Death and Taxes

Aspects of Independent Publishing part seven: Necessary Evils

There are only two certainties in life: Death and Taxes.

As we are in the throes of dying season and as tax season is come upon us, I feel now is a good a time as any to address the unpleasant stuff we, as individuals, don't want to face. We all know you can’t cheat Death, but the IRS believes everyone cheats with their taxes.

Before we go any further, I need to make it very clear that I am not, repeating for emphasis, I AM NOT ANY FORM OF A TAX EXPERT OR TAX PREPARATION PROFESSIONAL. I have a tax professional I employ for one very good reason: the IRS scares the jeebus out of me.

Don’t go to a baker for legal advice. Go see a lawyer.

Don’t go to a grocer for tax advice. Seek a tax expert.

How important is it for a self-published author to seek professional legal and tax advice?

If you’re asking that question, I’d say it was of tantamount importance, and there’s little my blog can offer you.

Shel, why are you bringing this up
if you’re not at least pretending to be an expert on this topic?

Because.

Listen, if your writing goals include the phrase “professional quality” at any stage, it behooves you to treat your writing career and your publishing career like businesses. All businesses have at least these three things in common: paperwork, liability, and fiscal responsibilities.

Get thee a business plan. Get thee a taxman. Get thee a lawyer.

Unpleasant Business #1: Business Plans

This is the one aspect that I’ve harped on about before, so I won’t spend a lot of time on it now. But. If you don’t know where you’re going, any road will get you there. Scope out successful small businesses, not necessarily in the publishing world, and explore their practices. 

• Adopt the practices that work for you, but above all that, establish a business plan. 
• Keep it flexible enough to evolve with the times and the markets, but solid enough that you can follow it daily, weekly, monthly, and annually. If you’re a hybrid author, as in one who publishes traditionally as well as independently, you’ll want a plan in place for when your rights revert back to you. 
• Keep in mind that overnight successes in the publishing world are far from it. There’s a lot of hard work that goes on behind the scenes, sometimes for years. When you ask your favorite indie author “how do you do it?” make sure you’re asking about their business practice as well as their creative process. Not everything they do will work for you, but it’s important to have a strong knowledge of the industry you’re in, about the players that make the system work for them and about the players who struggle while the system controls their product.

Unpleasant Business #2: Taxes

Taxes are necessary evils the world over. We are obligated, some of us even at a religious level, to “Render unto Caesar that which is Caesar’s.” And no one likes an IRS audit. So, if you do nothing else professional in your writing career, at the very least, get thee a taxman.

Shel, we get it.

You’re not a tax professional.

So everybody's on the same page? Good. Let’s look at some of the ways we’re screwed we incur tax liability. And my apologies to my non-United-States readers, as an American, my scope of experience here is limited to the United States. 

Hobbyists vs. the Self-Employed

IRS definitions are found in the intent of your writing goals. Are you dabbling at writing, maybe offering most of your work for free, or entering the odd poetry competition like one enters their pie at a county fair? Or do you have plans to eventually quit your day job and make a living off of your writing alone?

Hobby: one cannot deduct against any income except the income from the hobby.

Say you publish a novel and you receive your 1099 from Amazon that states you earned $1000 for the year off of that novel. You go back through your saved receipts and you see that you shelled out $300 for a cover design, $400 for editing services, $125 for your ISBN, and $525 for a writer’s convention all-weekend workshop pass. You brought $1000 in and paid $1350 out. A hobbyist can only claim $1000 in loss against his income. The hobbyist cannot offset that remaining $350 against his day job income.

So, as a hobbyist, you cannot spend on your hobby more than you earn with your hobby, at least as far as the IRS is concerned.

However, if your writing is a business, you can probably include the $3000 you spent in airfare, hotel, and meals on top of that $525 workshop pass and get a business loss deduction of $3350.

Why is this loss important? It reduces your taxable income then, and therefore, your tax liability. And your tax liability, as a self-employed 1099 anything, is at least 30%. You don’t take those deductions, you owe $300 on that $1000, $150 of which YOU HAVE TO PAY NO MATTER WHAT.

Why? What is that $150?

It’s that pesky thing called a self-employment tax.

What?

Those of us who have ever lost a job, you know that COBRA letter that comes in the mail? You may have only been paying $150 a month for your health insurance while you were working, but under COBRA, you can continue to get your health insurance benefits at full price. So for a mere $800 a month, you can keep your medical benefits. I know, it’s a bad dream.

