Yes, it’s time to start thinking about your taxes. Not your 2016 taxes.
2017 Taxes. This year’s taxes.
Why talk about the taxes you’ll file next year? So you can get the most out of them. Writing is a poor (wo)man’s vocation, so paying little to none in taxes is probably in our best interest.
The main thing to keep in mind is that writing is your business. As such, many things you spend money on are business expenses.
Computer? Yes. Internet bill? Absolutely. Books? Damn right!
There is so very much more than this. Anything that feeds into your work–anything–is a business expense.
For 2016, the one item I’ll be writing off that shocks most writers is my PS4.
I know you’re thinking: How the hell are you writing off a Playstation 4?
Here’s how: The PS4 is a video game console. Since I write dark fantasy, I need to understand my genre. As of this writing, the driving work of dark fantasy is Dark Souls, specifically Dark Souls 3. If I’m going to understand what my potential readers want out of the genre, I need to know what they expect. That means I need to know this game, making it a worthwhile expense to further my writing.
Also! Playstation 4 has networking capabilities. Messaging and Party Chat are nice in this regard, but Twitch is massive in this regard. Because I streamed Dark Souls 3 on Twitch, I developed a character that I’ll be using in an upcoming project. I also get to engage with the public, allowing me to reach out to more potential readers.
Have I convinced you yet? Kevin J. Anderson speaks of writing off Firefly DVDs at conventions. If he can do that, I can certainly write off Dark Souls.
The lesson is this: Anything you spend money on to advance your craft is something you should track. Taxes are compartmentalized, so you need to know what falls into each category.
Mark down the mileage when you drive to a writing convention. Keep a list of how many coffees you drink when you meet with other writers. If you buy a new desk, keep that receipt.
So much of what you spend could be tax-deductible. Please, learn.
More specifics can be found with this Writers Digest article.