I am not a tax expert. I dreaded my 2016 taxes for months because I knew it would be tricky, and I didn’t know the first thing about business deductions. Honestly, math and econ (really anything with numbers) is so not my thing. Every time I told a friend about doing my own taxes, they all said it was a bad idea and that I had to hire someone to help me or I would end up owing way more than necessary. So, this was the first year I hired a “tax guy” to help me.
All of the photos in this post were free stock photos from Pic Jumbo.
My tax situation is a little tricky because I have a corporate job, student loans and my blogging business. I don’t own a house or any land (haha reminds me of Dwight in The Office when they all roast Michael and Dwight tells Michael he’s got no friends and no land.) Anywayy, because 2016 was the first year I made money from blogging, I was quite surprised with how much money I owed after my accountant dove into everything.
My accountant shared Melyssa Griffin’s post which lists popular blogging deductions. I went through this entire list to ensure I did not forget anything I could possibly write off as a business expense.
Your blog design/template
Blog conferences and workshops
Hotel and transportation costs if you had to travel to a blogger event
Buying ads on other sites
Blogging related e-courses
Supplies for DIY projects that you use in tutorials on your blog
Web hosting fees
Domain name fees
Software, such as Photoshop
Paypal fees (yes, all those fees they take from you can be deducted!)
Stock photo fees
Your blog framework, if you purchased it
Fees to prepare your taxes (such as hiring an accountant or using Turbo Tax)
Photography, such as head-shots or paid photos taken for your blog
P.O. Box fees
A giveaway prize that you paid out-of-pocket for
Office furniture, if it’s used exclusively for blogging
Your home office, if it’s used exclusively for blogging
I did ask the question about beauty and fashion bits I purchased for review. Unfortunately, unless the product was purchased FOR a campaign and I was not reimbursed by the brand, beauty and fashion goodies cannot be written off due to the fact that you can use them in other instances that are not specific to the campaign itself.
Going through the potential list of deductions helped me bring down the cost of my taxes which were painfully high. Essentially every dollar in expenses I could find would help bring down my tax balance approximately $0.30. This will vary based on how much income you’ve acquired over the year, but this was the amount of expense dollar to tax deduction dollar I was able to muster.
After getting through everything this year, my accountant and I decided I will with-hold more on both federal and state fronts (from my corporate job) so I owe less overall and don’t get penalized for owning so much. I didn’t know that was a thing. If you owe the IRS too much at tax season, you get a fee based on the percentage of how much you owe. The IRS is not in the business of us owing them money (but it’s okay if it’s the other way around evidently.) They prefer you pay regularly so they get their money in steady increments rather than all at once. The best way to avoid this fee is to make quarterly payments to the IRS which is what I plan to do this year.
Because I love you guys and I want to help make this tax season (and the next!) easier for you, I am sharing my Excel doc with you. You can view my spreadsheet, and adjust it how you see fit (it’s not super fancy) but I think it’s a great start for you if you’re a new blogger or don’t have a tax sheet of any kind to track your payments and expenses.
Like I said, I’m not a math person. I hate numbers, unless it’s a number going into my bank account (LOL!) Hiring someone is honestly the best thing I could’ve ever done for myself because the headache of having to deal with this on my own would have been awful. It reduced my stress, and now I have a tax guy.
How did filing taxes go for you?