Here’s the latest Entrepreneur On Fire Podcast for your enjoyment!
April 2017 Income At-A-Glance
Gross Income for April: $195,482
Total Expenses for April: $65,237
Total Net Profit for April: $130,245
Difference b/t April & March: -$242,434
Why We Publish An Income Report
This monthly income report is created for you, Fire Nation!
By documenting the struggles we encounter and the successes we celebrate as entrepreneurs every single month, we’re able to provide you with support – and a single resource – where we share what’s working, what’s not, and what’s possible.
There’s a lot of hard work that goes into learning and growing as an entrepreneur, especially when you’re just starting out. The most important part of the equation is that you’re able to pass on what you learn to others through teaching, which is what we aim to do here at EOFire.
CPA On Fire’s Monthly Tax Tip
What’s up Fire Nation, my name is Josh Bauerle. I’m a CPA and the Founder of CPA On Fire, where we specialize in working with entrepreneurs to minimize their tax liability while keeping them in line with the ever-changing tax laws.
I’ve been working with EOFire for years now, and John and Kate have included me in these monthly income reports with unlimited access to all their accounts so I can verify that what they report here is complete and accurate.
And because they believe in delivering an insane amount of value to you, my job doesn’t stop at the verification level; I’ll also be providing tax and accounting tips to you along the way!
Josh’s April Tax Tip: The FAQ’s Continue!
Alright Fire Nation, as you can imagine I am asked a TON of tax questions this time of year.
So for the next few months we are going to do something a little different and I’m going to give you FAQ-style answers to the questions I’ve been asked most frequently this tax season!
Should I Incorporate my Business in Delaware (or another business friendly state)?
This is easily one of the most misunderstood topics I see with business owners – and for good reason.
There’s a lot of terrible information out there from people who want to charge you a lot of money to set up your business in these supposed “tax friendly” states.
I’ll keep this short and simple… You have to incorporate your business in the state you are operating the business from.
For almost all of you, this will be the state you live in. It doesn’t matter if your business only exists online… if you are operating your online business from your home, you are required to register in your state.
Not only will incorporating in a state other than your own save you no taxes, it will also cost you more money as you will be required to incorporate again in the state in which you live.
Just say no to the terrible advice out there telling you to form your business in a state other than your own!
I’m traveling the world, and part of it is for business. What part of the flights can I deduct?
I got this question a lot this year, and it’s a symbol of just how great the current entrepreneurial world is!
People are setting up location independent businesses with business contacts all over the world, they are using their flexibility to travel, and they are writing off some of those travel costs as business expenses.
Pretty awesome right?
But the tricky part is figuring out what parts of that travel are tax deductible (in the case that not all of the travel is for business purposes.)
The big portion of the costs people wonder about are the flights.
The key here is that the flight has to be going directly to the location used for business to be deductible. So what I see happen a lot is that people will fly into one spot for personal reasons, fly to another spot for business, and then return home.
The flight directly to the business location is a clear deduction. But what about the flight to the first location?
You would have needed a flight from the US to get to the business location so it seems logical a portion of the initial flight would be deductible.
Unfortunately, it isn’t.
The ONLY portion of flights you can deduct are ones that go directly to or from the business locations.
The second big expense people wonder about is lodging.
This ones even easier. The lodging expenses at your business locations are deductible. Anywhere else isn’t.
And finally, what if you took your entire family along and not just yourself?
In this case, you can separate costs per person – such as flights and meals, etc – and you would only deduct your costs.
For shared costs, such as lodging, rental cars, and so on, you can deduct the FULL amount because you would need those items with or without your family there.
Deducting travel like this is one of the amazing parts about owning a business, but you have to be very careful to deduct only the costs you are legally allowed.
One final note here: simply working on your computer while traveling does not making your travel business related!
Thanks, Fire Nation, for another amazing tax season. It was a long and busy one, but I wouldn’t have it any other way.
Keep those tax questions coming and lets make 2017 your best year yet!
And as always, please feel free to contact me if you’d like to discuss what would be best for YOUR business. I LOVE chatting with Fire Nation!
*Bonus* If you haven’t checked out Josh’s FREE course on business entities yet, you can get it here!
What Went Down In April
Two years ago we spoke at Tropical Think Tank in the Philippines. This conference was unlike any other we’ve ever been to; Chris Ducker really knows how to throw a party!
At that conference we had the opportunity to meet and spend an entire week with about 50 other entrepreneurs, both speakers and attendees of the conference. One of those attendees was JC Bougle.
About a year after Tropical Think Tank, JC reached out to us and proposed an idea: what if we got together and created a suite of apps that would help entrepreneurs increase conversions on their website to get more leads and customers.
