1099 Misc for Royalty Payments

Heads up all you publishers. If you've paid your authors more than $10.00, you need to give them IRS Form 1099 Miscellaneous. The due date is Feb. 1, and here's the fun part: you can't download the form from the IRS website. I just went to the site and found the PDF which stated very clearly it is for INFORMATIONAL PURPOSES ONLY. Great! Looks like I'll be hunting for a form before Friday!

Here is a link to the instruction PDF for Form 1099.

Here's a good explanation about Form 1099 from Wise Geek:

(from article)A 1099-MISC is a type of tax form. It is used to report miscellaneous income, such as income earned as a non-employee, as well as fees, commissions, rents, or royalties paid during the last tax year. Payments for prizes, awards, legal services, and other non-employee activities may be reported on this form as well.

If a business pays you 600 US Dollars (USD) or more as a non-employee, it is legally required to report it to the Internal Revenue Service (IRS), using a 1099-MISC form. For royalty income, a 1099-MISC must be generated for $10 USD or more in royalties. As the payee, you’ll receive your own copy of the form. Once you receive it, you should check it carefully for errors and keep it in a safe place. You’ll need to use it to report this income on your tax return.

(click the link for the full article).

Just another fun thing to do when you're a publisher.

Now will someone please tell me WHY the form cannot be downloaded from the website?

My Muse is Now Tormenting Rick.

A few weeks ago a friend asked me where my Muse was, wondering why she hadn't made an appearance on my blog in a while. I assured her that my Muse wasn't gone, she was just bothering someone else: Rick.

Rick is my life-partner and my in-house book designer. When I said I wanted to start a press and handed him Pete Masterson's book, he said okay (after a few days of questioning glances when I'm sure he thought I was nuts). Since then, he's been my greatest supporter, throwing himself whole-heartedly into book design and general technical management. When I needed a website, he created one. When I needed a logo, he hunted for the best artist and made it happen. And when I needed a book cover design, he hauled out his camera, brushed off his graphic design courses, and made a cover. For Laura's book, he stood out in the middle of the street, taking several photos of the asphalt, braving cars and the occasional bicycle to get that perfect shot.

My Muse loves him.

For the next Medusa's Muse book, What You Need to Know to Be a Pro: The Business Start-Up Guide for Publishers, he is drawing sixteen images, exemplifying each title's subject. I like the idea, but I don't really think we need them. However, he is determined, spending every free moment between his job, his other computer support clients, and being a dad, hand drawing cartoons. There he is at midnight, sitting at the kitchen table, black pen to paper, my Muse right beside him.

"You should leave him alone," I tell her.

She looks up at me and smiles. "Why?"

"Because you're being cruel. He has enough to worry about without you driving him to the point of creative exhaustion."

"He can take it. He's tough." She strokes his arm with one taloned finger. "And don't you like what he's coming up with?"

"Yes, I do. But I don't like the stress."

She rolls her eyes and sighs. "Stress. Every artist needs a little stress, otherwise nothing gets accomplished. What is an artist without a deadline?"

"A happier artist."

"No. A couch-potato. Without the feeling that they MUST accomplish their task NOW, then the task is never completed. You of all people should know that."

Rick looks up at me and says, "I'm just about done with this part. Next I'm going to add color."

"Color?" I walk to the table and stare at him. "I think the designs you have now are great. You don't need to add color."

"I think they'll be stronger with color. And I want to see how the printer handles the images in color."

I bite my lip. "You know, the book has to be done before the first."

"Yeah. I know." He waves me off and gets back to work.

I glare at my Muse.

"What?" she says. "It wasn't my idea."

"Sure." I fold my arms and watch the two of them again; Rick huddled over his drawing and my Muse watching his every move, her snakes leaning closer to catch a scent of him. I sigh, say, "Don't stay up too late, okay?" and then leave the room.

