Speaker BioKelly Whalen is the author of CentsibleLife (thecentsiblelife.com), a blogdesigned to help you live the life ofyour dreams on a budget.She started her blog 4 years ago, andhas since become both a well-knownmom blogger and a respected voice inthe personal finance realm.Kelly is a mom to 4, and loves that shecan stay at home with her kids, and stillpursue her passions for writing, personalfinance, and social media.
DisclaimerThis presentation and Kelly Whalen’s advice are notintended to take the place of the advice andexpertise of financial advisors, certified publicaccountants, or lawyers.All information shared is intended to be used asguidelines for managing your finances as a smallbusiness and blogger.Please speak to a professional should you havequestions, concerns, or need guidance.
Bookkeeping BasicsTrack your income and expenses in one place.Evaluate income versus expenses monthly.Spend smart-consider long-term value andwhether they are tax-deductible.Know your take-home pay after expenses andtaxes.
When to Set Up Business AccountsIdeally when you start your business.Often considered once you have established earnings beyondyour expenses.Bloggers can operate as:• A ‘hobby business’ is one in which you do not earn money,however you file taxes as a means of offsetting yourloss/expenses.• Sole Proprietors (sole owners)• Limited Liability Corporations or Limited Liability Partnerships(provides legal protection of your personal assets)• Corporations (typically for larger businesses with employees,profits are used to pay shareholders or for profit)• Non-Profits (corporations that use funds to achieve goals asoutlined in their articles of incorporation)
LegalRequirements vary by state. Check your state’s website (orthe state where you’ve filed) to learn more.Tax ID Number: Apply online at http://1.usa.gov/15ezz9DFreelance writing, consulting, etc. can be done as an LLC,Sole Proprietorship, or Corporation.Plan for the ‘end game’ in writing.• What happens when the business closes?• Who gets the business in the event of death?
BankingAlways use a business account that is separate from personalfinances.Type of accounts to consider:• Checking• Savings• Self-Employed IRA or 401k• Business Paypal• Business Credit CardWhat you need to setup accounts varies by state.Consider: Local credit unions.
TaxesTaxes are a large portion of the expense you have a smallbusiness owner and blogger.Taxes include self-employment tax (Social Security andMedicare), income tax, and state and local taxes.Compensation in the form of product, cash, and gift cardsare taxable.Use wholesale pricing for product, not actual retail value.Remember taxes when you accept compensation.Set aside money for taxes. Typically 30-40%. Pay quarterly tothe IRS.
Tax DeductionsConsider tax deductions when spending.Fees, services, business travel, and educational materials aresome examples.Common blogger deductions include:• Domain Fees• Hosting Fees• Design, Consulting, or Freelance Services• Internet Access (% for business use)• Computer or cell phone (% for business use)• Office Space (% of space)
Estimated TaxesIf you received a refund for 2012 in most cases you do not needto pay estimated taxes.If you have a large increases in income consider setting asideextra or paying estimated taxes anyhow.Have a corporate job or a spouse that does? Consider adjustingwithholding (getting less in that paycheck) to offset taxes thatyou will owe.Find dates and information about federal tax due dateshere:http://www.tax.gov/calendar/
Tax deadlinesEstimated Tax Due Dates for 2013• January 15th• April 15th• June 16th• September 17thYearly Taxes Due: April 15th
ResourcesOnline Account Management:Mint (available as an app)Your Bank’s Website (possibly available as an app)PayPal (available as an app)FreshBooks (available as an app)WaveAppApps:ExpensifyShoeboxedOrganization:NeatReceipt (scanner)