Wednesday, April 23, 2014

Writing as a Business

Thankfully, tax season is behind us, but in early April I followed an interesting exchange of opinions about how the IRS might determine whether you, as a writer, are operating as a business and could (presumably) deduct expenses.  I've seen similar lists before, attended one or two panels on the subject, heard suggestions regarding making a profit at least one year out of five, and so on.  Of course tracking royalties is the fun part of this equation!

However, more than a few of the items on the "IRS" list annoyed me.  (Surprise, surprise.)

"Do you carry on your activities in a business-like manner?  Do you maintain a system to keep track of your expenses/income? (Do you maintain a separate checking account or charge card for business purposes?"

Yes and yes!  I win!  Er, wait.  This was just the first item on the list.  And while I'm not going to go through all of them, I did think it would be fun (ahem) to rant about a few of them.

"Is the time and effort you put into writing indicative of someone attempting to sell a manuscript for profit?"

Let me say it one more time.  I'm a slow writer.  I've always met my contract deadlines, but overall, think of me as a tortoise.  I think it's because I edit so much, plus I work on multiple manuscripts at the same time, so my progress feels sluggish.  But how and why would it be appropriate to compare my time and effort with someone else?  What if my plots are more (or less) complicated; my characters less (or more) developed?  And how in the hell would the IRS be able to judge this?  Can you picture a couple of agents sitting next to you, timing your efforts, then compiling that into a database so it can be compared to the next writer's efforts?  Or filling out a survey?  "It took four days to draft that chapter.  Then I edited it 19 times over the course of three months and changed the character arc of my heroine and added several scenes and then deleted one of them as I scrolled back."  How many hours did that take?  No clue.  But I sit at my computer many hours every day.  And most of us ARE attempting to sell our manuscripts for profit.  Not all.  But most.

"Have you generated a profit from your writing in prior years, and was the profit sufficient?" 

Yes, I've generated a profit.  Was it sufficient?  Hell, no!  Not if you calculate an hourly equivalent.  Do I  care?  Of course.  But that hasn't stopped me nor will it, though it would be nice to make enough to pay the mortgage.  Every month.  (Greedy, eh?  Wanting to pay the mortgage from my royalties.  Every.  Single.  Month.)  In truth, earning that much would provide so much affirmation that I wouldn't be able to stop grinning, which would, of course, trigger unintended consequences.  Children might run away, shrieking in terror.  My dancing in the street could alarm our neighbors, not to mention the cows and horses in the field to the east.  And what about that dark scene I need to write?  I might not be in the appropriate frame of mind to throw enough rocks at my characters, which might keep that manuscript from selling, which means I wouldn't make enough to pay my mortgage, which means I'd stop smiling, which means...  Okay, going in circles now.

"Have you changed your method of operation in an attempt to be more profitable?"

I have changed my methods over the years, but not to be more profitable.  It was simple evolution.  Writing first drafts on the computer instead of long-hand, doing more up-front plotting instead of my long (and beloved) habits as a pantser.  Social networking.  While it's true that I hope networking might entice a few more people to buy my books, I wasn't really thinking about bottom line profit.  Sorry, IRS, to be absolutely honest, the answer is no.  I haven't changed my habits in order to be more profitable.  I've changed them because it makes sense, sometimes because it's fun, but also to help achieve my writing goals.  MY goals.  Not yours.

Enough of their list.  How about mine?  It would be short and sweet, starting with something along the lines of, "How often do you sit down and write?  Virtually every day?  As you also cope with a day job?  And family?  Then OF COURSE you're a writer."

Does our dear old IRS have those questions and that answer on their list?  Nope.  Just dollars and cents.  I know, I know.  My list is simply wishful thinking on my part.  But remember, I do write fiction!

~  Folio


  1. April 15th is the only time I'm happy my writing doesn't make a profit. Thanks for lightening the tax day gloom!

  2. What a timely post, Folio. Yes indeed. How can the IRS understand any creative endeavor that is likely a dollar-losing prospect for years? They can't. And the three out of five year profit thing--I've heard is true and false...well...
    I have plenty of proof (contracts that have fallen through, 10 file cabinets full of drafts, receipts for contests, conferences etc)... I say, Mr. Tax Man, bring it on... would love to dump my receipts into your lap! Inky