The Taxman Interrupteth

Posted on Leave a commentPosted in Book Business, publishing, Publishing Fear Free, self-publishing

We interrupt this mini-series of posts from The Editorial Department to discuss a time sensitive matter: taxes.

I can hear your whoops of joy and elation. Everyone loves to talk about federal taxes, right?

Sure you do.

January 31 is the deadline to send 1099s to contractors. We’ll discuss 1099s now, and the remainder of the tax series will be available starting in mid March. (Don’t miss out! Sign up to be notified of each new post in the Book Business series.)

The Basics

A 1099 is a tax form for reporting miscellaneous income to the federal government. One copy goes to the person you hired, and the other goes to the IRS. This person (contractor) could be an author who published their work through your company or a co-author (someone to whom you distribute royalties); an editor, a proofreader, or a graphic designer (someone who provides a business service); or any other business contractor. For more information, go to the IRS website. Here’s a snippet of what you can expect there:

Don’t forget to document your fishing boat proceeds. What!?!?!?!

When you, as an indie publisher, file a 1099, you are essentially informing the government that a portion of your company’s income is actually someone else’s income. Because it is not ultimately your money, you are not required to pay taxes on it. Your contractor is responsible for paying the taxes on their income. A 1099 ensures that the right person (the actual money earner) pays the right taxes.

The key number is $600. If you paid a contractor more than $600 over the course of one calendar year, then you must (as in, you are required by law to) send her a 1099.

Aside from not breaking the law, there are other practical advantages to sending a 1099. A 1099 officially documents your expenditure as a business expense. You are not required to pay taxes on income that is used to pay business expenses. That’s why record-keeping is so important. Save your business receipts!

Again, if you hired a contractor, but paid them less than $600, you are not required by law to send a 1099. You can still claim the expenditure as a business expense, but you are responsible for keeping a record of it yourself. So keep good records. (Did I already mention that?) You are required by law to report all your income whether you earn $5 or $5 million.

The Takeaway

The deadline for filing a 1099 is January 31. To access the form, take a fun-filled trip to the IRS website.

$600 is the number to remember. If you paid $600 or more in one calendar year to one person/company in business expenses, then the law requires you to send them a 1099. If you paid them $599.99 or less in a single year, you do not have to send a 1099.

Disclaimer: Don’t trust me. Go to IRS.gov and confirm the information for yourself. I’m not responsible if you get audited. Also, state income taxes are separate beasts, and you’ll have to tame them for yourselves unless you are fortunate enough to live in a state without them.

 


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The Editorial Department (Part 1)

Posted on Leave a commentPosted in Book Business, Business Basics for Authors, editing, publishing, Publishing Fear Free, self-publishing

Any publishing venture starts with a book. I assume you have already a manuscript either in progress or completed and that you plan to make your book available through one or more publishing portals. Because this series focuses on the business aspects of book publishing, we’re not going to cover the how-tos of book creation in depth. If you would like to know how I write, read here. If you need more information on self-publishing portals, please check out my post here.

Let’s begin our discussion of your Book Business in the Editorial Department.

The most critical part of the pre-publication process is editing. In reviews, readers can leave all sorts of opinions about your characters, plot, and style, but those facets of a book are subjective, open to interpretation. But reviews can also contain objective, provable feedback about typos and spelling and grammar errors. Poor editing stands out, but writers can take simple steps to prevent embarrassing typos by hiring professional editors.

You cannot proofread your own work. I don’t care who you are, at a certain point, you become so familiar with your writing that your mind supplies words/letters/phrases that may actually be missing from your manuscript. I worked as a professional editor for more than ten years, and I hire professionals to edit my work. I cannot do it myself.

Spellcheck isn’t going to cut it. Spellcheck may be wonderful at fixing simple spelling errors and typos, but it cannot yet tell you if you’ve used the wrong word entirely. Consider this screenshot my friend sent me from USA Today:

Yikes! Don’t let this happen to you.

Because “pubic” is spelled correctly, spellcheck did not indicate a problem. But clearly there is a big problem here. No one can dispute that is wrong and careless, and errors like that devalue your product. Good editing is worth the cost.

Money Saver: Beta readers (knowledgeable friends who read and critique your work) can save money. However, use them with care. Sometimes friends may not feel comfortable being as honest as necessary to help you create your best work possible. You need a critic, not a yes-man. Betas also may not have developed the skills to asses a manuscript problem and offer a solution. Beta readers can be great as long as you know they come with risks.

Pro Tip: Hire a Professional Editor

When in doubt, hire a pro. Before I became a full-time writer, I worked as a freelance editor, and before that, I worked as a copy editor at a small press, so I’ve been on both sides of the author/editor relationship. There a few simple steps that can help smooth the road for both parties.

