Are you a blogger or influencer? Get started on the right foot tracking your blogging income and preparing for tax season with my tips
I hope sharing my experiences, good and bad as a blogger, will make a difference in growing your blog in the future. You will find past blogging posts on my Pinterest blogging board for future reference.
So let’s get busy making your blog grow!
Your blog is growing, you are starting to bring in some income and paying the expenses of your blog. What’s next?
Filing Taxes for Bloggers
Disclosure: I’m not an expert on this topic, so you should consult a tax professional or filing service. My opinion below is from my experience filing taxes for my blog and social media.
The word taxes just makes me cringe and not my favorite time of the year. Since I have a business and we like to itemize, we really have to keep our records straight.
One thing I have learned over the past years is what you have to claim on your yearly 1040 if you blog. If you plan on making or already are making money on your blog or social media, it’s considered a business.
Since the IRS expects you to make a profit when you start a business (blogs are businesses), you are allowed to take advantage of tax deductions for legitimate profits & losses incurred in the operation of your business and also home in the office.
Blogging and claiming are the same as with any other business. You will need to learn about:
- Estimated Taxes
- Self-Employment Taxes
- Deductible Expenses for Bloggers
- Business as a Hobby
I also use Quicken for Home & Business to download my checking account statements, credit card statements and I can keep up with deductions so much easier by categorizing my expenses and income. Quicken is not a yearly subscription but is also a tax deduction.
What do I file?
Any expense that I have to my blog or social media. Example: I needed a new printer which I print out all kinds of stuff for my blog, which is a deduction. Just keep the receipt for your records. Keep all your receipts because you do have to prove you bought that item. If you buy anything online, don’t forget to print your receipt for that item.
Deductions work against your Income you make on your blog and the smaller your income, the less Estimated Taxes and Self-Employment Taxes you have to pay each year. The IRS allows you to show more deductions than income for three years but then decides that you have a hobby rather than a business.
Here are a few popular deductions:
- Blog template
- Your camera & accessories
- Blog related courses or books
- Business cards
- Supplies for any of your DIY projects for your blog
- Domain Fees
- Web host fees
- Computer & accessories
- Fees to prepare your taxes, but if you use tax software that is also deductible
- Any giveaway prizes you paid for out of your pocket
- Hotel expenses for any trips to blog about
- Any blog conferences
There are many other deductions, but I just hit a few.
I have read many different topics on what is considered income for a blog and here is what I gather you claim as income.
- Adsense or any ad Income
- Affiliate Income
- Any payment for a blog post whether its money or gift cards
- All review items, blog conference sponsorships, ad purchases, and generally anything you are given that has value.
On any product I receive for a blog or social media review, I will look up the product online and print out something that shows the price of the item. I did a review for a vacuum I received from a company. I then went to their website and printed out the description of that item and the price.
From the IRS – You have to file an income tax return if your net earnings from self-employment were $400 or more. If your net earnings from self-employment were less than $400, you still have to file an income tax return if you meet any other filing requirement listed in the Form 1040 instructions.
Office in the Home:
Office in the home is such a great deduction when you itemize your taxes. We have 2 rooms in our home which are specifically for our offices. Mr. G also runs his online business from his office. They both have closets to store all our office supplies. The law is clear about having a specified area defined as your office to allow for deductions.
What can you deduct for an Office in the Home:
- Direct expenses – Any expense directly used in your office. Ex: Painting your office, new flooring, office furniture, office equipment & supplies, etc.
- Indirect expenses – Expenses used to maintain your home. Since you are using a percentage of your home for an office, a percentage of your home expenses are allowed. Ex: Utilities, homeowners insurance, general repairs and maintenance, interest and property taxes, rent you pay for your home, depreciation, etc.
Keeping Your Receipts:
It is so important to keep very detailed records and receipts for deductions for your blog business and office in the home.
Every receipt I receive, whether it’s doing a DIY project, going on a trip I will blog about(meals, lodging, gas, mileage), buying ingredients for a recipe, etc. I keep them in my closet using this filing system by using one shelf for expenses, one shelf for printouts of products received to review, and one shelf for income receipts. Depending on the space you have in your office, you could use this or this type of filing system. If you need filing space plus an area for some office equipment, try this option.
After doing this for a few years and knowing what I have to keep and not keep, it does get better and you realize it’s just part of your everyday blogging/social media life.
Here is a great article by Blogging Basics 101 on blogging and taxes.
Don’t Forget to Pin Me
If you have any questions about any of the items discussed, please ask them.
Keep on bloggin!
* * * *
I’m just a country girl loving my geeky life with my wonderful husband, always taking pictures, getting my hands dirty in the garden, being crafty, exploring with travels and enjoying all this on a budget. But above all, living my faith as a child of God!