Latest EOFire Podcast EOFire’s October 2016 Income Report

Here’s the latest Entrepreneur On Fire Podcast for your enjoyment!

October 2016 Income At-A-Glance

Gross Income for October: $157,404.50

Total Expenses for October: $61,245

Total Net Profit for October: $96,159.50

Difference b/t October & September: -$7,201.50

eofire income report button

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.

Let’s IGNITE!

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 October Tax Tip: Deducting entertainment events as a business expense

As a CPA, I absolutely love sports.

Let me explain… My love of sports statistics is what originally drove me to becoming a CPA, as I saw taxes and accounting as a form of statistics for businesses.

But do you know what I love most about sports?

The ability to attend amazing sporting events and deduct the cost in my business!

In fact, I used this strategy just last week to watch my Cleveland Indians defeat the Chicago Cubs in game one of the World Series!

How to deduct entertainment events as a business expense

Can this really be possible?

Are you really able to attend a pure entertainment event like a sporting event, that in and of itself doesn’t directly benefit your business, and deduct it as a business expense?

The answer is yes!

But you have to know what you are doing.

Here’s a quick primer on deducting sporting events, or any entertainment event (concerts, movies, rounds of golf, etc.) as a business expense.

  • Make sure a portion of your time together is conducive to discussing business

Unfortunately, a baseball game itself probably isn’t the best venue to discuss serious business. There’s a huge crowd making a lot of noise and an amazing Cleveland Indians baseball team taking your attention away from any serious discussion!

So how can we still claim it was used for business?

By combing the event with something that is conducive to discussing business.

So instead of just showing up for the game and leaving, maybe you set up a long dinner before the game and go for drinks for further discussion after the game.

By sandwiching the sporting itself between two things that are regularly used for business discussion makes the entire day’s events deductible.

  • Make sure substantial business is discussed

One of the biggest stipulations with this deduction is substantial, meaningful business must be discussed. Simply taking a spouse or friend and mentioning your business a few times won’t cut it.

If you are going to take the deduction, do it right.

Take someone you can have a true, meaningful business discussion with, like your CPA, attorney or business partner.

Then actually have that true, meaningful discussion. Have something specific that came from that event to help your business just in case the IRS ever asks.

  • You can only deduct 50% of the cost

Unfortunately there are limits here on the amount you can deduct and it comes down to 50% of the amount you paid for all the events. And that 50% holds true whether you pay for just yours, you and your guests, or you and several guests.

The good news is you can lump all of the costs for the day into that 50%, from the meals, drinks, ticket costs concessions, etc. So despite the 50% limitation, you can still end up with a pretty substantial tax savings.

Deducting your entertainment events like sports tickets is like any other great tax strategy: it should be treated with care, used legitimately and documented appropriately.

It would be a great idea to spend a few minutes after the event documenting who you went with, what exactly you did, and what substantial business was discussed as a part of it.

If you can do that, you can turn some awesome entertainment events into legit business tax deductions.

If you have a question you would like to see covered in a future income report, leave it in the comments section below, or reach out to me directly!

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 our FREE course on business entities yet, you can get it here!

Kahuna’s Accounting Tip

Frank Lunn is Founder/CEO of Kahuna Accounting, a company who helps entrepreneurs (including us!) create a simple and scalable accounting financial success system with a virtual accounting team to help you stay on track!

CEO Frank Lunn’s October Accounting Tip: Financial Success Servomechanism

John may not know this, but he and I have something in common: we were both Army officers and trained as tank commanders.

Despite our training being more than a decade apart, we both had similar experience with a very interesting piece of multi-million dollar hardware: the M1 Abrams Battle Tank.

One of the key components and secrets of the success of this tank is something called a servomechanism.

Basically, a servomechanism is an automatic control device controlling a lot of power with a little power while constantly correcting for performance. One of the most extraordinary things I experienced during my tank training was how the barrel of the tank could remain “locked on target” despite the movements of the tank – even while moving over terrain.

Imagine having your finger pointed at an object, then turning your body or walking in different directions, but yet your finger remains pointed at your objective.

Ok, so what does this have to do with entrepreneurship?

I’m glad you asked…

I love this as example and metaphor because we as entrepreneurs also need to know our target (what we want) and then lock on that so we don’t lose sight (take action).

Of course, we also need a financial success servomechanism (a bookkeeping and accounting success system) we can use in our business to stay locked on target while making easy corrections as needed to achieve the financial success we desire.

How to employ a financial success system

So with hundreds of factors that might distract us or push us askew from our desired objective, how do we employ a financial success system to self-correct as needed?

The most basic, yet often overlooked takeaway for entrepreneurs is to actually have a financial target.

Start with a goal.

