Hey, I’m jet-lagged and getting an early start. It looks like I had $2480.05 of gross income on my Schedule C-EZ (thats where you put stuff for a sole proprietorship, for those not accustomed to US tax returns). That is a fairly exact figure (check Paypal and eSellerate records). Expenses I’m still working on, pouring over credit card statements and Paypal transaction logs looking for additional things to claim. Some decisions I made, so you can giggle at how much penny pinching I do and realize how you can come to great tax savings if you keep copious records:
Winzip license: Deductible. All of my use this year (yep, I made sure) was in opening and closing BingoCardCreator.zip. For personal use I used the built-in Windows functions. $29.95 (saves $4.50 in tax!)
Japanese training software: Not deductible. While I got a blog entry about it it wasn’t incurred as an advertising expense and I don’t think I can fairly say it was training for my business (deductible) as opposed to training for my employment or personal edification (not deductible).
Sharebuilder.com account: Not deductible. While it would have been lovely to get this one ($100+ expense) “my” accountant (a high school buddy who just passed CPA exam and was happy to brag about it over Christmas — hey, I’m cheap) says that even if you invest your business profits it is considered a personal expense. He says if I go legal and have the business do a 401(k), SEP, or something similar, however, that costs involved in starting up those would be deductible. Good to know.
High speed Internet: Not deductible. While I doubt they’d audit little old me I have a level 60 gnome mage who would argue violently that the 50MB/s connection I pay for is not business related. (Sidenote: good thing I don’t have to declare DKP as income.)
Robosoft: Hella deductible. I had totally forgotten about this expenditure until I was browsing my blog’s “stats” category looking for stuff I had missed. $99 expenditure = $15 tax savings. Not bad for 2 minutes of work.
Things I did end up deducting:
CPC ads from Google and Yahoo, TextLinkAds, Winzip license, Stuffit license, RentACoder fee for Mac port, Paypal commission, BitsDuJour commission, cd-fulfillment.com costs, Robosoft, and refunds to customers.
I’ll give you the birds-eye view of my Schedule C-EZ when its over with. I would show you how it fits in the 1040 except its not likely to be useful to most of you (how many folks make most of their income from an excludable foreign source?) and I’m not comfortable waving around my salary numbers for the day job.
