Matt Forbeck's Blog, page 56

Writing and Taxes

To make a living at anything — even, maybe especially, writing — you need to treat it like what it is: a business. As soon as you start relying on the money coming in from that activity, it leaps out of the realm of being a hobby and transforms into something you ought to take seriously, especially if you think not living out of your car or sleeping on your parents' couch is a good thing. Part of that means thinking about how to structure your business and what that means for you come Tax Day every year.

(If I haven't lost you already, then hold onto your hats. This is where it starts to get technical.)

When you start out freelancing, one of the happiest days is the one when your first check arrives in the mail. Some people frame it, which is exactly what your publisher hopes for because that means you'll never cash it. Others bring it to their local pub, cash it, and spend every penny of it right there. (Don't worry for your liver. Most first checks aren't for much.) The rest stick it in their checking account and cackle all the way home.

Come tax time, though, you realize that not all of that money is yours. Just as with the money you earn from any regular job, Uncle Sam wants his cut of that check, and if you already spent it then it's up to you pony up the cash out of your pocket.

Most of the time, it's not a big deal. You just tack that extra bit onto whatever your standard tax bill might be or, better yet, knock it off your refund. Once you start making decent money at writing, though, you may be in for a rude surprise.

When you get to the point at which you're making enough cash at your writing that you'd owe at least $1,000 in taxes on it, then it's time to get serious. At that point, you need to start making estimated quarterly payments on your taxes, or you'll get stuck with a penalty at the end of the year. Your first year, the government can give you a mulligan on the penalty if you didn't owe any taxes at the end of the previous year, but don't depend on this without the advice of an accountant.

The alternative to making estimated payments is having more money withheld from your paycheck at your day job. If you're married and file jointly, you can have your spouse do this for you instead. This makes it easier to stomach paying the money because it's removed from the paycheck before it reaches you, and it's taken in smaller amounts than you'd have to pay on a quarterly basis. Also, you won't forget about the taxes and spend that money before the bill comes due.

When you sit down to figure out how much you should set aside, no matter what method you use, you'll likely be in for a good shock in the form of something called self-employment tax. When you work for someone else, you pay half of your payroll taxes (Social Security and Medicare), and your employer pays the other half. When you work for yourself (as you do for those freelance checks), you get to pony up for both halves of the bill.

For 2011, the US Government actually reduced the self-employment tax a bit to give small businesses a bit of a break. It's normally been 15.3%, but for money earned this year it's 13.3% instead.

About 11 years ago, I incorporated my writing business to help with this. There are lots of reasons to form a company once you're cooking, but the tax benefits are one of them.

I set up an S-corp called Full Moon Enterprises, and I run all of my freelance writing through it. I pay myself a reasonable salary (adjust "reasonable" for whatever field you're working in) and then take any extra profits the company generates as a dividend. The good thing about that is that I don't pay any payroll taxes on those dividends, just my standard income tax. I can also raise or lower the extra withholding as I like, depending on how well I'm doing throughout the year. The freelance income curve is often shaped like a roller coaster's tracks, and it helps to be able to be flexible with it.

I went with an S-corp for several reasons besides the taxes. With an S-corp, all profit and loss pass through to the shareholders (me, in this case), so I don't have to pay corporate taxes on top of any income taxes like I would with a standard C-corp. It also makes accounting a lot easier at the end of the year, gives me some level of protection against prospective lawsuits, and makes it easier for me to do business with huge corporations that prefer to work with companies rather than individual.

Other people prefer forming LLCs or just running their businesses as a sole proprietor. It's really up to you and your situation. It's not really worth setting up an S-corp until you top $30-40k in earnings, but at that point you should sit down with an accountant and an attorney to figure out what works best for you. After all, while I've been at this for a long while, I'm neither of those things, and my situation probably differs from yours. As you may hear many times in your writing career, you should seek professional help. Good luck!

Hot & Steamy Coming this Summer

After taking part in the Writers Symposium at Gen Con last year, organizer Jean Rabe asked me to contribute a story to one of her upcoming anthologies: Hot & Steamy: Tales of Steampunk Romance. She co-edited it with Martin H. Greenberg, an icon in genre anthologies, and I'm pleased to say she bought a story from me for it.

