Tag Archives: money

Accounting for Photogs Recap

24 May

Accounting isn’t the sexiest part of running your own photography business; aside from equipment malfunction and extreme weather patterns, it’s more like the scariest. But last Thursday at our Quarterly Meeting, it was actually cool. Heather O’Mara helped plan the event, held at CPC Financial in King of Prussia, and hosted by Richard C. Capasso, CPA, PFS, CFP.

Rich isn’t your stereotypical accountant. He’s got a great sense of humor, is excited to advise on financial planning, and is really easy to talk to; it’s obvious after a few minutes just how passionate he is about helping small business owners (their firm has over 800 clients – all small businesses.)

It was an information-packed evening – two hours of advice that would be overwhelmingly long in a blog post, so instead, here’s a few highlights:

Money Matters:

1. No matter what type of business entity (Sole Proprietor, LLC/LLP, Corporation or “S” Corporation), set up separate bank accounts and credit cards so that everything is clearly defined as personal or business, leaving no gray area or confusion come tax time (and hopefully not: audit time).

2. At the very least, keep a checkbook, and have an income statement that shows profit/loss.

3. Remember that you need to earn roughly $1.40 to take home $1 after taxes, so pay what expenses you can before paying yourself. If you pay for something business-related on your own dime, treat it just as if you worked for another company and create an expense report before reimbursing yourself.

4. If you pay any one person more than $600 aggregate in one calendar year, you must send them a 1099. If not, and you are caught, you’ll lose the deduction on your return and be subject to a fine of $1,000-$10,000.

5. There’s no benefit to keeping extra funds in your business account. When there’s excess, distribute funds to your personal account to avoid any gray areas. And be sure to set aside 30% of that amount for income tax.

Deductions:*

6. If you claim a home office on your taxes, it must be a space reserved only for business, not an office/playroom, office/dining room, office/bedroom, etc. And if you’re claiming a studio, you’ll need a separate entrance into the space from the outside. Once you figure out what percentage of the home your office occupies, you can also calculate that percentage of your utilities, mortgage and possibly even your landscaping.

7. Health insurance premiums can be deducted from your tax return, as well as portions of your internet and cell phone bills (not included in the home office deduction).

8. When traveling, log your mileage – which is currently 50.5¢/mile and includes depreciation on your vehicle, insurance, and gas. (Second shooters and assistants who are traveling separately can also claim their mileage.) Only claim your vehicle if more than 50% of the mileage is used for business purposes total.

9. Charitable donations are NOT deductible – only the cost of goods (your vendor’s, not your mark up) for items gift (for example a canvas print, album, etc).

10. Don’t get wrapped-up in the idea of deductibility, or make purchases simply because they are a tax deduction. Everything should make good business and investment sense.

* Remember that if your company has a loss for the year, you can’t claim many expenses, including a home office or new equipment. You may, however, be able to extend and still claim some deductions the following year – check with your tax preparer or accountant to find out more.

If you’re interested in speaking with Rich about financial planning for your own business, or to get a business started, contact him by email at rich@cpcfinancial.com or call 610-265-4122.

Want to help out, organize, host or assist with an event? Give us a shout at info@phillyphotobetties.com.

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Tech Tuesday: Dough-togs for Photogs

29 Mar

If you’re a fan of programs like Living Social and Groupon, you’re gonna LOVE this one. How about a program that offers photog-focused deals on things like discount memberships to Borrow Lenses or $65 to spend on a gallery wrap? Well, look no further. There’s a program. Just. For. Us. I give you…. Photo Dough.

How it works:

  • Subscribe to Photo Dough by hitting up the website and submitting your   email – and follow them on Facebook and Twitter for realtime deal updates
  • Share the deals with your friends and get better offers in the future
  • Save on stuff you really need for your business/studio

We can all relate to the increasing costs of running a business, and specifically the high costs associated with our industry. Now there’s a way to keep a little more cash in our pockets when we decide to spring for a new studio sample, a cool new piece of gear or when we’re ready to try a new vendor or product.

Oh, and today’s deal? $50 off Totally Rad Actions (TRA) legendary action set The Revenge. Not too shabby.