by Guest Contributor Shannan Painter
Accounting for photographers was founded based on the concept that photographers are, by nature, creative, right-brain-dominated individuals. Photographers are incredibly gifted at making portraits into a work of art, but would rather clean the bathroom, get a root canal and sit at the DMV before dealing with the accounting and tax portions of running a business.
As much as we wish this part of our business would just do itself (just like we wish we could wave a magic wand & have the laundry done). It is important to understand this aspect, and have a method for keeping track of income and expenses. There are a lot of choices in accounting software that are available, but most are quite complicated, expensive, and require some basic understanding of accounting. At the end of the year, you – as a business owner – simply need to know how much revenue you generated and what you spent money on that qualifies as a business tax deduction.
One of my first suggestions would be to go out and buy an accordion file with at least 12 dividers. Make a tab for each month, and file away copies of invoices you give to clients along with receipts for anything you spent money on that was business-related. Once a month, you can pull out the receipts and enter them into something like my SNAPSHOT spreadsheet. This spreadsheet is designed specifically for photographers. With this spreadsheet you will have a better understanding of where your money is going in one organized place. I also include tips for tax treatment of business use of home, large purchases and vehicle use.
If you haven’t done so already, it is important to open a bank account dedicated solely to your business. The less your personal & business finances mix, the better!
About the Author: I graduated Magna Cum Laude with an Accounting Degree from the University of Montana. Instead of pursuing a career in public accounting and being stuck behind a desk for 70 hours a week, I turned down jobs at big accounting firms to pursue a different love. I chose instead to work from home where I live with my husband, two boys and a puppy named Growler. I live a glamorous, exciting life working from my living room in my pajamas, cleaning crayon off the walls, driving kids to school, playing superheros and taking care of a little dog that likes to refinish furniture with his teeth. I get to work with fun, creative & artistic photographers and help them understand that numbers can be our friends!