Contract Matters

  • Get a sample edit. Before entering a service contract with an editor, get a sample edit. Send the editor some pages and ask them to perform the service you need—proofing, copy editing, story editing—on those pages. This will benefit you because you will know exactly what you are getting beforehand, and it will help the editor know what level of work is required for your manuscript.
  • Get a contract in writing. This is a business deal, so be smart and protect your interests. This should include the level of service, fees, and timetables.
  • Never send the full payment up front. When I freelanced, I asked for half the cost up front and half upon completion. That protected both parties.
  • Agree on a deadline. The editor should have a time limit. The contract can’t go on forever. You have a deadline, and you don’t need the editor sloughing your work off for a higher paying job.
  • Make sure you understand how your fee will be determined.

Fee Calculation

  • Per Hour: The theory behind this billing method is the cleaner your manuscript, the less time it will take to edit, and the smaller your bill. Sounds good, but it’s also the least defined method, and you’ll be depending on the editor accurately tracking her time. You won’t know if she’s playing Pong for an hour and billing you for the time she spent bouncing a little hyphen around a screen. If the editor you like uses this method, get some time estimates or build a fee cap into the contract.
  • Per Word: After looking at your sample pages, the editor will give you a fee per word based on the level of editing you request and difficulty of the manuscript. You’ll know ahead of time exactly what you’ll pay.
  • Per Page: Same general concept as the per word system. If you are paying the editor per page, then make sure you understand how pages are calculated. For example, I did it this way: The standard page, typed in Times New Roman (12 pt) with 1 inch margins, holds approximately 250 words. To determine the number of pages in your manuscript, the editor will do a word count of the entire work and divide the total number of words by 250. For example, if your manuscript has 60,000 words, the editor will charge you for 240 pages.

Next, we’ll talk about the different editing levels: what’s involved and what to expect as far as cost.


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The Book Business for Indie Publishers

Posted on Leave a commentPosted in Book Business, Business Basics for Authors, Publishing Fear Free, self-publishing

When you decided to write a book, you might have envisioned selling your work to a traditional publisher and sitting back while the adulation and royalty checks rolled in.

But wait! The market changed, and writers have the option of publishing their own work through various portals, including Kindle Direct Publishing, Nook Press, Kobo, Smashwords, iTunes, and Createspace.

There are many advantages to being an indie publisher:

  • Complete freedom to write the story you want to tell
  • Ability to choose when to release books and at what pace
  • Better royalty rates (Compare 25 percent of net sales receipts on a traditionally published ebook to 70 percent on list price for indie books.)
  • Ability to choose price and change it at will
  • Control over all aspects of book design and marketing
  • The chance to make a living writing and not just be a starving artist

Writing is an art; publishing is a business. Many new writers might not realize that the decision to publish independently comes with all the business responsibilities normally handled by a traditional publishing company. You are not only the writer, but you must deal with all the duties of your very own small business. You assume all the financial risk usually taken on by the publishing company, and you have to pay for it all before even knowing if your book will take off.

Plus, as an indie publisher, you are the head of every department you would find in a traditional publishing house:

  • Manuscript Creation and/or Selection
  • Editorial
  • Graphic Design and Typesetting
  • Marketing
  • Finance
  • Payroll
  • Legal
  • Customer Service
Your indie publishing office might be your living room, but it’s still a business.

Book publishing is a business, and if you want the best chance of maximizing your success, you have to do more than write a good book. (And that’s hard enough already.) You also have to take the business aspects of publishing seriously.

In my upcoming blog series, I’m going to share my experiences as an editor in a traditional publishing company, as a self-publisher, and as the publisher of other writers.  I’ll offer an overview of each department and discuss tips for handling their tasks as an indie. If you have any questions, please leave them in the comments below.


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Why I Wrote a Book

Posted on Leave a commentPosted in Absolute Liability, Austenesque, Jane Austen Experience, novel writing, Southern Fraud Series, Writing Fear Free

This is exactly why I decided to go from dreaming of being a writer to actually writing a book. (Grammar Nazis’ heads are spinning after that breach of grammar!)

I wrote Charlotte Collins because I wanted to read a book about her, but no such thing existed. So I wrote it. FYI: You can get the Personages of Pride & Prejudice Collection (Charlotte Collins, Caroline Bingley, and “Maria Lucas”) for only $2.99 . Merry Christmas!

I decided to write Absolute Liability because I wanted to read a crime dramedy, but no such genre existed. There were out-and-out crime comedies, and there were dark, hard-boiled detective stories, but I wanted the best of both worlds. I wanted to read Castle or The Mentalist in novel form. So I wrote them myself.

What book do you want to read that you can’t find?

Have you ever thought of writing it yourself?

If not, tell me what it is. Maybe I’ll write it.