Category: Blogger

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 9: Pay Quarterly Estimated Taxes

Now that you’re making money on your blog, you’ll need to pay quarterly estimated taxes. If you traded in your 9-5 day job for your blog business, you may not have even heard of quarterly estimated taxes. Here’s a quick rundown for you:

If you worked for someone else and received a paycheck, taxes were already withheld and you didn’t have to worry about them. However, if you’re self-employed, you’re still required to pay those taxes. Those come in the form of quarterly estimated taxes. Quarterly estimated taxes cover social security, federal, and state taxes. You’ll need to pay quarterly taxes if you anticipate having a tax bill of $1,000 or more for your blog this tax year.

Here’s how to pay quarterly estimated taxes for your blog business:

Use Form 1040-ES to estimate how much you owe. A good rule of thumb is to take what your projected income is for the year, and divide by four. Take that number and multiply by 15%. This is the amount you’ll owe the IRS for your quarterly taxes. This amount is not exact though, and you’ll need to reference last years’ tax returns and follow the instructions on Form 1040-ES to determine how much you owe.
Quarterly estimated taxes are due on April 18th, June 15th, September 15th, and January 17th 2016. You can pay all four installments by April 18th, or submit your quarterly payment by each of these deadlines. The IRS allows you to pay quarterly estimated taxes online, by phone, or by mail.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 8: Invest in Your Blogging Business

You’ve probably heard the old adage, “You have to spend money to make money.” This adage is just as true for the blogging business as any other business. If you want to turn your blogging hobby into a legitimate business, you have to invest a little bit of money to make it happen. However, that doesn’t mean you have to throw your money at every opportunity that comes along.

Here are a few smart ways to invest in your blogging business without breaking the bank:

Domain name. In order for your blog to be recognized as professional, you’ll have to ditch the “.blogspot” or “.wordpress” in your domain name. Sites like BlueHost offer domain hosting for as little as $3.95 a month. If you don’t want to pay a monthly fee, buy multiple years worth of hosting up front. Most hosting sites will refund you if you cancel your subscription early.
A professional look. Whether you choose to hire a graphic designer, web designer, or simply do it yourself, you’ll need to spend a little money to get your site looking beautiful and working properly. A logo helps brand your business and helps your following recognize your blog. This investment ranges anywhere from $50 to thousands, depending on your budget.
A nice camera. You don’t have to spend thousands of dollars to get a crisp photo for your blog posts. However, a nice camera that can produce high-quality photos is a smart investment for your blogging business. You can deduct your camera purchase on your taxes all in one year, or if you spent a bit more on it, you can depreciate it over time.
Conferences and trainings. If you read part one of our Business of Blogging series, you know not to expect to make millions of dollars overnight. There’s a huge learning curve to blogging, and you need to know what you’re doing in order to make money. Blog conferences are a great way to learn the basics and are a smart investment for your blog business.
Professional headshots. Other than your logo, your headshot is the representation of your blog. Most bloggers use their headshots for their social media profiles, so it’s important that you’re happy with it. You can take your own, but if you don’t know your way around a camera, it’s not a bad investment to hire a professional.
Business cards. Not everyone you meet who is a potential supporter of your blog will actually be through your blog. Having business cards handy will is a great way to advertise your blog and keep you at the forefront of potential sponsors’ minds. Business cards are also great to hand out to other bloggers, especially at conferences. They’re a relatively inexpensive business investment, but critical to success.
Editing software. Free programs such as PicMonkey are great, but many bloggers choose to invest in professional editing/designing software such as Photoshop or Illustrator. Adobe subscriptions range from $20 a` month to $50 a month, or you could even purchase one of the older CS versions on a disc for your blog business.
A professional accountant. Not just because you’re here reading an accounting blog! When you start making money on your blog, tracking expenses and filing taxes properly can become a huge hassle. This is especially true if you have multiple streams of income for your blog. Consider investing in the services of an accountant to help make your blog as profitable as possible.

