Thursday, March 7, 2013

The Early Stages

Yesterday we finally had the first of the long list of starting a business in our hands-the business cards. Yes, writing a book(s) is a business. I'm sure there are those who never thought that their writing novels would turn into a business, but that is one of the end results. 

Next, setting up the LLC and opening up a business account for those checks from Amazon. I'm thinking positive here! And, of course, this time next year, or maybe quarterly I'm not sure, we will be doing business taxes, as well as personal. See, this is what happens when you sell a product to the public. And, It doesn't matter if you self-publish or traditional, you are now an entrepreneur. An exciting prospect, but also a responsible one.

Now we begin to think like a business. Saving all necessary receipts, passing out business cards whenever possible, staying on top of everything that involves owning a business. You even have to draw up your own contracts if you have an artist designing your covers or your website, or a regular editor.

There is a lot to this. I'm grateful that I have owned a business in the past, it helps in getting organized for this one. Not to mention, my sister is a wiz at a lot of this stuff. 

Although I know that most would be excited about this prospect, there are those who can be intimidated by it. No need, one step at a time. And, before you know it you will become a pro and you can say with pride that you are an entrepreneur! 

But, there are certain responsibilities involved, such as making sure you do the above mentioned, and little things, like making sure the software you are working on can be legally downloaded into an ebook...things like that. You don't want to get sued by Microsoft. 

Yeah, I know it's a lot, but it will come together. I'm sure that some of you are saying, all I want to do is write, but I'm sure you have figured out that's not going to be the case. So, for those of you that dream of seeing your books for sale on Amazon, or the book store, this is a 'package' deal. 

Until next week, I hope all of you have a wonderful weekend! I look forward to any comments. Let me know if this is a realization for those of you that write, or even those who haven't realized how much work goes into publishing books!


Love, Lisa

13 comments:

  1. What do you think about getting a business license? I'm not sure what my local laws are, but I'm not quite ready to make my business move yet. I've heard that in some locations authors must get a business license and permits if they work out of their home, but I'm not sure exactly what the deal is about this.

    Lee
    Writers Workshop
    An A to Z Co-host blog

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    1. If you are making money with writing then yes, you need a business licence. You can do this on line through your state. You don't need a permit, just an LLC

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  2. Lisa,

    To comment on what Lee has to say above. When I lived in CA, I owned an environmental business that I ran from my house, and I did have to get a business license from the city. I'm sure all states are different, but this is something to look into to.

    I wish you lots of luck with making that many sales from your book that it would actually cause you to owe taxes on the income. So far, I haven't even gotten close to that. One can dream though, can't they?

    Sunni

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    1. It would be nice to make that much money in sales, but that's why you keep reciepts, for write-offs, like my new computer, ect. If you publish and sell to the public then you will have to become a business.

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  3. Thankfully, here in Calgary anyway, you can do all of this as a sole proprietor, whether using your own name or a DBA name. No need to incorporate, thank God. Did that once. It wasn't all that fun.

    Of course, now is around the time I kind of wish I hadn't shut it down two years ago, but frankly, a corporation isn't going to afford me any additional protection than a sole proprietorship at this stage. I will get media perils insurance long before I spend $1000 to have a lawyer incorporate me (having learned the hard way that doing it yourself is neither smart nor easy) and then suffer through paying a tax accountant $400 to $1000 a year doing the company taxes unless I decide to do them myself ($200 for TurboTax for incorporated businesses).

    I can handle the $100 home and business TurboTax, used when I have a sole proprietorship.

    Of course, I will be getting a business name ($60) at some point in the near future, and just as soon as one of the companies pay me, I'll be getting that Home Occupation Permit that's so important here in Calgary (required if you engage in business within the home, thankfully a one-time fee of $48 unless I move, and I am subject to no other permits unless I decide to sell things from a website or from my home, in which case I pay $140 a year for a retail sales license).

    I thus far don't have any real business expenses. My computer is used mostly for personal use and was bought as such before i started the major writing gig. My old laptop, which was purchased for the aforementioned corporation, was already deducted way back when (not that it helped; it's a pity corporations don't get tax refunds like people do).

    In the end, I recommend everyone make use of the free 30-60 minutes most lawyers provide and talk over the plans and decide which route is best for you. I chose what was best for me at the time. :)

    Things change.

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    1. Yeah, they have sole proprietor here also, but I don't know if I can do that with my sister co-writing with me. We don't need a lawyer to incorporate, we can go through whatever state we live in. Also, we can do our own taxes. We have both done them in the past for a small business. I will have to look into the business in the home one. I've never heard that so I better check it out.

      I know it is different in Canada, but a lot of what you said is similar. Thanks for the heads up and the comment!

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    2. Well, technically we don't need a lawyer to incorporate either. We just need certain documentation that is easier to get from a lawyer than to draft alone (not that I couldn't draft it--I still have the old documentation--or find a place to download it). A sole proprietorship just has less overhead.

      As for taxes, I could file them myself, certainly. I didn't know what I was doing back then. That's a far cry from where I am these days.

      If I were doing a two-person publishing operation, I might consider a corporation. I may also consider a partnership. I can't recall the paperwork necessary to start a partnership in Alberta, though I did take a course that mentioned them some time ago.

      In the end, there are so very many ways to start a business. Working in an insurance agency as a file clerk, I see a lot of businesses. I've seen dozens that started as a sole proprietorship or a partnership (if more than one person was involved) that later incorporated.

      I imagine that will be my road. I will begin as a sole proprietorship (already have my EIN from the IRS for getting rid of that darned withholding tax the IRS imposes upon non-resident aliens) and eventually become a corporation. At that point, I intend to have employees doing some of the nitty-gritty. Finding editors, doing cover design, and the like. Heck, maybe I'll even publish some other people at that point. Who knows?

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  4. The best to you Lisa. When I lived in California, in addition to my counseling practice, I owned a modeling agency, a mechanics school, and a book store. I needed licensing for the latter two, but only DBA for the counseling and model agency business. Have to be careful with respect to the IRS. As a recording artist, my music was sold, without having to register as a DBA, or LLC. I had better pay attention to you regarding book sales. Don't want to rock the boat.I'm also going to research this area. Thanks for the heads up. Blessings.

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    1. Let me know if you come up with something that I should know. I guess I have a few things to check out myself. Thanks for the comment Johnny!

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  5. Writing is a business to facilitate the art. You wrote a nonfiction essay on this topic in a fictionalized style which also made it enjoyable reading.

    Thank you.

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    1. Thanks Daron, and if you have any ideas about this subject fill free to fill me in. Thanks again!

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  6. Lisa,

    I will try to pick the brain of my publishing friend. The one who works for (company not mentioned). She does their contracts, etc. and should know what authors need in Colorado.

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    1. Thanks Robin, that would be great info!

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