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5 Ways to Build a Downline
We all know that joining an affiliate program is worth absolutely nothing unless you have a significant sales force under your belt to promote it and build your income... You join a program, you get a replicated website with your affiliate...
Googleopoly: The Motivation Behind Gmail
Just before the close of business on Wednesday, Google announced that it will be launching Gmail, its new free e-mail service set to offer 1000 megabytes of free space to its users. This announcement comes after a flurry of changes at...
Pay per click tracking
Like many businesses that advertise online you are probably spending a portion, if not your entire advertising budget on PPC (pay per click) advertising. The problem many businesses have is being able to determine the most profitable avenue to...
PPC Easy As 123
What are PPC (Pay Per Click) search engines? How do they work? How can PPC search engines benefit my business? How cost effective are PPC search engines? How fast can I gain new cliental by using PPC search engines? Where do I go to find the...
The 5 Best Revenue Models in E-Commerce History
There was a time, back in the 20th century, when everyone wanted
to have their own online shopping cart system. By 1997,
Amazon.com had served their millionth customer and was really
starting to impress regular folks. The internet looked like...
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Accounting for Affiliate Marketers
If you are an affiliate marketer, then you are in business. Therefore, you should treat it like a business. Keep in mind that Linkshare, Clickbank, Commission Junction and all the other affiliate marketplaces are going to report your earnings to the IRS.
Each of them requires that you provide a Social Security Number or EIN number when you apply with them. These numbers are used to report your earnings. At the end of the year, you'll receive a 1099 form which is the IRS earnings document given to Independent Contractors.
Since you have to pay taxes on your income, you should take care to make sure that your income is properly calculate. Remember, gross adjusted income is going to be the total amount that you earned - your expenses. For this reason, you really need to keep track of all of your affiliate marketing expenses.
Keep receipts and track all the following:
* Web Hosting Costs
* Affiliate marketing tools (such as your WordTracker membership fees, the cost of products like Adwords Analyzer, etc.)
* Any PPC advertising that you purchase.
Don't do as I have been prone to do and wait til the end of the year before you start putting these numbers together. You'll forget many and you won't be able to gain access to others.
For example, with PPC advertising, Google seems to keep records online forever. Great. But Overture only keeps the last 90 days and you can't - I repeat - You CAN'T get those records older than 90 days. (Ask me how I know :(
Getting receipts means that you'll have to think ahead. When you buy something
online, print the receipt page. When you subscribe to a service that may pull a fee from your checking account or credit card account on a monthly basis, make sure to opt in to any e-mail notification of transactions that you might be able to get.
Print everything out and put it in a folder for that years tax records. You won't regret it when tax season comes along.
You will also get a much better picture of how much money you're earning. I think a lot of affiliate marketers brag about their checks, but conveniently forget that out of the $10,000.00 they earned last month, they spent $8,000.00 for PPC advertising, $27.00 for Wordtracker, $100.00 for their web host, ect, etc, reducing their actual profit to enough to buy some bubble gum.
There's great software that makes all of this easier of course. Quicken or MS Money Home and Business editions or PeachTree accounting would all make the whole process of tracking these numbers much less painful.
Finally, there are real benefits (and some costs) to incorporating yourself. Incorporating changes the tax rules and create scenarios that let you put more of your profit into your pocket. They also help to shield you from liability. I'm not a lawyer, so I'd recommend talking to an tax law lawyer. I incorporated in Florida and the entire expense was about $495.00.
About the Author
Charles Waters discovered the wonderful world of affiliate marketing in 2003 and has never looked back. Today, he operates several successful money making web pages, including The Affiliates Home.
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