Think specifically about what you want to achieve, and then start writing out the steps you need to take in order to make it happen.

Once your target is selected, stay locked on it. Use feedback from your financials to better understand and make course corrections as needed.

Entrepreneurs are sometimes intimidated by financials, but you shouldn’t be.

Accounting isn’t about math; it is about keeping score and telling a story.

Financials provide a numeric way of telling your story, so rather than be intimidated by it, ask others you trust and seek to learn more. Understanding your story through financials provides better feedback to lead and can help you focus on your target to improve your financial story.

We’re honored Kahuna Accounting is be part of EOF’s Financial Success Team. Our core mandate is, “We achieve our victories through the victories of those we serve!” We love serving entrepreneurial Victory Achievers as they achieve their victories!

What Went Down In October

America’s Finest City: San Diego

While the month of September was spent on the East Coast enjoying a crisp, Maine Fall, a majority of October was spent in sunny San Diego visiting family, friends and conference hopping!

San Diego Sail Bay

For John, San Diego was short-lived.

He jetted to America’s Finest City to speak at a meet up put on by Rick Mulready, and then to present at Amy Porterfield’s one-day meet up for her B-School peeps.

Amy bought a Freedom Journal for EVERY one in attendance, being the amazing friend she is!

It’s always a blast hanging with Rick and Amy, and it made John a little nostalgic for the amazing Entrepreneurs that populate SD, putting even more meaning and emphasis on the Jim Rohn quote:

‘You are the average of the five people you spend the most time with.’

For me – well, I learned what it really means to work and travel at the same time!

While in San Diego I was lucky enough to do A LOT of stuff, including:

Attending the annual Hot Air Balloon Fiesta in Albuquerque, NM with my family:

Balloon Fiesta

Go camping in Joshua Tree National Park with a group of friends for my sister’s birthday:

Joshua Tree

And spend an amazing amount of time with my parents, my sister’s family, and friends:

family

As you can imagine, the trips within trips and fun family outings made it tough to get in much focused work time.

I’ve learned several things over the past couple of months about working and traveling at the same time, like:

  • Boundaries are required
  • Discipline and focus are SO important
  • Systems, a foundation and having a team are what make it work
  • Planning ahead can make all the difference

This will be our lesson learned for the month, so stick around till the end of the post to hear more details on how to effectively manage work while you’re traveling!

Filming for The Mastery Journal

In late October, we welcomed two amazing entrepreneurs to Isla del Encanto (Puerto Rico) to film the Kickstarter video for The Mastery Journal: Brandon T. Adams (our Kickstarter pro) and Chris Lo (our videographer for this project).

After chatting about my goals for the film, listening to expert advice from Brandon and Chris, and writing out a script for the A-roll, we were off to the races!

We filmed on location at the EOFire Studios, at the beach down the street from where we live, on the trail where I go for my morning runs, and in various other places around beautiful Palmas Del Mar.

Here’s a super sneak peek at The Mastery Journal video:

The Mastery Journal video trailer sneak peek

As you probably know by now, The Mastery Journal: Master productivity, discipline and focus in 100 Days, is my BIG focus right now.

With our launch coming up quickly in Q1 2017, we’re head-down with editing, proofing, improving, printing, filming, and everything else that creating a journal requires. (To get a good idea of exactly what it requires, you can check out our step-by-step process for creating and launching The Freedom Journal on Kickstarter!)

We’ll be sharing our progress, as well as providing gifts and awesomeness along the way, so be sure to sign up for updates and a behind-the-scenes look at TheMasteryJournal.com!

The Mastery Journal

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

October 2016 Income Breakdown*

Product/Service Income: $113,729

The Freedom Journal: Accomplish your #1 goal in 100 days!

  • Shopify: $14,434 (310 Freedom Journals & 26 Digital Packs sold!)
  • Amazon: $8,821 (228 Freedom Journals sold!)
  • Total: $23,255

Podcasters’ Paradise: The #1 Podcasting community in the world!

  • Recurring: $12,645 (159 monthly)
  • New members: $9,150 (36 new members)
  • Total: $21,795

Podcast Sponsorship Income$61,500

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

WebinarOnFire: $1,991 Learn how to Create & Present Webinars that Convert!