The self-employment tax is kinda the same thing. Okay, it's completely different, but bear with me here. As an employee at your day job, you are required to contribute a little over 7% to fund Medicare and Social Security and your employer matches that. The result is 15% to Medicare and Social Security. But, being self-employed, you are both your employee and your boss. You are liable for both halves. So, if your writing is a business, you should expect to pay $0.15 on every dollar you earn.

But that 15% is AFTER all your deductions. If you earn $1000, and can deduct $900 in losses, your taxable income is only $100, and at a 15% tax bracket + 15% self-employment tax, the final tax of $30 is much softer to your pocketbook than $300.

Watch it though. The IRS doesn’t like 5 consecutive years of business loss. They’ll suspect you’re hiding your hobby as a business, and will audit accordingly.

Unpleasant Business #3: Death

Even before you hit the publish button, you become a copyright holder. Current copyright law affords protection of your completed or in most cases incomplete work (this area is a little fuzzy for me so don’t quote me here and expect it to stick) whether said work is officially published or not, for your lifetime plus 70 years.

I’m repeating for emphasis: Your lifetime plus 70 years.

At the risk of sounding like a life insurance salesman, what do you have in place to help your loved ones manage your estate? Will your estate end up in probate and tie the hands of your heirs for years while the government tries to sort out the dotted Ts and the crossed Is?

We have a living trust, Shel.
Give us some credit.

Yea! Credit is given as credit is due. But just to make it clear for that someone who isn’t as prepared as you, let’s pretend we’re brand new at this.

A copyright isn’t a tangible thing, like a desk or a lamp. It’s more akin to an idea, and it has a life of its own, one that is guaranteed to outlive you by 70 years. It’s not something one can list among other tangible possessions.

To Aunt Petunia I bequeath 30 pairs of worn socks, my barbed-wire collection, all my copyrights, and the Phil Collins album of her choice from my personal record collection.

The government treats your literary and other creative endeavors differently than they do your barbed-wire collection. And you should, too.

Okay Shel,
what do you have against Aunt Petunia?

Wait, don’t get angry. Aunt Petunia could very well be the best bet for maintaining your literary estate. My suggestion though would be to ask your loved ones, all of them, who would be interested in fostering your writing after your untimely demise. Don’t just dump this responsibility on your kids or your cat because you think they should want the job, and don’t blindside them at the reading of the will either.

Ask them if they have the same vision with your writing that you do. Ask them if they know of an author who could finish a manuscript that you might leave unfinished. Ask them if they want to be in this family business before you shuffle your dusty computer files over to them. Tell them you expect them to be honest in their responses, because this is a 70 year commitment, one that could outlive even them.

It’s a 70 year commitment that will require of them a working knowledge of the publishing industry and the way it evolves so that they can balance between keeping your legacy alive as according to your desires, and staying flexible enough to incorporate new avenues of production that might exist in the future. It’s a 70 year commitment that will require of them the ability to negotiate secondary and tertiary rights agreements to interested movie studios and action figure manufacturing companies.

I would further suggest that you keep your mind open to the idea that the perfect person or persons equipped to handle your literary estate just might not be related to you. Maybe that person or persons come from your literary circle of friends, the ones that helped you publish independently to begin with.

And once you have a good idea as to who you want in charge, make sure you keep them in the loop for the rest of your life. This is a commitment you want to keep fluid and flexible, because times change, and people change.

And get thee a lawyer, one who specializes in literary estates, one you trust. Consider their advice. Discuss your options with all interested parties present. Take an active role in protecting your work and your loved ones. A lawyer doesn't have to cost a lot either. Services like PrePaid Legal can provide top-quality legal eagles for a monthly fee that fits your budget.

It's important to keep in mind that your divorce lawyer isn't a living trust specialist, and your real estate lawyer isn't a criminal defense attorney. Just because your friend knows a good attorney doesn't mean he's going to fit your needs. Like all the professionals you contact, vet him first.

If you have other questions of a non-legal nature about publishing independently, or if you would like a cheer squad to help you walk through the process, feel free to ask me. I’m willing to help where I can. If it takes a village to raise a child, why not a community to publish a book?

Evensong Requiem (WoE #7)

Write at the Merge gives us 500 words to explore the concept of Time.

Alongside a picture of an alarm clock, which didn't spark anything for me, we are provided this quote from The Glass Menagerie:

Time is the longest distance between two places.