All I know is that when Rick latches on to an artistic vision, there's no pulling him back. He wants to create the best or there's no reason to create anything. We are so alike, he and I. It's no wonder my Muse is enamored of him right now.

Will we make THIS deadline? I honestly have no idea.

More Information On The New Lead Test Law.

Terry Nathan, executive director of the Independent Book Publisher's Association, sent a letter to IBPA members regarding the Lead Test Law. Here is a portion of that letter:

Information about the Consumer Product Safety Inspection Act continues to roll in, and the outcome is anything but clear. One thing that does seem clear is that this Act applies only to books manufactured after February 10, 2009.

I encourage you to 1) contact your printer for input on this issue, and 2) contact your representatives in Washington, DC to voice your concerns. I am including a list of representatives below.

We have been reaching out to our colleagues in various key segments of the industry for information and are continuing to monitor this issue on a daily basis. We will keep you updated..

This is one of the reasons I encourage everyone who starts a small press to join IBPA. Not only do they provide resources and information, they do a lot of advocacy on our behalf.

He also provided links to articles with more information about the Consumer Products Safety Improvement Act (CPSIA), the official name of the Lead Test Law. Here are those articles:

From Bookselling This Week: (excerpt) CPSIA -- which was signed into law on August 14, 2008, in response to last year's recalls of products containing lead -- limits the amount of lead in children's products to 600 parts-per-million (ppm) as of February 10, and 300 ppm as of August 2009. In August 2011, the limit will drop to 100 ppm if it is considered technologically feasible for a given product or product category. The law requires manufacturers of children's products for children up to age 12, including books, to make accessible to retailers a Certificate of Conformity (COC) stating that their products have been tested by an independent third party and comply with lead limits stipulated in CPSIA.

From Publisher's Weekly: (excerpt) The children’s book industry continues to intensify its efforts to push for an exemption from the Consumer Products Safety Improvement Act. The Act, which goes into effect February 10, requires all products for children 12 and under—including books—to be tested for lead, as noted in Publishers Weekly’s recent detailed coverage of the CPSIA and its implications.

The Association of American Publishers is taking the lead in formal lobbying, but other groups are playing an increasing role. The Children’s Book Council, for example, is developing talking points and scripts that publishers can circulate to help employees petition their Senate and House representatives. “There’s been a real flurry of activity in the last couple of weeks,” says Robin Adelson, CBC’s executive director. “People are making phone calls and people are sending e-mails. They’re heeding the call to action.”

And from The Small Publisher's Association: (excerpt) The Consumer Product Safety Act of 2008 (CPSIA) requires items sold for children, manufactured after February 10, be tested and certified for lead levels by an independent lab.

A Consumer Product Safety Commission (CPSC) letter, dated December 23, 2008, affirmed children's books are included in the lead testing requirement.

Products in inventory (in storage and on bookstore shelves) do not need to be tested, but retailers can be fined if the products are found to have excessive levels of lead.

Testing and certification takes place at the book printer level. Publishers need to check with their printer if they have books in the printing process.

Click the above links for the full articles.

If you'd like to take a look at the law itself, click this link for the PDF.

Also, contact your Congressperson and ask them to take another look at the part of the law that affects children's books. Thank you Terry Nathan for this list of people and phone numbers:

1. Sen. Chuck Schumer, NY - -represents most publishers. 202-224-6542.
2. Sen. Diane Feinstein, who has been influential on the issue 202-224-3841.
3. Sen. John Rockefeller, who will soon oversee the committee of jurisdiction, 202-
224-6472.
4. Sen. Daniel Inouye, who will also oversee committee of jurisdiction 202-224-3934.
5. Cong. Henry Waxman, the new chair of the House Committee of jurisdiction 202-225-
3976.
6. Speaker Nancy Pelosi's office, 202-225-0100.

--

President Obama

I don't know what to write. I feel so overwhelmed with happiness, hope and excitement. My cynical, Gen X brain is having a difficult time believing that President Obama is actually PRESIDENT OBAMA.