While this is not an all-inclusive list of smart investments for your blogging business, it’s a great start for the novice blogger. The best part about all of the above investments is that they are tax-deductible and will reduce your taxable income at the end of the year.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 7: Create a Budget for Your Blog

Whether you’re brand new at blogging, or you’ve been at it for a while, the importance of creating and sticking to a budget for your blog cannot be overemphasized. A blog business can be inexpensive to run and highly profitable, or just the opposite. Keeping close track of your blog finances is just the ticket to maximize those profits.

Here’s how to create a budget for your blog in a few simple steps:

Decide on your method. The budget for your blog doesn’t have to be anything fancy or over the top. It can be scratched out on paper with a pencil, laid out in a spreadsheet, or created using business accounting software, like Quickbooks. It’s best to determine a length of time your budget will be used for, whether it be monthly, quarterly, or annually. However, keeping a monthly budget for your blog is the best way to stay on track and monitor expenses closely, so if you create a longer budget, plan to track monthly expenses as well.
Plan for expenses. A blog budget is viewed and tracked in a spreadsheet form. If you begin with a one page spreadsheet, the first category you’ll want to put in is your fixed expenses. These will include any subscription expenses, domain hosting, monthly costs of maintaining your blog, portions of your internet and phone bill, and the like. Next are your variable expenses which would include things like materials for certain blog posts, conference fees, graphic design fees, etc. Basically anything that changes from month to month will go into your variable expenses.
Lay out your Budgeted Expenses. You can determine your budgeted expenses by averaging past expenses in each category. These expenses will likely change from month to month as different needs for your business arise. If you are just starting your blog, you may want to invest more up front to get things up and running, or you might choose to wait until your blog is more profitable to invest more money. Either way, these expenses need to be factored into the budget for your blog.
Forecast your monthly revenue and place it in a subheading called budgeted income. Then, at the end of the month add up what you made from your blog. Be sure to factor in all your streams of income, such as ads, sponsored posts, Google Adsense, Blog Her, Etsy shop, services, etc. Place you actual expenses and actual income in a column next to the budgeted sections and compare the two at the end of the month.
Determine the difference between budgeted income/expenses and actual income/expenses. You’ll want to calculate the difference between the two and place the figures in a difference column off to the side. This is the number you’ll want to reflect on at the end of each month. By determining the reason for the difference, you can either identify a potential problem and fix it, or capitalize on a potential opportunity you had not noticed. Ideally, you’re actual expenses come in at less than your budgeted expenses, and vice versa for income.
Adjust Accordingly. It is important to identify why your budgeted and actual expenses and income don’t match and make changes accordingly in next month’s small business budget. You may need to spend more during some months, and you may also plan to make less in other months.

While creating a budget for your blog is completely doable for any blogger, it’s best to consult a professional CPA or financial advisor to help you get started on your budget and factor in any important legal and financial obligations you may have with the IRS. Keeping track of your blog income and expenses will help you be as profitable as possible.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 5: Create and Maintain an Organized Bookkeeping System (AKA: Mazuma’s Secret Bookkeeping Formula)

An organized bookkeeping system is arguably the most critical component of monetizing a blog business. It doesn’t matter if you’re making boocoo bucks on your blog if you aren’t tracking money coming in and money going out. Here’s how we suggest you manage your time when you’re taking care of your own small business bookkeeping and accounting tasks.

Mazuma’s Secret Bookkeeping Formula

If you’re a blogger, you’re likely a list person. You like schedules, checklists, and organization. If you’re feeling overwhelmed with the bookkeeping part of your blog, here’s a simple formula that when followed closely, will limit time spent and increase profits for your business.

30 minutes / week

Schedule 30 minutes each week to do the following:

Gather all receipts spent on blog-related items that week and make note of what they were for.
Jot down miles driven for your blog business if you’re planning to use those an expense for taxes.
Review your ad revenue and make notes
Enter everything into a bookkeeping program–whether it’s an excel spreadsheet or something fancier, you must keep track.