--Tennessee Williams 

This quote screams "measuring time" for me and it calls to mind the ringing of bells to mark the canonical hours of religious devotion. I wasn't prepared for where I went with the final product, so I thought I should warn you, this isn't a happy piece. (My Precipice/Bannerwing entry wasn't happy either. I think I need some vitamin B-12 or something.)

Anyway, I offer the following in response: A Evensong Requiem.

The None Bells rang and Brother Gwen set down his quill. He worked the blood back into his hands and slid from his wooden stool to follow the other monks to office. His broken gait pained him, sending burning pulses through his crooked back with each clumsy step. Forty years hunched at his station, with only a single candle to illuminate his work, Brother Gwen prayed for the day he could pass his mantle on.

He joined his brothers in the chant, saddened at his crackled voice. He reached the notes he could with the power he could, but he feared he was failing his office. His mind wandered, remembering his eager days as an initiate. There was infinite possibility under heaven’s watch when his calling was new. Now, he was conquered by his age.

With the None Office concluded, Brother Gwen hobbled to the infirmary instead of returning to the library. Brother Gregory waved him over before he could speak, sending one of his novices to fetch supplies. “Brother Gwen,” the monk helped Gwen onto the straw-thatched bed, “I had not expected you back so soon.”

“Thank you, Brother Gregory. God tests me with the cold and I fear he will not find me worthy.” Gwen allowed the monk to disrobe him to his waist. He had little strength left to manage on his own.

The novice returned with the familiar vial of pungent elixir that had been Gwen’s saving grace these many winter months. Brother Gregory handled the vial with extreme care, tilting the liquid into clean cloth in small dabs, never once touching it with bare fingers. “Monkshood is powerful, and although I have taken steps to reduce its poison, we cannot be overly careful, Brother Gwen.”

Gregory had said this before, Gwen remembered, but as of late, only the ointment relieved any of his pain. He prayed in silence for forgiveness, for being so weak and frail, while Gregory applied the small amount to his sore back. It numbed and soothed, and tingled up his spine. Gwen relaxed, but his breathing became labored and Death's rattle crept into his voice. “Thank you, Brother Gregory.”

The monk frowned and set aside his cloth and vial. “Gwen, you did good to see me. I do not think you will rise again this night.”

Gwen coughed. “That would be the cruelest office of all. I have not finished my last book. God will not receive me as a failure.”

Gregory smiled, “Oh my brother, you are the gentlest of us. You have given us a glimpse of God in the love you bear our order. It is your flesh which fails your soul, not your unfinished deeds.”

“Is it so simple as that?” Gwen gasped a short-lived chuckle and lay down on the bed. “I pray ‘tis so.”

--//--

Brother Gregory promised to wake him for Vespers, but when the bells of Evensong called the brothers to mass, Gwen was already gone.



Some of the WoE crowd mentioned during the assessment that they aren't always sure when it's okay to leave criticism. I'll try to remember to be a better citizen and put a note at the end of my responses to the prompt, but if I don't, comments and constructive critiques are ALWAYS welcome here. Okay? Okay. so, let me have it. Give me what you've got. I can take it. 

It Takes Two: A WoE writing contest.

So, Write on Edge has a special contest going to celebrate the upcoming volume of Precipice. The editors are being tight-lipped about the theme for 3rd year submissions, but this contest is designed to wet our whistle. We have 1,000 words and the following quote from the Great Gatsby:

"It takes two to make an accident." - F. Scott Fitzgerald.

For the record, I'm not a fan of the Great Gatsby. While this literary classic had genius moments, I thought it lacked a defined plot and it certainly head-hopped point-of-view too often for my tastes.

But that has nothing to do with the price of tea in China, or with the rules of engagement concerning this contest.

In addition to the 1k word limit, we can use the quote as an opening/closing line, or simply to draw inspiration from it, then we link up as we usually do. Out of the WoE community who participates, one story will be selected by the editors and another story will be selected by a vote of participants. The two selected stories will be featured in Precipice, volume 3, theme yet to be announced.

Exciting, right?

So I would like to offer the following as my entry.

Taps

  Gone the Sun

The trumpet sounded. Taps haunted the living. The flag was folded with military precision and the captain walked the triangle of starry cloth to an elder woman clad in black. She sat expressionless in a row of crying adults as she received the colors with gloved hands.

Melissa kept her distance, knowing she wasn’t welcome, especially now that her future husband was gone. His mother said the vilest things at the engagement party. Zach promised that it didn’t matter, that his mother’s opinions were base and ugly, but she would eventually come around. And none of it would change how he felt about her.

