Tax Tips for Bloggers

SARA F. HAWKINS Attorney at Law

Every week I get a few emails from bloggers or online professionals asking me questions about taxes. Most of them are the same questions again and again. Because I can’t answer fact-specific questions individually without potentially creating an attorney/client relationship, I tend to give the same general answers. First and foremost, seek counsel from a reputable accountant. Unfortunately, I understand, too well, that many accountants don’t understand about how blogging works and some of the nuances related to making money online. And I also understand that finding a tax lawyer who may understand these nuances can be very expensive.

I started out my legal career in the tax group of a boutique firm. I’ve spent thousands of hours working with tax laws. That said, I am not a tax attorney. Through the online world I have gotten to know tax attorneys. One, in particular, is not only an exceptional tax attorney she happens to understand the online and blogging worlds. Kelly Erb is a practicing tax attorney, writes tax-related articles for Forbes magazine, has spoken at BlogHer and is well-known by her pseudonym, TaxGirl. I had the pleasure of speaking with her to clarify my knowledge and get some insight about how the IRS thinks when it comes to bloggers and taxes.

SWAG (Stuff We All Get) – It may surprise you that the IRS defines this as compensation. Of course, while we like to think we hit the trifecta of SWAG bonanzas at blogging events, it was celebrity awards shows that led the IRS to look into this concept of giving people stuff for showing up. Under federal income tax law, such gift bags are treated as taxable income, not gifts, by the IRS since they are not “solely out of affection, respect or similar impulses for the recipients of the gift bags”. This may come as a shock to many people, because despite the fact that bloggers aren’t getting free trips to Tahiti, Botox, and jewel encrusted sunglasses we do get some pretty nice gifts in our conference attendee bags. Are bloggers really claiming the value of their SWAG bag as income? I can’t answer for anyone else. I can only tell you that if you are audited and you’re taking deductions for going to a conference, the IRS has every right to ask you if you claimed the value of the swag as income. Can you argue it away? Sure, but talk to your tax preparer or seek legal advice before doing so.

To read more, see the full article at https://sarafhawkins.com/tax-tips-for-bloggers/

Understanding Influencer Marketing And Why It Is So Effective

Reprinted from Forbes
Author Joel Mathew
President of Fortress Consulting Group

Although influencer marketing is not a new concept within the industry, it has become wildly popular in the past few years. As the world around us becomes more technologically advanced, influencer marketing has made its way to the forefront and companies are devoting more time and effort to the tactic than ever before. As a digital agency that is constantly looking for ways to give our clients an advantage, we recommend and implement influencer marketing as part of a cohesive digital marketing plan to help get brands on the map. More and more, we are seeing our clients shift focus to influencer marketing to propel their brand through social media.

What Is Influencer Marketing?
Influencer marketing is a relationship between a brand and an influencer. The influencer promotes the brand’s products or services through various media outlets such as Instagram and YouTube. Not to be confused with celebrity endorsements, influencer marketing does more than just attach a well-known celebrity to a brand. Influencers must be trusted figures within a niche community and retain a loyal following. In addition, they typically possess knowledge or experience about what they are advertising.

For example, a popular fitness vlogger on YouTube with extensive knowledge in weight training and proper nutrition may be asked to do advertising for sportswear or a supplement company. On occasion, an influencer may not have experience relevant to the product they are advertising. In this situation, they rely on the trust and loyalty they have built within their community to influence their followers. Common influencer categories include adventurists, photographers, food enthusiasts, how-to experts, beauticians, artists, models and comedians to name a few.

Influencers operate independently, creating their own content and integrating a company’s advertising specifications into it. The influencer is in control of the brand’s message, choosing how they would like to portray it. This promotes authenticity and can help reach a specific target audience. The monetary value of an influencer is typically calculated by the size of their social following as well as the platform they are using. On Instagram, industry experts suggest a price point of $1,000 per 100,000 followers. This price should be adjusted further depending on the reach and relevance of your influencer. On YouTube, a price point of $100 per 1,000 views is standard. The beauty of influencer marketing is that anyone can become an influencer, and businesses have a plethora to choose from, allowing them to reach large target audiences.

Why Is Influencer Marketing So Important?
Not long before technological advancements, scheduled television was virtually the only mass media consumers had access to and was one of the main platforms marketers used to advertise to the masses. Today, with the creation of the internet and the popularity of social media platforms like Instagram, Facebook and YouTube, consumers have unlimited freedom and choice over the content they wish to view. This creates a problem for brands. As their target audience continues to spread out over various forms of media, it becomes increasingly difficult to reach them.

As a result, marketers discovered that influencer marketing could offer a solution to the problem. It allows brands to locate and advertise directly to their target audience. Consumers are becoming increasingly skeptical of brands and their marketing tactics, and building trust is crucial. Advertising through influencers allows brands to promote through someone that a niche community watches, engages with and trusts on a daily basis. So, instead of being skeptical of a commercial or social media ad, consumers are trusting that if their influencer of choice loves the product, they will too.

What To Look Out For
Unlike most marketing strategies, influencer marketing requires a high level of trust between a brand and a third party. Although influencers are often required to sign lawful contracts, the care of the brand’s reputation is essentially in their keeping. A brand must be sure the influencer’s content aligns with their overall image. The use of uncanny or offensive content could have negative consequences on the brand’s reputation. This is especially important when working with young influencers who may lack maturity and professionalism.

A company should also be careful of fake followers. An influencer can purchase fake followers, making them appear to have a much larger fan base than they actually do. When picking an influencer, first make sure their followers were obtained organically. Although this can be done manually, it is much easier to use a tool that checks for you, such as InstaCheck. The tool is designed to detect fake accounts by analyzing their engagement, spam and overall activity. There are many platforms available for influencer marketing. We recommend taking a look at Klear, Traackr and HYPR as great starting points.

Quickbooks Alternatives

Ok, so Quickbooks is the go-to accounting software for small business, and there are dozens of versions, tailored for every possible business segment.  So complex and complicated that you really need someone to ,not only guide you through the options, but someone to operate the system.

But what if you are not ready to pick a Quickbooks pathway, not ready to hire a certified quickbooks pro to be your bookkeeper?

I am a fan of Quickbooks, in general.  It is a basic simple checkbook program that has morphed into a more complex accounting program, which is fine but let’s not pretend to is not a more complex accounting program, because it is. Most entrepreneurs will need someone to maintain their books.

Assuming you keep a separate business bank and credit card account, and you’re not ready for journal entries and laser check printing, a simple download of you online bank account to excel or to google drive will give your accountant all they need to create your quarterly and year end statements for tax filings.

For something a little more sophisticated, you might try Quicken, the original electronic check book, cheaper and much easier to use than Quickbooks and you can print your checks too.

For other alternatives check out the article below:

Best Quickbooks Alternatives