This has got to be a world record! Normally (like last year and the year before) I procrastinate on doing my taxes until the day before they are due. Not this year. Nope. This year was different. I knew I didn’t organize as well as I should have throughout 2013 (Bring it on 2014!), so doing taxes was going to require a lot more time. More time digging through boxes of receipts, emails, and bank statements to figure out exactly what all of my expenses for the year were. Let’s just say my office floor had “stepping stones” in between paper gaps. There’s no photos of that. It’s okay though, this year I’ve already devised a plan of action. Because you know, taxes can sometimes be a real *ahem* beach:

I should probably say before I start: In no way am I lawyer (although I pretend I am when I watch Judge Judy), financial advisor, CPA, or any kind of person who can give you legal advice…I’m simply a guy who, after a couple years of filing his taxes as a sole proprietor, has learned a few things about filing taxes.

1. Have someone else do your taxes.

Especially if you are a sole proprietor. Sure it might cost you a couple hundred dollars, but this will ensure that you make no mistakes rather than if you file yourself. Plus, you won’t want to pull all of your hair out. Seriously. My CPA has forms that help me organize my expenses into categories so it’s easy to input a number at the end of the year. He’s also available throughout the year if I have any questions about accounting. I’ve never had the H+R Block experience so I cannot speak on their behalf. Personally, there’s something about going back to the same person every year that makes me feel comfortable. If you’d like his information and you’re in or near Sacramento, fill out the contact form or send me an email: ryan@ryangreenleaf.com

2. Create an account for the sole use of business expenses.

This can be a business credit card or a business debit card account through your bank. It may seem like an obvious choice, but maybe there’s someone out there in the universe that doesn’t have one? Having a business account keeps all personal and business finances separate. At the end of the year, you will have a list of everything you’ve spent for the business…pretty cool right? That doesn’t mean you can throw your receipts away and just rely on the statements, nooooo. Keep every receipt and file it away, scan it, whatever your preference is as long as you have it. That is your proof of the transaction from your bank statement which is what you’ll need if you ever are audited. – Quickbooks can help manage all of this for you.

3. Deposits/Retainers

Many photographers and their clients meet, sign contracts, and put down a deposit or retainer a year before the date of the wedding. So what do we do about the deposits/retainers that the couples give us in 2014 but they aren’t getting married until 2015? Well, that depends if those deposits/retainers are non-refundable. In my contract, if a couple cancels their wedding within 120 days of their wedding, it’s non-refundable and I’ll need to claim that on my taxes. However, if a couple hires me today (signs contract and puts down deposit) but their wedding isn’t until July of 2015, I won’t need to claim that deposit until 2015. Make sense? I thought this was good information to know.

4. Meals and Entertainment

Before potential clients sign their life over in your contract (kidding), you’ll probably go out to eat to talk about their wedding. Buy them a cup of coffee at the consultation. Save those receipts! On your way to their wedding, you may stop and grab some snacks or a bottle of water at a gas station so that your body stays nourished. Keep that receipt! You may also meet up with a fellow photographer friend over lunch to talk about photography/weddings/work/etc. Keep that receipt! You’ll be able to write all of those receipts off up to 50%. The only time that you are able to write 100% of it off is if you decide to lets say for example, host/teach a workshop. You invite a group of people and have the lunch catered. Here are some more examples of meals and entertainment that you can write off at 100%.

5. 1099

If you are an independent contractor or self-employed you will receive a 1099 form from each client that pays you at least $600 during the tax year. Let’s say you have an exclusive second shooter working with you at weddings. If you pay them over $600 you’ll need to send them a W-9 form requesting their information in order for you to 1099 them. A question came up in a photography group I’m in…”What if I paid multiple people to shoot with me but their individual payment’s didn’t add up to $600…Do I still claim that on my taxes?” YES. As long as you have proof and documentation that you paid them, you should be okay. Plus, it’s an additional expense for you to write off!

I know a lot of these tips are probably something that most people know. However, if I said things like 1099 form, or W9, or save all of your receipts even if you stop at a gas station on your way to a wedding to myself 4 years ago, you’d probably get a blank stare from me. I’ll probably learn a lot more about them this year too and the key that I’m telling myself to keep my sanity is organization.

Because really, taxes are a game and you just have to learn to play them well.

Happy Monday!