purchase a picture book for your toddler, but also use that book for research on your own children's book, you could potentially claim that purchase as partly tax deductible.
Proof
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While your receipts will serve as proof that you purchased items for writing, because you are unpublished you will also want to have proof that you are pursuing a career as a writer. Keep responses from agents and editors, conference badges and copies of your queries as proof in case you are audited.
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References
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