It wasn’t too long after that proposal that we got to work creating just that, and it’s called FireUP.
FireUP allows you to customize 3 apps on your website: the FireBar, the FireBox, and the FireGate, and we’re currently testing all of these apps out on PodcastersParadise.com and EOFire.com.
It’s completely free to get started; offers integrations with email and CRM providers like Infusionsoft, MailChimp and AWeber; and there’s an option to upgrade for enhanced customization and unlimited opt ins.
Head over to FireUP.co to sign up today!
What do you do with your money?
This is a question we’ve been asked a few times over the past couple of months, and today, we’re answering it!
We create these income reports to provide you with a behind-the-scenes look at what it takes to run a successful business: our wins, losses, money in and money out is all out on the table.
What we don’t always talk about is what happens to the net revenue we earn every month.
The short answer…
A lot happens, and if you’ve read the book Profit First, you probably have a pretty good handle on how we manage our money.
The longer answer…
We have a few main categories for the money we earn, and those buckets are (in no particular order):
- Investments and savings
Investments (and savings) include things like our home here in Puerto Rico, our Hyundai Santa Fe we bought in May 2016 (both of which were paid for in cash), and our stocks and portfolios (these make up our savings).
Salaries include the money paid to myself and John as individuals, which is then invested in everyday necessities like food and paying the bills, and also on all the fun stuff, like trips, experiences and other activities.
Taxes has been a big one for us, and the reason you don’t see it on our income report is because once our net revenue is actually considered net, it passes to John as an individual. So EOFire isn’t paying taxes, John Lee Dumas is paying taxes. In 2015 alone, we paid over 1 million dollars in taxes.
Business expenses are everything you see here in our income reports: paying our virtual team, monthly recurring costs for the software and tools we use, payments to our extended team (contractors and retainers), advertising, website development, and so on…
There’s one more bucket, and that’s what we give. In 2016, we donated $75,000 to Pencils Of Promise on behalf of those who invested in themselves and bought The Freedom Journal. We also donated over $1,500 to an organization called Front Row Foundation, which helps individuals and families who are braving critical health challenges.
In 2017, we’ve already donated $10,000 on behalf of those who supported The Mastery Journal campaign, and another $20,000 to various causes that are important to us.
A Full House (and month!)
We literally had a full house (and month!) in April, including speaking at a 25-person mastermind put on by Mark and Krista of American Posture Institute (Puerto Rico Masterminds), and:
A month-long visit from my parents; an overlapping week with John’s mom, sister, niece and friend; and another overlapping week with my aunt & uncle.
Puerto Rico Masterminds was a HUGE hit; Mark and Krista put together an incredible experience not only for their attendees, but also for us as speakers.
From our sunset sail in the San Juan harbor, to John’s first ever talk given in his bathing suit at the pool, to a party bus that was literally hoppin’, this weekend is one we’ll never forget!
Great news: Puerto Rico Masterminds will be a twice per year event put on by Mark and Krista, so if you’re interested in attending a future event be sure to keep your eye on PuertoRicoMasterminds.com!
The mastermind was quickly followed by all the company and all the parties, and we had an absolute blast showing our families around Palmas, sharing our crazy weekly get togethers with them, and experiencing a lot of first-time trips together, including:
- A visit to Hacienda Munoz, a coffee plantation just down the road in San Lorenzo
- A trip to the beach in Naguabo
- A day on Flamenco Beach in Culebra
- A half-way-around-the-island drive to see Ponce
As we come up on our 1 year anniversary here in Puerto Rico, our adventures in both business and life continue. We’re so grateful to have a community of like-minded individuals who live here in Palmas, and our families and friends who come to visit to share it with!
Product/Service Income: $138,509
TOTAL Journal sales: 1,178 Journals for a total of $43,609
The Freedom Journal: Accomplish your #1 goal in 100 days!
- TheFreedomJournal.com: $7,552 (137 Hardcovers & 46 Digital Packs sold!)
- Amazon: $16,056 (472 Freedom Journals sold!)
- Total: $23,608
The Mastery Journal: Master Productivity, Discipline and Focus in 100 days!
- TheMasteryJournal.com: $9,208 (171 Hardcovers & 48 Digital Packs sold!)
- Amazon: $10,793 (304 Mastery Journals sold!)
- Total: $20,001
Podcasters’ Paradise: The #1 Podcasting community in the world!
- Recurring: $19,388 (4 annual, 206 monthly)
- New members: $12,557 (30 new members)
- Total: $31,945
Podcast Sponsorship Income: $57,750
Podcast Websites: $5,000 Your all-in-one podcast website peace of mind
Free Podcast Course: A free 15-day course on Podcasting
Free Webinar Course: A free 10-day course on Webinars
Free Goals Course: A free 8-day course on Setting & Accomplishing Goals
Funnel On Fire: A free 8-day course on Creating a Funnel that Converts!
