I’ve talked a lot recently about managing the business side of a writing career, and at several of those talks, I offered to translate the workshop content into a series for my blog. Today, I’m making good on that promise.
In addition to understanding how to write publishable books, authors need to understand how to manage the business of writing.
(Some days, managing the business of writing may feel a lot like herding cats or making the rays line up for dinner…but you really can get it under control!)
In the weeks to come (with a three-week hiatus while I’m traveling in Japan from October 25-November 15), my Wednesday posts will dissect the business side of a writing career, and offer tips for managing the business of writing. The posts will be equally helpful for traditionally published authors and author-publishers (as well as hybrid authors).
The business side of a writing career has four main components: Financial (taxes and tax planning), Organizational (should you incorporate, or not? what about pen names? personal imprints?), Rights Management, and Contracts. We’ll look at each in turn, over several weeks.
Today we’ll start with a look at the financial components authors need to consider, remember, and track as part of a writing career.
In order to manage the financial side of a publishing career, authors need to establish a system for tracking, recording, and managing costs, expenditures, and taxes.
It doesn’t matter whether your record-keeping system is electronic, paper-and-file based, or both. However, every author needs to establish a reliable financial record-keeping system. Reliable tracking systems help authors track tax obligations, publishing-related costs, deductions, & advertising effectiveness.
What Publishing-related Costs and Expenses Should Authors Track?
Short answer: EVERYTHING.
At a minimum, authors should have spreadsheets or files for all money received from, and all money spent on, the author’s publishing career. Publishing receipts (the money you make) should be broken down by work (and by year) for tax planning purposes. Expenditures should also be broken down by book, by year, and by type of expense, in order to help with financial planning.
It’s important to keep good tax records, but detailed records can also help authors determine which expenditures were–and were not–effective at selling books.
In the weeks to come, we’ll break down how to track your publishing financials in more detail. For now – if you haven’t already established a solid, detailed record-keeping system for your publishing career, it’s time to start! Set up a spreadsheet, establish a system, and figure out how to keep track of your costs and receipts in an easily-readable, organized way.
And join me next week, as we dive into the thorny issue of estimated taxes, when authors owe them, and how to ensure they get paid on time.
Remember: it’s never too early, or too late, to take charge of your career and treat your writing as a business.