This was a bit of a challenge for me, as I'd never tried my hand at writing a romance before. That may show in the amount of action I packed into this particular love story, but there's plenty of unbridled attraction running through it to pique anyone's interest. It's set in Georgia at the height of the Civil War, and despite all the work I did on Deadlands, I managed to resist putting zombies into it. More's the shame for some of you, I'm sure, but it's meant as a romantic tale, not a horror story, of course.

The book should hit shelves around June 7. I can't wait for you to read it!

Hite on Vegas Knights

At OddCon last weekend, I gave my pal Ken Hite a copy of Vegas Knights. After all, he's thanked in the acknowledgements as one of my regular compadres in my many wild trips to Vegas, and few people outside the city know it as well as he does. He earned a copy of the book in the best way.

Of course, one of Ken's favorite books is the excellent Last Call by Tim Powers, a World Fantasy Award-winning book about magic in Vegas, published back in 1992, long before urban fantasy became a subgenre of its own. Couple that with Ken's well-known status as an erudite and eloquent critic, and I wasn't sure how he would react to my novel. I figured that if he didn't like it, he'd at least keep his mouth shut for the sake of our friendship.

Ken just Tweeted a blurb for the book that I wish I could splash across the cover. In its whole, it reads:

Finished VEGAS KNIGHTS by @mforbeck. Master of pacing and plot; style is humane Spillane: clear as a windshield, punchy as an ogre's fist.

That made my day.

Go Joe! Cobra Wars Out Now

I'd thought that G.I. Joe: Tales from the Cobra Wars was due out next week, but it seems to have slipped out early and is in stores now. Max Brooks (World War Z) and Jeff Conner edited it, and it features novellas from Max,Chuck Dixon, Jon McGoran, Jonathan Maberry, John Skipp & Cody Goodfellow, Duane Swierczynski, Dennis Tafoya, and me.

That's damn fine company to find myself in. I haven't read the rest of the book yet, but I'm itching to, just to see exactly how such a fine group of writers tackled the Joes too.

If you're interested in getting your copy autographed, nearly half the authors will be appearing in Doylestown, PA, for a group signing session on April 23. That includes Jon, Jonathan, Duane, and Dennis. I won't be there, but the rest of the guys will be there to console you until you can track me down someplace else.

Ghosts in Italy

I just found out yesterday that Guild Wars: Ghosts of Ascalon was translated into Italian and released into the wild as I Fantasmi di Ascalon sometime last year. For me, that's particularly cool because my sister Jody spent a dozen or so years in Italy and married a wonderful Italian man who's now the father of their two beautiful sons. I've been to Italy three times myself, and I absolutely love the country and hope to get back someday and explore even more of it.

According to the Ghosts of Ascalon FAQ on the Guild Wars 2 website, other translations are still in the works too. The German edition has been out since last fall, and I have a copy of it on my shelves. The French version is due out from Bibliotheque Interdite (which also publishes translations of my Blood Bowl novels) in June, and a Russian edition is due out from EXMO at some future date.

If you parla Italiano, check out the book's page at the Multiplayer website. It includes a flip-through preview of a good chunk of the book's first chapter to get you started. Read it and let me know what you think.

Fantasy Literature on Vegas Knights

Over at FantasyLiterature.com, Stefan Raets gives Vegas Knights a solid review. While the book went off the rails for him later in the story, he raves about the better part of it, saying such kind things as:

Vegas Knights is a fun, entertaining urban fantasy novel that starts off with a bang and rarely slows down. A large part of the first half of Vegas Knights is one long and excellent action scene that's genuinely exciting and impossible to put down… The pacing is so hectic that it occasionally feels as if this could have been turned into a much longer novel, but on the plus side, this also means there's not a dull moment to be found. (And how rare is it nowadays to find a fantasy novel that could have used more padding?)

