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“Beware the Jabberwock, my son!

The jaws that bite, the claws that catch!”- Lewis Carroll

In the end, I lost two working days, $25, and risked some bad feedback from an upset buyer. It started well enough…

The job posting was to ghost a hundred page e-book. More details came after an inquiry: The buyer already had most of the book done; he just wanted a rewrite. He said he was a writer himself and proudly pointed to a web page he’d written. His only problem was not having enough time to ‘tweak’ his e-book. Fair enough. I’m in.
An easy job starts to go downhill.
He touted it as an ‘easy job’ (don’t they always say that?) and sent me his first draft. There was a lot of material, and it wasn’t badly written, so I sent a letter of understanding to finalize the project and got to work. So far, as common as plastic ware.

Ah, but then I sent him my proposed table of contents and part of a chapter to get some feedback. “Oh,” he writes, “I sent you the wrong draft.”

“That part was already done by the first writer.”

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I’m big on referring other writers to oDesk. I like the setup here and I like the built in protections. But I find that many otherwise enthusiastic writers new to freelancing feel intimidated. They have a bit of trepidation about selling their ‘product’.Bound up in this anxiety is a fear that their writing isn’t good enough. They want to know if they have what it takes. They want training wheels and some way to find out if commercial writing will work for them. They need a confidence builder and an ego booster.
Trying on the writer’s hat.
Where can you go to try before you commit? Try content sites.

Sites where writers can post articles, have them rated, and sometimes earn a couple of dollars. The earning dollars part isn’t really where the value is. These sites are best used to get some practice writing articles for the net and some feedback.

The one I am most familiar with is Helium.com. I have to stress that it isn’t a good place to make steady money. It isn’t a brokered job site like oDesk and it is unlikely that you will build long-term relationships with any buyers.

That being said, it is a good place to write and submit articles in competition with other writers. Article titles are provided and multiple writers all write using the same title. Articles are rated against each other in a better/worse model. The nice thing here is a distinct lack of consequences if a particular article doesn’t do well. Here are some specifics about the site:

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Business or Hobby?
Before we talk tax deductions, there’s a key definition you need to keep in mind. To take most of the deductions I’ll mention, you have to be categorized as a business by the IRS. The notion of a ‘business’ overlaps with ‘contractor’ and from a practical point of view there isn’t much to distinguish a sole proprietorship (business) from a contractor. Both categories pay self-employment taxes and may have to file quarterly estimated tax payments. For freelancers, the deductions are so similar that it doesn’t matter what you call yourself.

So, are you a business? Here’s what the IRS says are the defining characteristics–

“A trade or business is generally an activity carried on for a livelihood or in good faith to make a profit.” No matter how much or how little you write, to qualify as a business, you have to have a profit motive. You prove this by getting paid, or by trying to make money even if you don’t actually make a dime.
The IRS also says, “You do not need to actually make a profit to be in a trade or business as long as you have a profit motive.” Quit writing for free and quit writing solely for contests or just to get your byline posted somewhere.
And the IRS tells us what they are going to look for: “You do need, however, to make ongoing efforts to further the interests of your business.” What does that mean? Well, it means I bid for jobs. And whether or not I get any particular job, the notice that oDesk emails to me gets saved. That’s my proof. Pretty sweet huh? You get turned down for a job and it works in your favor anyhow. Just print out a screenshot of all the email titles from oDesk (which show the dates- hence ‘ongoing’) and file it under ’seeking work’.
One last nugget from our government friends: “You do not have to carry on regular full-time business activities to be self-employed. Having a part-time business in addition to your regular job or business also may be self employment.” You do have to keep your part-time business separate as far as income and deductions go, but that’s not hard. Just keep different records for the business stuff- receipts and bank statements showing income. By the way, you do have a separate bank account for funds transferred from oDesk, right? Right?

The more business-like you appear, the less likely you will have problems taking deductions against your business income. Get a DBA (doing business as). In Michigan, where I live, it’s a simple matter of paying $15 to the County Treasurer’s Office. I gave them a name for my business and they gave me two certified certificates showing I was registered.

Even though I am a sole proprietor and freelancer, having a business alias is a boon. It allowed me to open a bank account under the business name, get a credit card and bank statements under that name (for record keeping), and makes it makes the IRS happy.
Let’s deduct.

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It’s April, and while young men’s hearts are turning to love, freelancers turn to thoughts of taxes. Yes, taxes. I know, I know… griping about taxes is only slightly less common than moaning about traffic or the weather. In my opinion, all the complaining is unjustified.

Taxes are more than a payment made to run the government (admittedly rife with flaws) they’re a demonstration of success in your chosen profession. And paying your fair share of taxes is the only patriotic act available to most of us. Fly a flag if you like, but if you really want to support your country, pay up. As much as we might not like the government overall, it’s our government, the one most of us voted for and the one we have to live with. So, quit shirking your responsibility and join the rest of us who have been supporting your lazy butt.

