Do you consider your blog a business? If you make a profit from running your blog, you can bet that the IRS sure does! I’m no accountant, but I do know that your income from blogging has to be reported when filing your taxes. All of it. Even items you receive for free. That counts as income, too. Today, I want to share some tips about how to file taxes as a blogger so that you can do it painlessly and reduce how much money you owe to the IRS. Let’s get started!
First of all, I filed and paid my taxes with Turbo Tax. Like, just now. I’ve been using Turbo Tax for years, but this is my first time using their paid “business” version. I love how comprehensive it is! I liked using Turbo Tax to document my first year of blogging, because it walked me through all of the deductions I was able to take, but if you have an accountant or can do it yourself (??!?!?) then by all means! 🙂
So, how do deductions work?
Basically, if you spend money on your business/blog throughout the year, you can deduct part of these expenses from the money you’d otherwise owe to the government. For example, if you owed $1,000 based on your yearly income, but purchased a bunch of things for your business or blog, you could cut that amount down to $100. I should note that your expenses should not outweigh your income. So if you made $1,000 from blogging last year, you shouldn’t be writing off $2,000 of computer equipment. The IRS allows you to do this for three years, but then decides that you have a hobby rather than a business.
I also highly recommend saving your receipts, just in case you get audited. If the IRS thinks you’re fibbing or finds errors in your return and you’re found without proof that you purchased those deductions, you’ll be faced with extra fees and penalties. No bueno. Moral of the story? Save your receipts! Lots of people have folders or boxes that they toss their receipts into, but don’t forget to print out receipts and invoices for purchases made online, too. You could even scan your paper receipts and keep them, along with your online invoices, in a folder on your computer for easy organization. I’ve also noticed that money received as a blogger does not come in one tidy paycheck each month. Each month, I have money coming from all different sources and if I didn’t keep track of it, it would be extremely easy to lose track (or give myself a huge headache come tax season!). Instead, I recommend keeping a spreadsheet on your computer where you can track all the money you’ve earned as a blogger.
What are popular blogger deductions?
- Your blog design/template
- Blog conferences and workshops (even our recent OC Blogger Brunch!)
- Hotel and transportation costs if you had to travel to a blogger event
- Mileage (for your 2013 taxes, you can deduct 56.5 cents for every mile you drove as part of your blogger gig…for example, driving to a nearby blogger event)
- Business cards
- Buying ads on other sites
- Blogging related e-courses (like this one)
- Supplies for DIY projects that you use in tutorials on your blog
- Your computer
- Your camera
- Web hosting fees (I use and recommend Bluehost and WP Engine)
- Domain name fees
- Software, such as Photoshop
- Skillshare and other educational platforms (if the courses you take relate to your growth as a blogger)
- Paypal fees (yes, all those fees they take from you can be deducted!)
- Stock photo fees
- Your blog framework, if you purchased it (such as Headway or Genesis)
- 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
- Postage fees
- Blog coaching/consulting
- 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
There are even more things, depending on you and your blog, but just remember that if you spend any necessary money to run your blog, you might be able to write it off. I was horrible about keeping my receipts when I lived in Japan, both because taxes weren’t on my mind when I started my blog and because I never assumed I’d make any money from this ol’ thang. Do a better job than I did and start now. You never know how much money you’ll make before 2015 and when taxes strike next year, you’ll be so glad you kept all those receipts for deductions. 🙂
Will you be filing taxes for your blog this year?
**I’m not an expert on this topic, so you should probably consult a tax professional or filing service instead of taking my word as the gospel, but I hope this was helpful. 🙂