1 hour / month

File all receipts from the month. To learn more about filing receipts digitally, visit this post.
Review all your entries for the month in your bookkeeping program.
Add up your income and expenses for the month to determine profit.
Compare to your anticipated budget and adjust where necessary.
Pay bills and send invoices.
Adjust for the next month.

1 hour / quarter

Review income and expenses for the quarter and enter into bookkeeping program.
Determine how much you owe and pay your estimated quarterly taxes.
Make changes to your budget and plan spending for the next 3 months.

2 hours / year

Review your yearly income and expenses.
Create a budget for the next year based on last year’s budget and anticipated growth.
Schedule time for weekly, monthly, quarterly, and yearly bookkeeping tasks.

Follow this bookkeeping schedule and you’re sure to stay on top of your blogging finances. When you’re blog business becomes too large to manage, you might consider outsourcing those services to save yourself time and money.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 4: Start Making Money on Your Blog

If you’re creating engaging content on your blog, employing proven SEO strategies, and using great images on your posts, you’re ready to start making money on your blog! Most bloggers know what catches a reader’s eye because they’ve been consumers of great blogs long before they started their own. But behind all the beautiful images and interesting, witty copy, there is a money-making business.

Here are a few ways to start making money on your blog:

Advertising: Companies will pay you to advertise their products on your website. Sounds easy enough, right? Ads should be relevant to your readers, but not overwhelm your content. The most popular ad network is Google Adsense, which is relatively easy to get into and set up. You can also use other ad networks such as BlogHer, Beacon Ads, Federated Media, Sovrn, Media.net, Rivit and Sway. Advertising doesn’t create the revenue that it did a few years ago, but many bloggers still find success with it. Hosting ads on your blog is a great way for you as a novice blogger to start making money on your blog.
Sponsored Posts: If you have a decent following on your blog, then you can contact companies and see if they’re interested in sponsoring one of your posts. It’s usually best to start with companies whose products you already use. They’ll likely want to know your monthly page views and how far-reaching their potential sponsorship will be. Hint: Contact their media relations person directly. A quick way to find out who that is to contact at that company is to send them a quick tweet on Twitter–”yoo-hoo! Who do I contact about xyz.” This might result in a quicker response than an email.
Affiliate Links: An affiliate link is a hyperlink on your blog or post that contains the ID of a product another company is trying to sell. Advertisers track how much traffic comes from the hyperlink on your blog. If a visitor from your site buys the product you advertised, you receive a portion of sales.
Digital Products: Why not use your blog to sell your own products instead of someone else’s? When you sell your own products you don’t have to share the profits with anyone else. Popular digital products for bloggers to sell include printables, digital courses, E-books, photos (stock photography is great,) the options are endless. Just make sure your products align with your blog’s purpose and mission.
Services: Are you an SEO master? How about a graphic designer, web designer, social media manager? You can offer your services to fellow bloggers by creating branding for their business, building a custom WordPress template or helping them monetize their Pinterest account.
Physical Products: In addition to selling digital products, you can start making money on your blog by selling physical products. If you run a craft blog, sell your crafts on Etsy. If you’re cooking up something in the kitchen, create a cookbook to sell. Consider selling clothing with your branding on it, or any other physical item associated with your blog that your readers might be interested in.

How do you make money on your blog? Drop a line in the comments below and help us add to this list.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

The Business of Blogging Part 3: Obtain Proper Licenses and a Tax ID Number

If you’ve already formed your business entity, the next step in turning your blog into a small business is to obtain a business license. Different cities and states require different licenses, so the licenses you need to obtain depend on your area.