When I was a baby, Martin Luther King Jr was still leading the fight for Civil Rights. I was a year old when he died. He has been one of my greatest heroes because he stood up for his beliefs and worked to create change in America. His example made a huge impression on me, regardless that I'm a white girl living in California. The fact that my daughter has African-American and Latina friends, that her cousins are half-Filipino and that she thinks judging people by the color of their skin is "silly," shows that Martin Luther King Jr's dream is coming true.

And today, we have absolute proof. He didn't die in vain.

Lead Testing of Children's Books

If you are a publisher of children's books, then you need to be aware of this. A law passed by Congress which was created to crack down on high lead levels in toys has now expanded to include children's books.

From the Publisher's Weekly article:

The Consumer Product Safety Improvement Act, enacted in August 2008 as a response to the high-profile 2007 recalls involving Chinese-made toys containing lead, covers not just playthings but all consumer products intended for use by children 12 and under. That includes books, audiobooks and sidelines, no matter where they are manufactured, even though most books have lead levels that are well below the Act’s most stringent safety standards. The industry is fighting to have most books exempted, but there may not be a resolution by the time the Act kicks in on February 10, so publishers and retailers are proceeding as if books will be included.

This ruling could be an economic disaster for already struggling publishers, as well as impact schools and stores as books are removed from shelves. Of course protecting children from exposure to lead is important, but this law creates more problems than it solves. It is a Congressional reaction, fueled by fear, that doesn't solve the real problem of toxic toys.

From the article:

The CPSIA dictates that each children’s book SKU, shipped to retailers, catalogues and e-commerce sites as of February 10, must have been tested by a third-party lab to ensure that lead levels are below 600 parts per million. (Acceptable levels drop to 300 ppm in August and 100 ppm in 2011.) Some books also must be tested for phthalates, an acid used to soften plastic. The importer or domestic manufacturer must provide a Certificate of Conformity (usually posted on the Internet), and the product must be labeled appropriately. Older products on shelf must fall within acceptable safety standards but do not need to be accompanied by a Certificate, according to recent comments by the Consumer Products Safety Commission.

The Small Publishers Association of North America (SPAN) has created an information page on their website. Click the link to learn more about the law, the labs sanctioned to test books, and what the publishing community is doing to try and change the law so the impact on publishers is not as detrimental.

Even if you don't publish children's books, please write your Congressperson to alert them to the problems inherent in the law. Children MUST be protected, but quickly created laws that are reactionary, rather than comprehensive, just create more, sometimes bigger, problems than the one the law was trying to solve.

Resolutions and Procrastination

This is the time of year when most people in the US make New Year's resolution, making promises to ourselves that will improve our lives, promises like losing weight, eating right, earning more money, spending more time with our families, and accomplishing our creative goals. And usually we all start off full of energy and commitment and then by February fall off the resolution wagon. By March, we're beating ourselves up for not sticking to our resolutions and then by Summer we hate ourselves for not being able to comfortably wear a bathing suit.

I decided to skip resolutions this year and instead have only promised to be kind to myself. That's all. Just be kinder.

Which means I am not allowed to berate myself for not keeping up this blog as diligently as I should. Or for the fact the Business Book is still way behind schedule and it looks like it will be mid-February before we can launch it. Nor am I allowed to feel guilty that I STILL haven't gotten back to my Punk Rock contributors with their notes. Nope, not allowed to beat myself up for procrastination.

We've been taught that procrastination is a bad thing, but I'm starting to doubt that assumption. Of course, anything is bad if it stops you from achieving your dreams. Procrastination in the extreme is just as harmful as being in a bad relationship. But some procrastination is healthy. Not everything has to be done RIGHT NOW. In fact, trying to get everything done immediately, on time, and perfectly creates more stress than any task should. I think if we look at the tasks we keep putting off we can discover where our resistances are hidden.