There was no benefit for Melissa. The Marine Corps didn’t consider her as next of kin. It was the cruelest trick of fate, to dangle the possibility of forever before her eyes, only to rip it away two weeks before the wedding.

Afghanistan couldn’t kill him, though it tried. The heat during the day, the cold during the night, the rabble with a penchant for locking their own in suicide cages, all of it and he still managed to come home well-adjusted and strong. Zach was supposed to be safe in the States. Gunfire disturbed the silence. Melissa forced a breath through her tired lungs, wiped a tear from her cheek, and counted.   Seven rifles times three rounds equaled twenty-one.  

And it was over.

The shadow clad family and friends wore their grief like a shroud and dropped ruby roses after the rosewood casket lowering into the ground. Her vantage point grew stale, yet she remained, numbness returning to her veins. Melissa watched Zach’s mother rise and depart in a sea of supporting arms. She sucked in another breath and whispered her silent argument to the sun for another hour with Zach. Just one more hour, she begged.

“You’re Melissa, right?”

She lowered her head, preparing for the avalanche of ill-will from a tongue under the employ of her would-be-mother-in-law. “I am.”

“I’m Bricker.” He sounded nervous. “Well, my name is Anthony Brickman, but everyone calls me Bricker.”

The name was familiar. She looked up and caught a pair of melancholy eyes, gray like an ocean of storms. “Zach’s…cousin.”

“Yeah.” He flinched. Something was troubling him.

“Nice to meet you. Zach told me a lot about you. I’m sorry for your loss.”

“You’re sorry for my loss?” He gave a humorless laugh. “No wonder he loved you. You were too good for him, you know.”

“You’re wrong.” Her tongue was sharper than she wanted it to be. “He was bloody perfect.”

“He was a better man than me, that’s for sure.” Bricker sniffed and looked away. “It’s my fault you know. My fault he’s gone.”

“That doesn’t make sense. It was an accident.”

“I know it’s not my fault in that respect. But I’m the reason he was there at all. He wouldn’t have been on that bridge if not for me.” His weight shifted on his crutches. “You know that’s enough reason for Aunt Addie to cut me out.”

His tears drew more tears of her own from hiding and fished anger from her soul. “Zach’s mother, she blames you?”

“Can’t say I blame her for that. I mean, I blame myself too, so it’s only natural.”

“It’s not fair that Zach’s gone. I’ve begged every deity in history for a glimpse of what we could’ve had together.” Melissa shook her head. “But you didn’t make that accident happen. And he is the only one gone because the two of you together worked to get everyone out. Time just ran out for him. Time just ran out for us both.”

He was quiet for a long time, which was okay. She needed to process what she had just said. As her emotions tugged at her thoughts like taffy, she watched the Cat scoop earth into Zach’s final resting place. Zach saved thirty-two people that day, twenty-eight of them children, completely emptying the bus before the fire consumed him. Pointing fingers at anyone seemed petty in comparison.

“Look, Bricker,” she reached out and touched his arm. “Zach isn’t the sort – wasn’t the sort – to stand by and watch children perish. The others on that bridge were too busy catching the wreck on their smartphones. But you and Zach…I don’t want Zach to be gone, I want so bad to have my wedding and to live happily after. All those parents though, they all get to wrap their arms around their babies for one more hour. Why on earth would I ever wish this pain on them? No, you did good, Bricker. You both did.”

“It should have been me.” His voice crackled and sputtered. “Zach had so much more to contribute to this world. Can you ever forgive me?”

Melissa wiped the waterfall from her eyes and tried to smile. “There’s nothing to forgive. But if you need to hear the words, I forgive you and I hope someday you can say it to yourself.”

His crutches clattered to the ground. Strong and sudden, his arms engulfed her in a cocoon of a hug. They stood clinging to each other’s warmth in the shadow of Zach’s grave-site. “I’m so sorry, so very sorry,” he repeated like a child over a broken toy.

She began to overheat, feeling sweat bead at the nape of her neck. She kept the hug as long as she dared before giving him a gentle push. “I don’t want to keep you. I know the family is having a small reception at your aunt’s house. But I’m hoping…”

His gray eyes locked her gaze. “Hoping what?”

“Your aunt isn’t the type to be forgiving, no matter how wrong she is, and it’s going to take a long time before she’s willing to budge. Would you like to grab a cup of coffee with me? Maybe some lunch? I’d very much like not to be alone right now.”

He nodded. “I’d like that, too.”