Sorry, I was talking to my son for a minute there.

Please note, earlier I said, ‘fair share’. I am not advocating the IRS as a charity– whose motto would be “Give till it hurts.” Find and take all the deductions you are allowed. Just don’t play fast and loose with iffy credits you read in some blog. (More on deductions later.)

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I have a friend.

I’m sure you have friends too, it’s part of the human condition; but that’s not what  this post is about.   Instead it’s about what you need to think about when you work at home from the computer.

So let’s take my friend, who we’ll call Tom Smith …

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oDesk is different from all the other freelance sites I’ve worked with, and I think many of the differences are good things. The first one, which we’ve mentioned more than once, is the hourly model. It’s a great way for people to transition to freelance if they’re not used to estimating how long tasks are going to take. The other big difference is the oDesk client.

I’ve joined several other sites and none of them have required that I download a client the way oDesk does. On the flip side they haven’t guaranteed an hourly wage either. This is oDesk’s biggest strength, and the client is a very small price to pay for that guarantee.

If you’re new to oDesk, or maybe you just heard about it online and want to know if it’s a worthwhile place to look for work you may not know much about the client. Essentially it’s an automated billing system and verification tool.
What it does:
1) Take Regular Screen Shots

2) Record the number of keystrokes/mouse clicks in a given period.

3) Provide proof to the buyer you were working for those hours that your pay is guaranteed.
What it doesn’t do:
1) Scan your hard drive

2) Take images of what isn’t on the monitor in focus

3) Track everything you type while it’s running and upload it to a hidden server.
This is how it works:

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If you are a solo freelancer like me, you might not realize how employee morale impacts your business. Employee, you ask? Sure- you. In this article, I’m going to try to convince you that paying attention to your own personal growth by seeking out off-line activities will improve your skills, your income, and your attitude.

As freelancers, we have the opportunity to make our businesses both enjoyable and lucrative. One or the other alone isn’t really satisfactory. If you just enjoy yourself without making any money, it’s a hobby. If you just go for the dollar and hate it, it’s a job. When you are able to combine them, you have the makings of a career and a lifestyle worth having.
A psychic burden.
Let’s not kid ourselves. Writing for others can be a grind. When a deadline looms like a storm front, all crackly with lightning and ominous intensity, we are liable to just quit and seek shelter. Doing that fails the client and fails us. A commitment for five articles on the proper storage of construction materials can suddenly seem like an insurmountable mountain of pure drudgery; and the title we struggled to earn, ‘freelance writer’ seems like a synonym for ‘wage slave’. How are we to escape this muck and get our enthusiasm and energy back?

Well, I hear drinking heavily is useful, but that costs money (and eventually much more). What works better is simply paying attention to your own needs and creating an off-line life. Not only will this rejuvenate you, but it will tend to make you a more interesting person. Both of these traits will appear in your writing.
Solutions
Here are some off-line, writing related (read that as tax-deductible) activities to try:

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First off, I’d like to thank Josh Breinlinger for commenting on the first part of this series with handy information as well as boosting my cool status by a full ten points! I hope you continue reading and commenting.

Now, on to business. What are some good ways to protect yourself when doing fixed-price jobs? How does it apply to oDesk, GAF, and Elance? Why does Nelson hate GAF and Elance after a couple hours of using each? We’ll be discussing all that and not a whole lot more in the second installment of Tips for Fixed-Price Jobs!

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Gather round, I want to tell you a story.

Once upon a time there was a freelancer who was looking for work. He had just finished a major project and was looking for something small that would keep some money coming in while he looked for something bigger.

He went to a job search site and lo and behold there was a job there that he thought he could do pretty easily. It involved writing a short e-book on a subject he’d already written about. This was good news because it meant he could re-use the research he’d done for the previous project. The timeline was short but that was okay because he only wanted a short term job.

The buyer did want to pay through PayPal, but that wasn’t a major issue, the freelancer had a PayPal account and a paid membership at the site so he wouldn’t have to pay an upfront fee for the job.

So the freelancer bid on the job and won it.

Now this freelancer had other things going on, he was in the middle of a move, but the job would provide a little extra income which he thought would prove very useful. So he took time off his other projects and focused on this one. It was a bit of a stretch to get it done in time, but he managed it.

The original deal had said that he’d receive half payment two or three days after the buyer got the first half of the book, and the remainder about the same amount of time after he turned in the final pages. As it turned out, the agreed-upon deadline for the final delivery was about two days after the first lot of pages had been turned in, so he sent them in even though he had not received any payment.
Oops.

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Yes, my move is still ongoing.

The good news is that I’m writing this in the new place, and am almost completely out of the old one.  The bad news is the almost.   As I write this I’m sitting at the kitchen table that is doing double duty as my work …

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