Interview with Brigitte Thompson, Author of "Bookkeeping Basics for Freelance Writers"

Today I have the pleasure of interviewing Brigitte A. Thompson about her wonderful guide Bookkeeping Basics for Freelance Writers. Brigitte is the founder and President of Datamaster Accounting Services, LLC. She has been active in the field of accounting since 1986 and is a member of the American Institute of Professional Bookkeepers and the Vermont Tax Practitioners Association.

A prolific writer, Brigitte is the author of several business books, contributing author and freelance writer specializing in accounting topics. Her business has been featured in a best-selling book by Paul & Sarah Edwards, The Entrepreneurial Parent, and in Mompreneurs Online by Patricia Cobe & Ellen Parlapiano.

Brigitte lives in the Green Mountains of Vermont with her husband and three children.

Tell us about Bookkeeping Basics for Freelance Writers.

Writers have many important questions to ask about income and expenses, but no single source for answers. I created this book to be that source. It is an easy-to-understand guide to organizing a writer’s financial life.

This book addresses issues writers face daily such as how to deduct travel expenses, determine taxable writing income, and claim home office deductions. Navigating through the record keeping required for a small business owner can be difficult. This book is written exclusively for those of us who earn money by writing.

Readers will also find that each part of this book works together to assist in forming an overall business plan. The chapters take the writer through a comprehensive process that works as a building block towards a successful writing business.


Have you found that freelance writers require a different set of bookkeeping rules?

Many bookkeeping rules are universal such as the requirement to record income, but there are some areas of the tax law that are of more interest to freelance writers. This includes dealing with royalty payments, bartering, personal property and agent fees. My book addresses the universal tax rules as well as the infrequently discussed rules that apply specifically to freelance writers.

Learning how to document expenses and how to track income will give writers the best chance at overall business success.


What are some tax deductions that freelance writers might not be aware of?

There are many tax deductions available to writers. Some expenses are common, such as the cost of purchasing a case of paper or paying for a computer software upgrade. Other costs incurred in the operation of your writing business may not jump out at you as expenses when they could be. For example, consider the following accounts.

Mileage: Trips made in your vehicle to pick up office supplies can be counted as a business deduction if you record the proper information to support it.

Meals: Treating your agent to a restaurant meal with the discussion focusing on your next book can also generate a tax deduction when properly documented.

Shipping: UPS charges and postage used to mail a query or review copy of your book can be a small expense, but it should still be tracked. Those small deductions add up and every penny spent as a qualified business expense will reduce the amount of income tax you owe. 

Bookkeeping Basics for Freelance Writers devotes an entire chapter to expenses, including a comprehensive listing of expenses and detailed information regarding what documentation is required to support each one.


I'm sure you've observed other freelance writers making accounting missteps that cost them time and money. What are some of the most common issues and how can we avoid them?

The most common misstep I’ve seen with writers is not taking themselves seriously as business owners. This can lead to financial pitfalls. Many writers have been honing their craft for years so it’s hard to identify an official starting date for their self-employment. Without this point to mark the beginning, it is easy to put off tracking income and expenses. This can be an unfortunate mistake.

The IRS will consider you to be in business when you are actively pursuing projects intended to generate income and expenses. This means they will expect you to file a tax return to report those transactions. Keeping track of your income and expenses from day one will enable you to pay the least amount of income taxes on the money you earn.


Many people find numbers, especially when related to bookkeeping and taxes, intimidating. Will this book make these things easier to understand?

Yes, my book breaks down complicated number crunching into easy to follow steps. By reading the book, readers will understand why it's important to keep certain receipts and how those pieces of paper factor into the overall success of their writing business. Sometimes knowing the reasoning behind a task makes it easier to complete.

Writers can take advantage of some wonderful tax deductions, but only when they are aware of the possibility and know how to accurately document the expenses. My book explains it all in a reader friendly format.


Why is it important for writers to understand bookkeeping?

Writers are earning money and this money needs to be reported as income on their income tax return. If writers do not have any expenses to claim, their taxable income will be higher and they will owe more income tax.

Understanding what can be claimed as business expenses when you are a writer and how to properly document these expenses will help ensure the success of your business.

The most important thing you can do as a writer is to become organized. There are many books available on how to organize your writing, but this is the best book available about how to organize the financial side of your writing business.


Obviously, your book is a great place for writers to get information on bookkeeping. Are there are any other resources you recommend?

