Taxpayer asks:
While putting together a new group of guest posters for my site, a tax question hit me! Is the time I spend guest posting on other blogs for promotional purposes tax deductible? i.e. I don’t get paid for the post – my only compensation is the link back. But I could be getting paid for the post… so is the amount I charge for that service a marketing business expense?
If it is – I’m sure you have many readers that would be interested!
Thanks so much!
Taxgirl says:
Gosh, I sure wish it was – since I spend so much time writing for other publications and blogs – but it’s not. The IRS likes to match items of deduction with items of income. If they allowed a deduction for the cost of your time, then they’d require you to value the same for purposes of attributing income (the “value” of the article). But they don’t. Since there’s no income component, there’s no deduction.
Even though it feels odd, this is consistent with the IRS’ position on the treatment of services when there’s no compensation throughout the Tax Code. You can’t deduct your time for volunteering, even though it’s valuable, or time spent on services for which you didn’t get paid because you were “stiffed” by a client (hey tax geeks, most of my readers are cash based so no need to write in to tell me how this isn’t *quite* true for accrual based taxpayers).
I do have one piece of good news, though. Any out of pocket expenses related to the piece (i.e. money spent on paid art, research and the like) can be deducted as promotional expenses. So all is not lost!
Thanks for writing in – and good luck with the blog! Guest posting is a great way to promote your blog or services. I’m always happy to accept ideas for guest posts at taxgirl – just drop me a note!
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
Have a question? Ask the taxgirl! – Now on Facebook!
Taxpayer asks:
Hey taxgirl, if I’m a freelancer, buy a desk/chair and try to deduct it is that like begging for an audit? Advice on what to deduct/not?
Taxgirl says:
First of all, I’m psyched! This was my first taxgirl question via twitter! How exciting!
And now for the answer! The short answer is yes, deduct away.
Working from home or freelancing is tough because you have to supply everything yourself – from furniture to computers to office supplies. You are also responsible for your own benefits, such as health insurance. But the good news is that because you have to spend money to make money, these things are deductible.
The easy way to get started with deductions is to walk through your day and take stock of all of your expenses – from post-it notes to train tickets. Ask yourself which of these expenses you would NOT be responsible for if you weren’t freelancing or working from home… You wouldn’t include meals, for example, because you have to eat, working or not. But you would include business cards, computers and the like. A good rule of thumb then, is to think about what is “ordinary” and “necessary” for you to operate your business (those are the terms that the IRS likes to use) and start your deduction list from that point.
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Taxpayer asks:
Dear taxgirl,
I am confused. I saw your post about amazon.com and sales tax in New York. I live in New York. Do I have to collect sales tax now for amazon? What about my other affiliate sites? Help! I think I am doing something wrong.
Taxgirl says:
The post that you’re referring to is here.
It is confusing – but that’s because the position that New York is taking is pretty groundbreaking. Basically, New York claims that any affiliates living in the state of New York are the equivalent of virtual “door to door” salespeople and thus, the parent company is subject to sales tax.
The good news is that you don’t have to do anything. If you are located in New York (and any other state that takes a similar position), this makes the parent company (Amazon.com, for example) responsible for collecting the sales tax. You will not be responsible for collecting sales tax on purchases made through an affiliate site.
The bad news is that some companies, like Overstock.com, have decided that makes the affiliate programs more trouble than they’re worth and have pulled the programs where they might be subject to tax.
I’m not sure what will come of the lawsuits filed by Amazon.com, Overstock.com and the like. One thing, however, is certain: access to the internet is changing our world. The very fact that I can order a tree from Oklahoma with the click of a mouse (I did this recently) changes the economic picture. This will certainly affect our tax structure.
My advice? Read all of those emails and flyers that you get in the mail (or email) from parent sites. They may contain important tax information or other changes in the way that your parent company conducts business with you as an affiliate. And if you have any questions about your reporting or other requirements, make sure to consult with your tax professional.
It’s a confusing time for a lot of folks – we’ll just have to wait and see what happens in New York!
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
Have a question? Ask the taxgirl!
It’s a mere two weeks until BlogHer! I’m excited! I had a great conference call with my co-speakers (Sabrina Parsons and Linsey Krolik) this week, that is, until I got up while speaking – yeah, I was that excited about tax – and managed to unplug the phone (if you’re wondering who uses corded phones anymore, the answer is lawyers).
More or less, I’m planning on hitting the highlights of taxation and blogging – deductions, affiliate programs, reporting. The plan is to a quick overview and then break it down into quick mini-sessions among the speakers. That should keep things lively enough, no need to bring your (free) espresso.
Not yet signed up? Wha-huh? Why not? It’s tax deductible, it’s fun and there are some really cool folks lined up (despite me). C’mon – all the cool kids are doing it.