- Business License: The SBA has a guide on which federal and state licenses you need to obtain for your small business. Most bloggers do not need to obtain a federal license to do business, but most states do require bloggers to have a general business license.
- Sales Tax Permit: If you are selling goods or services on your blog, you may need to get a sales tax license or permit. Contact your state’s department of revenue or taxation to find out if you need to apply for a sales tax permit or resale number. You’ll typically need one if you sell, rent or lease goods or provide a taxable service on your blog.
- Home Occupation Permit: If you’re running your blog exclusively from your home, you’ll likely also need a Home Occupation Permit. Read more about home-based businesses on the SBA website for more guidance on what you need to legally operate out of your home. All of the above licenses and permits can be obtained from your local government website.
- Employer Identification or Tax ID Number. You will be required to obtain an EIN for your blog. For more information on how to do this, visit this post. Your EIN is a one-time request and is good for the life of your business.

You’ll want to make sure you keep up on the renewal dates of your business licenses and permits. Most require renewal every year, and you should be reminded by mail of your renewal date. Keep track of licensing and renewal fees as those are tax deductible.

After you form your business entity and obtain proper licenses, you’re ready to start blogging as an actual business! However, your small business obligations do not end here. There are several maintenance responsibilities that must be kept up on such as estimated quarterly taxes, accounting and small business bookkeeping, and filing taxes as a business.

Love this post in our Business of Blogging Series? You might also enjoy:

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business

Separating the Blogging Myths from the Blogging Truths

Interested in Learning More?

Schedule a free consultation with our team!

The Business of Blogging Part 2: Decide on a Business Entity

In Part 1 of our Turn Your Blog Into a Business series, we debunked the most common myths behind blogging as a business. If you’re serious about turning your blog into a small business, you’ll need to get legal in order to properly file taxes and avoid trouble with the IRS later on. While opening a legitimate small business may seem intimidating and a little scary, it’s actually fairly easy to do.

The first step in turning your blog into a small business is deciding on and forming a business entity. There are three common entities bloggers choose from: Sole Proprietor, LLC, and S. Corporation.

Sole Proprietor

Most bloggers form a Sole Proprietorship when they’re just starting out. This means that you own and operate the business by yourself, and are responsible for all profits, losses, and debts. You may already be running a sole proprietorship without knowing it if you’re making money from your blog.

When it comes to taxes, sole proprietors files as individuals and use a Schedule C form, in addition to a standard Form 1040. Sole proprietors are accountable for withholding and paying taxes, including self-employment and estimated quarterly taxes. add links

No legal paperwork is needed to form a sole proprietorship, but your city or state may require you to obtain a business license. To see what business license(s) you may need to obtain depending on your area, visit the SBA website.

The advantages to forming a sole proprietorship for your blogging business are that it is the least expensive entity to form, you have complete control of the business, and tax preparation is quick and easy.

LLC

A Limited Liability Corporation (LLC) is also a good option for bloggers. While an LLC is a little more expensive to form, an LLC offers liability protection that a sole proprietorship does not. It allows you to separate your business assets from your personal assets.

If your business is sued or runs into financial trouble, the business will be responsible (and not you personally). In addition, forming a corporation or LLC may lower your tax bill.

An LLC must be registered in the state where it does business. Each state varies slightly, but in general they all require you to choose a distinct name and to file articles of organization.

The “articles of organization” is a document that legitimizes your LLC. It includes information like your business name, address, and the names of its members. For most states, you file with the Secretary of State. However, other states may require that you file with a different office such as the State Corporation Commission, Department of Commerce and Consumer Affairs, Department of Consumer and Regulatory Affairs, or the Division of Corporations & Commercial Code. Many states charge a filing fee for the articles of organization.

For a single owned LLC, taxes are filed just like a sole proprietor. An LLC with multiple members would file a Form 1065 to establish a partnership.

The IRS guide to Limited Liability Companies provides all relevant tax forms and additional information regarding their purpose and use.