Resistance: an opposing or retarding force (from the Merriam-Webster Dictionary). That's really what procrastination is. We procrastinate because we either don't really want something, don't feel we deserve it, or can't figure out how to get it.

I get overwhelmed very quickly because I take on too many tasks all at once and then I suddenly run out of steam. Instead of writing my blog, I start wandering around Facebook. I chat with friends about whether or not I should let my bangs grow out or not, and then get mad at myself when I run out of time to edit a Punk essay. When I start to procrastinate, I know I'm doing too much. My brain needs the break from constant activity, so I take a walk in the sun or play the Sims.

Rather than allowing those moments of procrastination induced inactivity to take over my life, I've started setting a time limit. If I'm that stressed out or brain-dead, I can have a cup of tea and watch an old movie. But as soon as the movie is over, I have to get back to work on a specific task. I make a list of all the things I need to accomplish, then organize them by Urgency (see earlier post on organizing). I start with the most urgent task, then take breaks when needed by doing one of the more physical tasks, like sweeping the floor or pulling weeds. After a while, I return to the urgent task, refreshed and ready to finish.

Procrastination is not the enemy, your resistances are. So please don't beat yourself up for not exercising or finishing your novel. Be kind to yourself. Tell yourself you DO deserve to be a writer, you DO deserve to eat well. If you're zoning out on MySpace all day, ask yourself "Why?" Are you lonely, tired, bored, or stressed? If you feel like you really need to surf MySpace, then set a timer. Give yourself one hour to surf the net, and then force yourself to do something else. Denying yourself a MySpace account completely is just setting yourself up for guilt and failure; eventually you'll fall off the wagon and spend three days checking out new bands.

And you can always bribe yourself. Chocolate works for me. If I write for two hours I can eat a piece of chocolate. Small bribes that provide immediate gratification can do wonders in motivating you away from Zappos. Remember how much a piece of candy can compel a child to clean their room?

Thank you Ron Asheton for your Amazing Music

Yesterday I learned that Ron Asheton, founding member of The Stooges, which in my humble opinion is one of the greatest Punk bands of all time, died at his home in Anne Arbor. He was 60.

From the AP article:

DETROIT (AP) — Ron Asheton, the guitarist for the Stooges whose raw sound helped inspire the first generation of punk musicians, has died. He was 60.

Asheton was found at his Ann Arbor home early Tuesday morning by police officers after they were called by an associate who had not heard from him in several days, said city police Sgt. Brad Hill.

There were no signs of foul play, and the death appeared to be of natural causes, Hill said.

Asheton was a founding member of the Stooges, the influential protopunk band formed in Ann Arbor in 1967, along with his brother, Scott.

Lead singer Iggy Pop called Asheton "my best friend" in a statement Tuesday, and the band expressed shock at his death.

"For all that knew him behind the facade of Mr. Cool & Quirky, he was a kind-hearted, genuine, warm person who always believed that people meant well even if they did not," the band said in a written statement. "As a musician Ron was The Guitar God, idol to follow and inspire others. That is how he will be remembered by people who had a great pleasure to work with him, learn from him and share good and bad times with him."

Asheton's powerful, distorted guitar on songs like "I Wanna Be Your Dog" and "T.V. Eye" was a hallmark of the group's sound. His "technically adept but also beautifully raw" style was heavily influenced by free jazz and created "beauty out of noise," said Brian Cogan, a punk-music historian at Molloy College on New York's Long Island.

Follow the above link to read the rest of the article.

Tonight, I will raise a toast to Ron Asheton while listening to TV Eye.

Profit and Loss Statements can be so... um... interesting?

(image from www.myownbusiness.org)

My daughter went back to school this morning and I did a little happy dance thinking about all the free time I now have to be creative and write and maybe sew the curtains and definitely plunge head first into the Punk Anthology and... do the books! Not make a book. DO THE BOOKS. 2008 can not be put to bed without first being tucked in with an official Profit and Loss Statement.

