I'm now speaking as a writer and holder of a California DBA since 1996. My first book (out of print now) earned me some money. Averaging it out came to about $1,000 a year. Our CPA said I could charge off on advertising, supplies, long distance phone calls and I went crazy. New computer, new printer, business cards and anything else I could think of - and due to laws at that time, it was all perfectly legal. I could not write off the room in the house that I use as an office as my clothes were in the closet there.
Two years ago, having bought a $1,400 ad for my most recent book, I chortled and handed over the paper work to our accountant, who took a gander at that and at the profits for this book and then burst out laughing. "The IRS doesn't care about anything earned under $600." another gust of laughter and he said, "$58 in royalties? Don't bother them about this."
But: In today's "Ask The Lawyer," I read this tidbit in Sokol's column wondering if it's true that giant pharma gets a tax cut to write off their many (and annoyingly long) TV ads.
Sokol replied: "Companies can often deduct the money they spend on advertising and this cost is considered 'ordinary and recurring expenses for carrying on a trade or business.'" Yeehaw! I have a trade (writer) and I am running a business - Murf Ink."
Mah fellow small business owners, rejoice! Landscapers, order more of those 4/c business cards you put on our front porches to advertise your services! Dog walkers and pet sitters - print more flyers for phone poles in your area! There are almost limitless savings just waiting to be declared!
But: a word - don't try this at home - use an accountant.
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