S. Corporation

An S Corp is similar to an LLC in that it is treated as its own entity separate from the individual. Members of an S corporation pay income tax on the wages they receive and must have regularly scheduled director and shareholder meetings. S Corps are more expensive to form and require more maintenance as a business entity. They are generally not recommended for bloggers who are just starting their small business.

For more information on the different types of business entities, visit the SBA website. Need help choosing which type of business entity is best for your blog? We can help!

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Start Making Money on Your Blog

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Tracking Blog Expenses the Right Way

How to Create a Budget for Your Blog

Making Smart Investments in Your Blog Business

Paying Estimated Quarterly Taxes for Your Blog Business

Hiring an Expert to Manage Your Blog Finances

Interested in Learning More?

Schedule a free consultation with our team!

The Business of Blogging Part 1: Separate the Blogging Myths from the Blogging Truths

You’ve been blogging for a while now and realize that more people than just your grandma are reading your posts. In fact, you’ve earned yourself an impressive audience. It sparks a little idea in your mind…what if I could make money from my blogging hobby?

Now what?

The internet is a huge space. There are over 70 million blogs in existence and 95% of those blogs are abandoned. There is room for you. For your blog. And you can finally make money doing what you’re passionate about if you’re willing to put forth a few hours a day and a whole lot of effort. If you’re ready to take your blog to the next level, we’ll walking you through the steps to make it happen.

The first order of business is to separate the blogging myths from the blogging truths. There are plenty of people out there who can tell you how great of a writer/crafter/stylist/chef you are and that you’re sure to be an instant success, but there’s a little more to it than that.

Here are the top three blogging myths and the truths behind them:

Myth #1: It’d be awesome if all you had to do to run a successful blogging business is write killer content, wouldn’t it? Unfortunately, that isn’t reality. There are plenty of bloggers who are smart, crafty, passionate, thrifty, have great style, and enough skill to compose inspiring posts about what they love. Those bloggers, however, are not the ones making full-time incomes from their website. Maybe this is where you’re at. Allow us to gently burst your bubble and inform you that it takes more than great content to make money from a blog. There is a lot more behind the scenes work done for successful blogs, and many bloggers work a full-time schedule, and then some. Understand that you will spend thousands of hours collaborating, negotiating, advertising, designing, posting on social media, and employing SEO strategies to get your blog seen by a large audience. Don’t bank on your writing skills alone; you simply cannot build a successful blogging business without putting in the work.

Myth #2: All it will take is one viral post for your blog to be a success. There are success stories where this is the case, but those are the exception, not the rule. Don’t plan on your blog taking off and making millions, even if one of your posts goes viral. You’ll need plenty of quality content, proper SEO tactics, and probably a little bit of investment money to make your blog a success. In addition to one (or lots!) of viral posts, you’ll need to have a highly functional and user-friendly website that is attractive in design and style, as well as some business management techniques to build a genuinely successful blogging business.

Myth #3: You will make a lot of money in a short amount of time as soon as you turn your blog into an official business. A lot of new bloggers buy into this myth, and it’s easy to do. Often times bloggers focus on their own content and what they are doing, rather than taking some time to watch what others are doing to be successful. There are plenty of people who do what you do and blog about it, but what separates the successful blogs from the abandoned ones is a lot of time and expertise. If you’re serious about your blogging business, you’ll likely need to invest a little bit of money upfront for things like a professional logo design, a website template, your own domain, a business license, and more. Not to worry though, all of these expenses are deductible and can be used to reduce your tax obligation when you go to file taxes.

Successful blogs take a lot of work and a lot of patience to turn into something great. Your blog likely won’t top the “must-read” lists overnight, but with some perseverance, dedication, and a business mindset, you’re sure to see success with it in the long run.

Love this post in our Business of Blogging Series? You might also enjoy:

Obtaining a Tax ID Number and Proper Licenses to Run Your Blog Business

Creating and Maintaining an Organized Bookkeeping System for Your Blog

Paying Estimated Quarterly Taxes for Your Blog Business