Yes, I recommend writers visit the IRS web site (www.irs.gov) to research specific tax issues and the Small Business Administration (www.sbaonline.sba.gov) for general business information.

I also recommend joining professional associations for writers such as American Society of Journalists and Authors (www.asja.org), The Authors Guild (www.authorsguild.org) and National Writers Union (www.nwu.org). There are many groups to choose from so consider the benefits of membership before joining.

I was interviewed recently by Freelance Success (http://www.FreelanceSuccess.com) which offers an insightful newsletter for their members. There are also online groups for writers such as MomWriters (http://www.MomWriters.com) offering networking opportunities as well as camaraderie.


How can we purchase your book?

Bookkeeping Basics for Freelance Writers is available through Amazon.com and my publisher (www.CrystalPress.org). Any local bookstore can order my book by ISBN-10: 0963212389 or ISBN-13: 978-0963212382. List price is $17.95.


Thank you so much Brigitte for joining us today!

Visit Brigitte's "Writers in Business" blog: http://www.writersinbusiness.blogspot.com

Her website, Bookkeeping for Writers, is: http://www.bookkeepingforwriters.com


Tomorrow, June 17th, the VBT-Writers On The Move June Tour continues with Maggie Ball featuring Mayra Calvani!

Guest Post by Dee Barizo: 4 Tips for a Successful Freelance Writing Career

A career as a freelance writer can be a roller coaster of a ride; it is not uncommon for many freelancers to feel insecure in their jobs. After all, you might have one really profitable week or month and then the next month be wondering if you will make enough to pay your electricity bill. If you want your writing career to expand beyond just a part-time hobby and into a full-time business, these tips for building a successful freelance writing career will help you become more profitable and keep the writing gigs coming your way.

Tip #1: Treat Your Career as a Business

If you want your writing career to become a profitable small business, then treat it like a business from this point forward. Taking your “job” as a freelance writer seriously is of the utmost importance if you want to be perceived as a professional writer. All correspondence with clients, both potential and existing, should be professional, grammatically free from errors, and a sample of what type of writing you are capable of. As a professional writer, always deliver the best work that you can, and never, ever make a promise to a client that you do not intend to keep. Putting your best foot forward allows you to be singled out as a competent writer that is in demand.

Tip #2: Network with Other Writers

Networking with other people who share your passion for the written word is not only a good way to find more work as a freelancer, but is also motivational. Having a circle of writers to share your thoughts with is like having a water cooler to come to and de-stress. While working at home as a writer can be very rewarding, it can also make one feel isolated from the rest of the world.

Tip #3: Create Passive Income

It is important for a freelance writer to have some streams of passive income coming in so that they can concentrate on landing good-paying writing gigs. If you are working full time from home as a writer, consider building passive income by running your own monetized blog or by creating a few informational products or e-books that can be sold over and over again indefinitely. These types of smaller, less profitable endeavors can generate some income for you while increasing your exposure as a writer and giving you something to do in your free time when you are in between larger projects. Pennies, nickels, and dimes add up fast.

Tip #4: Learn How to Earn

And last of all, follow the Pareto Principle. Eighty percent of the sales you make as a freelance writer will likely come from twenty percent of your client base. Learn how to earn by determining which clients have the potential to become the most profitable and enjoyable for you to work with, and give special care to nurturing a positive relationship with those clients. Make notes on how and when you make the money that you bring in as a successful freelance writer, and avoid projects that may be causing you to waste too much time for too little compensation.

Keep in mind when building your freelance career that any tree that bears sweet fruit needs to be nurtured patiently for a few seasons before you can reap the true benefits of sowing a seed. But once your freelance writing career takes off, the hard work and perseverance you have shown will be greatly rewarded with the financial and personal freedom that comes from being your own boss.

Bio: Dee Barizo is a staff writer for The Best Degrees, an online education resource featuring the top online degrees.

Two Great Resources for Writers

I came across Shannon Buck's blog, How to Live the Freelance Life, mentioned in the recent Writer Gazette newsletter. Shannon is chronicling her first year carving out a career as a freelance writer. Her site is a wonderful resource for writers of all ages and experience levels! You will find a treasure trove of inspiration and information on the writing life.

http://howtolivethefreelancelife.com/

I also highly recommend Krista Barrett's free weekly e-newsletter, Writer Gazette, which you can sign up for at her website. It is chock-full of writing tips, call for submissions, paying markets, contests, and more! A fantastic resource -- no wonder it's been voted the Best Site in Writer's Digest magazine seven of the past eight years!

http://www.writergazette.com/