Holy Yikes! Self-publishing and Tax Law

February 7, 2013February 7, 2013 ~ Nancy E. Shaffer ~ Leave a comment

I published a book last year. I made some dough on it. Not a lot, but enough to generate two 1099-MISC forms from Amazon and Smashwords.

This week, I went to the TurboTax website to do my taxes. 1099-MISC with an amount in box 2, it told me, is either property rental income or business income. Plz to be proceeding to fill out a Schedule C.

I have a business?

So I start in on the schedule C. Business name, business address, business type code. This all seems rather silly. I write fiction from a chair in my living room. Some day, God willing, I might be a self-employed writer, but not right now. I have the proverbial day-job, a full-time job in an urelated field that brings in the majority of my personal income. Now onto the deductions. Oh, yes, I paid some money to get a personal website put up to promote my writing and book. Enter the expenses on that.

Suddenly, my refund, which was not itty-bitty due to mortgage interest, doubled. What. This can’t be correct.

Now, ask some people, this is all perfectly legit–especially if Turbotax ~~lets you do it~~ leads you down the garden path right through it. But I’m not keen on the idea of being audited. So I spent an hour plus today waiting in the queue for TurboTax’s free CPA chat. Schedule C is correct, says my Free CPA. “But it’s not a business,” type I. Free CPA disappears for a moment, then gives me this useful info dump:

“There is quite a bit of law on the distinction between a hobby and a business; but basically you have to record hobby income and you are allowed to deduct the expenses to that hobby, as long as they do not exceed the income. Some of the factors the IRS and the Court looks at as to in the distinction are:

(1) The amount of time you spend at this hobby or business can be a determining factor. If you have other trades or businesses, or if you have employment with someone else, it may be obvious that the activity in question is a hobby because you may not have sufficient available time to devote to the concept of making this activity a business. An example of this was a case in which an attorney was found to be in the business of gambling because he concentrated on his betting activity more than his law practice and his intent was to make a profit.

(2) Your intent in this particular activity also weighs heavily in whether or not the activity is a hobby or a business. intent is usually determined by considering other factors. Do you keep records as though this were a bona fide business? Do you spend sufficient time to show intent to make a profit? Do you advertise? Do you do other things that are characteristic of a person who’s trying to make a living at this activity?

It’s not a cut and dried decision, but if your activity is a business, your best defense of its business nature is to treat it like a business.”

Yeah, legally a hobby, for now.

So I return to Turbotax, enter an expenses write-off equivalent to my sales, and wipe my hands clean.

The Plan

November 3, 2012 ~ Nancy E. Shaffer ~ Leave a comment

I am in the throes of NaNo-Envy, but I am still happy not to be doing NaNo. Yes, a contradiction, but I love the social energy this month brings in what is often such a solitary activity. OTOH, I am feeling under the weather, and I finished the first draft of my novel last Sunday, so… not great timing for me this year.

But I am in earnest planning mode on the second draft and the general outline for the trilogy of novels that is going to emerge from my first draft. I’ve actually been thinking of turning the novel into a series for a while now, because I see a lot of possibilities and stories in the world I am building (still building. I think my story-world was a bit thin in the first draft).

Back in July, I came across an online writing school, the bill-paying day-job of author Holly Lisle, http://novelwritingschool.com/. Other than a one-on-one writing coach and writer’s workshops, I have not taken any “writing classes” in the sense of instruction since I was a teenager/twenty-something. At that age, I was obsessed with learning “how to write fiction” and so never did any actual writing. Experience is the best teacher, IMO. I learned more from writing my first novel, Dis/inhibition, and The Destroyer series than I could have learned in a hundred writing classes. But I figured Lisle’s “How To Write A Series” course might have a few pointers.

I got through the first two of four lessons in July, then RL got in the way. The lesson videos and exercises guide you through the process of identifying what kind of series you will write, planning how it will unfold, etc (although I must say the video transcripts included are FULL of typos….)

So finishing that course is one goal I have set for my post-novel time. I also plan to work through The Plot Whisperer Workbook. Both of these are merely tools to help me focus on plotting and locating strong and weak story elements for the purpose of revision and expansion.

I reviewed the first two lessons of Lisle’s course this week, and realized quickly that a lot of the course exercises could benefit from me gathering together all the “future draft” notes I tucked away while working on the first draft–changes to plot points and characters I envisioned, ideas for expansion. So that is what I am working on now. I’ve got some good ideas brewing, and a LOT of research work ahead of me in physics, mythology, and random bits.

Dis/inhibition paperback gets Ingram distribution

August 10, 2012August 10, 2012 ~ Nancy E. Shaffer ~ Leave a comment

I found these this morning while Googling:

http://www.adlibris.com/se/product.aspx?isbn=1105603709
http://www.libri.de/shop/action/productDetails/19400201/nancy_e_shaffer_dis_inhibition_1105603709.html

There is still an issue with getting the book cover on some of U.S. sites, but I am told that’s being worked on.