Affiliate Income: $56,973
*Affiliate links below
Resources for Entrepreneurs: $36,606
- Audible: $128
- BlueHost: $600 (Step-by-step guide and 23 WordPress tutorials)
- Click Funnels: $27,727
- Coaching referrals: $5,649 (email me for an introduction to a mentor for overall online business or a Podcast focused mentor!)
- ConvertKit: $46
- Disclaimer Template: $94 (legal disclaimers for your website)
- Fizzle: $302
- Infusionsoft: $500
- LeadPages: $1,560
Courses for Entrepreneurs: $18,797
- DSG’s Create Awesome Online Courses: $5,383
- Nick Stephenson’s First 10k Readers: $47
- Ray Higdon’s 3 Minute Expert: $128
- Ramit Sethi: $8,780
- Ray Edwards Copywriting Academy: $4,039
- Bryan Harris’ 10k Subscribers: $420
Resources for Podcasters: $560
Other Resources: $1,010
- Amazon Associates: $720
- Other: $290
Total Gross Income in April: $195,482
Business Expenses: $62,972
- Advertising: $3,250
- Affiliate Commissions (Paradise): $1,313
- Accounting: $3,451
- Cost of goods sold: $5,193
- Design & Branding: $2,080
- Education: $41
- Legal & Professional: $1,996
- Meals & Entertainment: $530
- Merchant / bank fees: $4,744
- Amazon fees: $9,793
- Shopify fees: $280
- Stripe fees: $7
- PayPal fees: $645
- Office expenses: $1,436
- Payroll Tax Expenses / Fees: $1,489
- Promotional / events: $0
- Paradise Refunds: $4,145
- WebinarOnFire Refunds: $0 (invoice total)
- Sponsorships: $10,500
- Show notes: $432
- Travel: $1,187
- The Freedom & Mastery Journal: $5,202
- Virtual Assistant Fees: $3,770
- Website Fees: $1,488
Recurring, Subscription-based Expenses: $2,265
- Adobe Creative Cloud: $100
- Boomerang: $80 (team package)
- Brandisty: $24
- Authorize.net: $91
- Cell Phone: $200
- FastSpring: $40 (one-time fee)
- Feedblitz: $15
- Internet: $300
- eVoice: $9.95
- Infusionsoft CRM: $359
- Insurance: $551
- Libsyn: $195
- Chatroll: $49
- PureChat: $20
- ScheduleOnce: $9
- Skype: $2.99
- Shopify: $20
- TaxJar: $19
- Workflowy: $4.99
- MeetEdgar: $49
- WPCurve: $29
- Taxes & Licenses: $77
Total Expenses in April: $65,237
Payroll to John & Kate: $15,900
Total Net Profit for April 2017: $130,245
Biggest Lesson Learned
Follow up, follow up, follow up!
There’s a lot to keep up with when you’re running your own business, and one thing I continue to see entrepreneurs drop the ball on is follow up.
“I reached out to them, but I never heard back.”
This is a common statement (excuse) I hear a lot, and I decided to include this as a lessons learned this month because it’s something I think needs to be talked about and taught more often.
So here’s the lesson:
Remember that every time you send an email, make a phone call, or submit a form on someone else’s site, they’re potentially receiving multiples of those every single day.
Add in the several tasks and responsibilities you’re very familiar with that are required to run your own business (and add a few more for good measure, because if you’re working on building your business, there’s a good chance you’re carrying around some extra to-do’s).
Then think about the fact that we all have personal lives, and that just because you’re anxious about receiving an answer from someone doesn’t necessarily mean that person is on the other end just waiting for your email, call, or form submission.
Finally, remind yourself of how important this connection is to you. You obviously decided it was worth your time to reach out to this person or company in the first place, so why waste that time by not following up?
Relationships, partnerships, deals and ongoing communication requires follow up, and as an entrepreneur you need to step up and take responsibility for making that happen.
Whether it’s reaching out to someone about being a guest on your podcast; you requesting to guest post on someone else’s site; inquiring about a speaking opportunity; or starting a conversation about a partnership, affiliate relationship or sponsorship deal, every time you reach out to someone take responsibility for that communication and don’t forget to follow up!
Alright Fire Nation, that’s a wrap!
Until next month, keep your FIRE burning!
~ Kate & John
Note: we report our income figures as accurately as possible, but in using reports from a combo of Infusionsoft & Xero to track our product and total income / expenses, they suggest the possibility of a 3 – 5% margin of error.
This post was written by Kate Erickson, Content Creator and Implementer at EOFire. Follow Kate on Social:
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