The Fire Path Course: $54 A step-by-step business roadmap

Podcast LaunchAudiobook$96 | eBook: $38

Affiliate Income: $43,675.50

*Affiliate links below

Resources for Entrepreneurs: $15,167

Courses for Entrepreneurs: $25,355

Resources for Podcasters: $1,212.50

Other Resources: $

  • Amazon Associates: $1,167
  • Other: $774

Total Gross Income in October: $157,404.50

Business Expenses: $58,114

  • Advertising: $2,647
  • Affiliate Commissions (Paradise): $2,798
  • Accounting: $350
  • Cost of goods sold: $4,140
  • Design & Branding: $1,980
  • Education: $131
  • Legal & Professional: $717
  • Meals & Entertainment: $1,398
  • Merchant / bank fees: $1,759
  • Amazon fees: $3,948
  • Shopify fees: $2,314
  • Stripe fees: $35
  • PayPal fees: $589
  • Office expenses: $1,339
  • Promotional / events: $288
  • Paradise Refunds: $7,118
  • WebinarOnFire Refunds: $0 (invoice total)
  • Shipwire: $2,000
  • Sponsorships: $12,875
  • Show notes: $324
  • Total Launch Package Fees: $0
  • Travel: $2,819
  • The Mastery Journal: $2,750
  • Virtual Assistant Fees: $3,782
  • Website Fees: $2,013

Recurring, Subscription-based Expenses: $3,131

  • Adobe Creative Cloud: $100
  • Avangate: $34
  • Boomerang: $80 (team package)
  • Brandisty: $24
  • Authorize.net: $91.10
  • Cell Phone: $192
  • CCBill: $20
  • Google Storage: $9.99
  • Go2MyPC: $12
  • Graphly: $99
  • Internet: $332
  • eVoice: $9.95
  • FocusAtWill: $45 (annual fee)
  • Infusionsoft CRM: $360
  • Insurance: $551
  • Last Pass: $12 (annual fee)
  • Libsyn: $323
  • Chatroll: $150
  • PureChat: $20
  • ScheduleOnce: $9
  • Skype: $2.99
  • Shopify: $20
  • TaxJar: $19
  • Payroll fee: $216 (switched to ADP)
  • Vimeo Pro: $199 (annual fee)
  • Workflowy: $4.99
  • MeetEdgar: $49
  • Wistia: $25
  • WPCurve: $29
  • Zapier: $15
  • Taxes & Licenses: $77

Total Expenses in October: $61,245

Payroll to John, Kate & PR Team: $24,930

In our May 2014 Income Report and our June 2016 Income Report, Josh focuses on how to pay yourself as an entrepreneur. Check them out!

Total Net Profit for October 2016: $96,159.50

Biggest Lesson Learned

Work + Travel = Discipline (+ a whole lot more)

I’ve learned several things over the past couple of months about working and traveling at the same time, like:

  • Boundaries are required
  • Discipline and focus are SO important
  • Systems, a foundation and having a team are what make it work
  • Planning ahead can make all the difference

On September 5, 2016 John and I flew to Portland, ME to visit and stay with his family for a month.

There was a lot of work and prep to be done leading up to this trip because we knew, for example, things like recording podcast episodes or bringing on new sponsors wouldn’t be possible while we were on the road.

We also knew a good portion of our time would be spent relaxing, being out and about with family and friends, and we had Agents of Change on the calendar for the 23rd of the month.

Given everything we knew about our trip – and taking the time to acknowledge these things – allowed us to prepare.

So before our plane ever touched down in Portland, ME, John’s family knew we would be spending a certain portion of every day focused on our work.

In order to help us practice discipline and continue to focus while we were working on the business, the first thing we did when we arrived and started to settle in is set up our office space.

Luckily, there were good chunks of the day – every day – where we were able to completely shut off. This was in part due to the systems we’ve put in place, the foundation we’ve built, and the virtual team we’re so lucky to have.

But without some good old preparation and planning, this trip wouldn’t have been possible. Email campaigns, blog posts, sponsorship reads, interviews and show notes are just some of the tasks we were able to handle before we even left Puerto Rico to help take some of the pressure off while we were traveling.

But even when you prepare and plan and get as far ahead as you can, there are still going to be things that come up – mini emergencies or just every day tasks you need to be responsible for.

On September 26th, I flew straight from Portland, ME to San Diego, CA to continue my Stateside visit, and upon arrival in San Diego, I realized I hadn’t done such a great job of setting boundaries.

Furthermore, my discipline and focus weren’t 100% most of the time because I never took the time to set up a work space for myself – this made a HUGE difference.

While I was managing to keep up with the business, I wasn’t making much progress, and when it came to those mini emergencies I was really thrown for a loop.

In the end, thanks to planning ahead, along with the systems, foundation and team we have in place, I managed to balance my travel and work simultaneously.

But next time, I hope to exceed even my own expectations when traveling for longer periods of time.

Alright Fire Nation, that’s a wrap!EntrepreneurOnFire

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. 

Click here for all of EOFire’s Income Reports

This post was written by Kate Erickson, Content Creator and Implementer at EOFire. Follow Kate on Social:

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The post EOFire’s October 2016 Income Report appeared first on EOFire Business Podcasts.

       

 

 

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