“Inhibition is nature’s way of keeping you from doing something really stupid…”

Valerie Running Deer is a brash, brilliant neuroscience graduate student. Elizabeth Baldwin is her uptight, control-freak advisor. Elizabeth and Valerie’s relationship has always been a battle of wills, but when Elizabeth hands over one of Valerie’s original research ideas to another student, Valerie fires the shot that turns their cold war into a hot one: she makes a pass at Elizabeth’s daughter Lisa, a coy, impetuous teen who has been harboring a crush on her.

Valerie’s spiteful impulse is diffused when she starts to fall for Lisa behind Elizabeth’s back, but a confrontation is inevitable. Valerie’s tumultuous journey towards it will entangle her in the circuitous dance of the relationships around her as friends, colleagues, and family struggle to balance need and trust, impulse and restraint. Control freaks. Hot heads.

Timid artists. Impulsive kids. Dis/inhibition explores the complications of self-control both outside and inside the scientific laboratory.

Buy the book

Buy the eBook

The book is also available at Amazon UK and Amazon Canada.

Adventures in Indie Publishing, pt IIa: formatting for print

July 19, 2012 ~ Nancy E. Shaffer ~ Leave a comment

I think the most difficult, grief-inducing part of self-publishing is formatting. I say that because I am still getting into the marketing part, but stay tuned, because I might change my tune later. But I spent a good two months getting my manuscript into a form–no, I take that back–THREE forms–that would deem it acceptable to book distributors.

The three forms are (1) print, (2) eBook ePub, and (3) ePub mobi. Print is pretty self-explanatory, although not easy, necessarily. ePub is the most common eBook format and you can find services that will turn your manuscript into an ePub file, but you have to do some work upfront to not have aforementioned manuscript kicked back to you as “not ready to be turned into an ePub yet.” mobi is just a fancy word for the format used by Amazon Kindle, which in their infinite near-monopoly wisdom is different from every.other.eBook.seller.everywhere, who of course all use ePub.

Print Formatting

Character rising

June 27, 2012 ~ Nancy E. Shaffer ~ Leave a comment

This is an interesting blog entry on what the writer calls “Self-rising characters”–characters who weren’t in the original outline or conception of a story, or who were but were minor at best, who become (spontaneously) fully realized as you are writing because the story needed them, or at the very least, they were a voice inside you somewhere that needed to speak:

http://bookviewcafe.com/blog/2012/06/27/practical-meerkat-returns-on-self-rising-characters/

I never thought of these characters as being a Mary Sue danger, however. And as the author points out, we use that expression way too much and too lazily. There are very few characters labelled ‘Mary Sues’ that actually are one by the actual definition, and sometimes, even if they ARE one, so what? Sometimes, that’s the whole point of the story/character.

But that’s a digression. I have always seen self-rising characters as awesome, because they come from that “Shut up and let the subconscious do the driving” place where your story actually lives. This is why I am a pantser, at least during the first draft, and find outlines so antithetical. The story I really want to tell, and the characters that really need to inhabit it, are locked in a vault on the right side of my brain I can’t access during the very left-brained, top-down, before-hand outlining process.

The main character of my first novel, Valerie, was a self-rising character, stepping out from a cast of a dozen names and descriptions to take over the story and make it her own.

In my new story, I had a young man appear out of nowhere to become a love interest of sorts for one of my main characters, who was supposed to eventually get involved with another guy–a guy who as the story evolved developed no chemistry whatsoever with her.

Self-rising Young Man didn’t appear spontaneously in the story in order to be a love interest, he entered the story to spy on Ms. Main Character, which he did by seducing her. And then they sort of fell for each other. And doesn’t love/lust/hate always read more convincingly when it isn’t forced on a character?

Adventures in Indie* Publishing

June 26, 2012September 4, 2012 ~ Nancy E. Shaffer ~ 1 Comment

Most folks in the writing/publishing bag probably use the term “Indie publishing” to mean small, independent presses that are, for all their smallness, still publishers in the traditional sense: they accept submissions, chose what works they will put out into the world, and then produce and promote them for the author, either in print or electronic form or both.

But I am seeing the phrase thrown around a lot now to signify those who are really self-publishers, authors who do all the work themselves, or at least arrange for and pay for it to be done: writing, formatting, distributing, and marketing.

Original Fiction: Dis/inhibition – character illustrations

January 9, 2012June 1, 2012 ~ Nancy E. Shaffer ~ 15 Comments

Among the things I want to accomplish in 2012 is finally, FINALLY, getting my old novel, Dis/inhibition, out the door and into the world. I decided to go the self-publishing route, which is a lot of work (for me). In addition to formatting the manuscript/book itself and getting to to places that can sell it, I need to do all the promotional/marketing work as well, or at least arrange for it to be done.

One of the things I hope to do is a website. I hired an illustrator last year to do some images of my characters. The plan is to put these on the site, along with some quotes from the story, either by the character in question, or about the character in question by another character, along with information about me and about how to buy the book.

What sort of people do you imagine these are?

Character Illustrations