And what is a Profit and Loss Statement? In a nutshell, a profit and loss statement is the end of the year report of your business that shows how much you've earned (profit) and how much you spent (lost). This is what you need to show the IRS when you file your taxes, as well as show your city for you business license, your bank when you need a loan, or anyone else who needs proof that you really do have a business and didn't just put up a pretty sign that says so.

Organizing your profit and loss statement can be daunting, which is why I keep stressing that you should keep track of your earnings and receipts all year long and not just at the end of the year. If you do a mini Profit and Loss statement for every quarter, the time you spend going through receipts and finding old invoices will be cut in half.

I wish I could say I did that (can't take my own advice, now can I?). Quarter one and two were perfectly managed and organized, but quarter three and four were not. As soon as I started school, my records from July to December 2008 were tossed in a file called "receipts" and ignored. Luckily I didn't spend much during that time so there weren't many receipts to tally (nor did I earn very much, so the invoices were low. Not sure that's good, though).

After two hours of organizing receipts and tallying up my costs and earnings, I had my statements for both Quarter 3 and 4. Then I could tackle the entire year.

My expenses are broken into several categories:

-printing
-promotion
-shipping
-supplies
-licenses
-royalty payments
-training
-consultants
-miscellaneous (always have a misc section)

... just to name a few.

The IRS needs all these categories to provide you with the right deductions, plus it will help you organize your receipts better if you can link it to a specific area of your business. And breaking down expenses into different categories enables you to clearly see exactly where your money is going (I spent $22.00 on pens?)

There are numerous templates and tutorials on line to help you with your Profit and Loss statement, but I just created my own by using an Excel spreadsheet. Keep it simple, thorough and clear, and make sure you can back up your expenses with receipts. You can SAY you paid $1000 on printing, but if you get audited and don't have a receipt, you'll be in big trouble with the IRS.

I'm now waiting for one more form from my Wholesaler to verify how many books we sold in December before I can put 2008 to bed. Overall, Medusa's Muse lost money. A lot of money. Far more money than I should have spent. But I really wanted to go to LA and see BookExpo, so I went over budget. Oh well, sometimes the experience is worth the interest on the credit card. But 2009 is going to have to be a much leaner year to make up for this one. I have a feeling a lot of people will be doing the same thing.

The MacBook Air has arrived!

Right now, I am updating this blog using my brand new MacBook Air, a Christmas gift from my hubby. It arrived yesterday. What's a Macbook Air you ask? Click the link to see how ultra thin, ultra fast, and ultra sexy it is.

I swear, it is so light sitting here on my lap if I fart I might blow it right off and onto the floor. It is lighter than the book "Goodnight Moon." It's like typing on a couple of loaded down paper plates. But the screen is large, the resolution excellent, and the keyboard the right size for typing. Plus, this baby zips! I can zoom around the internet like I'm wearing a jet pack. I click a link and SHAZAM, I'm there!

This is a big improvement over my old laptop, an orange clam shell bought in 1998. Over ten years it has served me well, providing me the tools I needed to write two novels, several plays, and start a publishing company. But in the last two years I've felt the clunk of old software. Surfing the net became a chore, a real problem since Medusa's Muse is primarily an internet based business. Eventually, my orange clam shell became a typewriter and I used the PC in the living room for my work.

Although the clam shell is now replaced by a new, fresh, and superior tool, I am attached to that old orange oddity. Rick wanted to donate it or strip it down for parts but I said I wasn't ready. It's like sending an old horse out to pasture. You know it's time, but you're going to miss the old gal.

I'm excited to get back to work with my new tool. The first book I'll be editing on this lap book is the Punk Rock Anthology, Punk Rock Saved My Ass, debuting this summer.

After many weeks of holiday festivities and family time, I'm ready to get to work.