One of the biggest challenges of writing a novel is devising an ending that fits well, and I'll admit that's the time I often feel like I'm skittering along the edge of a mountain road, riding on the guard rail on two wheels. That's where the thrills are after all. I don't mind being called on it if it's not working for a reader, as it's often a matter of taste, but I'm glad that Stefan enjoyed the book as much as he did. He wraps up saying:

[I]f you don't take it too seriously, you'll have a blast with this novel. Vegas Knights is far from perfect… but it's hard to imagine a more appropriate book to bring along and read by the pool if you're planning a Vegas trip.

Two Origins Awards Nods

The nominations for the Origins Awards — which honor the best in tabletop gaming every year — were just released. The list shows a strong slate of products, and I'm happy to say I've played/read a number of them. Congratulations to all my friends who picked up nods!

Two projects I chipped in on picked up nominations: Family Games: The 100 Best, edited by Jim Lowder, and Shadowrun: Spells and Chrome, edited by John Helfer. For Family Games: The 100 Best, I wrote an essay extolling the Pokémon CCG, and for Spells and Chrome I wrote a sharp little short story about the weaponization of cursed magic items entitled "No Such Luck."

Of course, they're both in the same category — Best Game-Related Publication — and up against some stiff competition from Hamlet's Hit Points by Robin Laws; No Quarter Magazine edited by Matt Wilson, Aeryn Redel, and Privateer Press; and World at War: Revelation by Mark H. Walker. I'd feel no shame in losing out to any of them. In the meantime, I'll happily add these two to my total for Origins Award nominations, which now stands at, um, 26, I think.

The Book of Extreme Facts

I see that IDW has announced my next book for them: Book of Extreme Facts. This is a tome of wild and amazing trivia that I co-wrote with one of IDW's founders, my old pal Kris Oprisko, and it comes jam-packed with gorgeous illustrations by Brian Miroglio and a snazzy cover by Gabriel Rodriguez, who recently garnered three Eisner nominations for his work with Joe Hill on Locke & Key.

I had an absolute blast doing the research for this book. We live in such a wild and strange world, filled with all sorts of stuff that would be literally too weird for fiction, and it's fun to be able to explore that in a bright and exciting format like this.

I haven't seen the final proofs myself yet, but I cannot wait. The book should hit shelves on June 21, just in time for some summer reading fun.

Vegas Knights Interview and Review

Vegas Knights came out in the US while I was hard at work at Ubisoft Singapore, which meant I didn't have much time to plug it at the time. Fortunately, some excellent people helped out with that while I was out of town.

Over at From the Shadows, E.J. Stevens interviewed me about Vegas Knights, and I stopped by a few times to chip in on some other comments. We wrestled with questions like, "If you could be any paranormal or have any one supernatural talent, what would it be? Why?"

Meanwhile, at Worlds of Ink, Sean "Nix" McConkey — who I had the pleasure of meeting at Geek.Kon last year — reviewed Vegas Knights and gave it 4 out of 5 stars. Among the many kind things he had to say about the book:

Vegas Knights is one of the rare novels that immediately grabs you and rivets you there… While Vegas Knights is a stand-alone novel…, it was an excellent and exciting adventure and left me hoping for more from these characters.

Vegas Knights is on sale now, both as an ebook and in print. Grab it, and it'll grab you.

Ghosts of Ascalon Nominated for a Scribe Award!

Ghosts of Ascalon, the Guild Wars book I wrote with Jeff Grubb, just picked up a nomination for the Scribe Award for Best Speculative Original. The International Media Tie-In Writers (IAMTW) gives out the Scribe Awards at Comic-Con every year to the best in tie-in novels of the past year. In the past, the judges have nominated my Mutant Chronicles and Knights of the Silver Dragon: Prophecy of the Dragons novels, and Mutant Chronicles won the Best Game-Related Adapted novel award in 2009.

This time around, Ghosts of Ascalon is up against some stiff competition in its category from David Mack, Sean Williams, Keith R. A. DeCandido, and Nathan Long. I don't know what the book's chances of winning are, but I'm proud to be in the company of such great authors. It really is an honor just to have the book nominated.

Be sure to check out the IAMTW blog for a full list of the nominations in each category, plus the naming of Peter David as this year's grandmaster. Congratulations to Peter and all the rest of the nominees!