January 2016 Income At-A-Glance
Gross Income for January: $171,219
Total Expenses for January: $63,753.75
Total Net Profit for January: $107,465.25
Difference b/t January & December: -$47,424.75
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 business owners 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
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 to make sure their accounting systems are running smoothly and their taxes are as low as possible. John and Kate have included me in the 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, 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 January Tax Tip: A Definitive Guide on Quarterly Estimated Tax Payments
A topic that causes a lot of confusion for entrepreneurs is estimated tax payments.
On the surface it seems easy: just figure out your tax liability and make quarterly estimated payments to cover it.
But in my experience, there’s a lot of bad information out there when it comes to estimated tax payments, and so for our first tip of 2016 I’m going to share the definitive guide on quarterly estimated tax payments!
First, let’s lay out the facts.
4 Facts about estimated payments
1. There are no tax filings
There are no tax filings with estimated payments. A lot of people think they are actually filing quarterly tax returns with their payments, but that’s not the case. All you are doing is sending in a check to the IRS and the state.
2. They’re made by you, not the business
Unless your business is a C Corp (and if it is, it probably shouldn’t be), your estimated payments are always made by you personally, not by your business.
3. Only if you owe > $1,000
You only have to make estimated payments if you are going to owe at least $1,000 come tax time. This means if your business is operating at a loss, or even breaking even, then you’re off the hook.
4. Due quarterly
The payments are due quarterly, on April 15, June 15, September 15 and January 15, and you can’t just make one lump sum estimate at the end to avoid the penalty – they have to be made each quarter.
Okay, so now you know what they are, who should make them and when they are due.
Now, the biggest question remains: “How much should I pay?”
How much should I pay?
The answer to this depends on what your goals are with your estimated payments.
Goal A: Avoid being stuck with a bill at the end of the year
If your goal is to come as close as possible to paying your yearly taxes so you aren’t stuck with a bill when you actually file your tax return, then you will have to look at your numbers each quarter and adjust your estimated payments accordingly.
Goal B: Avoid penalties
If your goal is simply to avoid getting hit with penalties from the IRS, then you have two options.
Option 1
Pay 100% of last year’s tax liability (110% if you made more than $150,000).
This is the easy way to do it as it doesn’t require any projections throughout the year. If your total tax liability last year was $10,000, you simply make four estimated payments of $2,500 each quarter and you’re good to go.
Option 2
Pay at least 90% of this year’s tax liability.
By paying at least 90% of what you would owe at tax time, you’ll also avoid any IRS penalties.
In closing, depending on how much money you make in your business, the penalties for not making estimated payments probably won’t kill you. However, getting behind on your taxes can create a hole that is impossible to recover from.
I’ve seen countless situations where entrepreneurs fail to plan for their taxes and end up doing crazy things like cashing out their retirement accounts to pay them come the end of the year.
This just creates even bigger tax hits the following year and the cycle repeats itself.
Part of running a healthy business is paying the taxes you are legally obligated to pay (and not a penny more!)
Doing so with quarterly estimated payments will not only eliminate penalties, it will help you keep it at a manageable amount so you aren’t hit with a massive bill come tax time.
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 our FREE course on business entities yet, you can get it here!
What Went Down In January
The Freedom Journal LAUNCHES!
Monday, January 4th marked the day The Freedom Journal launched on Kickstarter – the suspense was intense!
John woke up at 3:30am Pacific time to push “publish” on the campaign after months of our team working hard on a strategy we’d checked, and double checked, and triple checked.
When I left for the gym right about 7am, we had hit our funding goal of $25k, and John was already writing a personal check to Pencils of Promise to build our first school in a developing country on behalf of Fire Nation.
Since January 4th, we’ve put nearly all of our focus, energy and bandwidth into making sure The Freedom Journal launch was the best it could be.
Photo credit: Kevin T Photography
But leading up to January 4th, there were a lot of moving pieces and several individuals who helped make this all happen.
Our Freedom Journal Launch Team
There were multiple key players who contributed to the actual physical creation of The Freedom Journal.
John did what he did best: he came up with a great idea, started talking to others about it to flesh it out, and then got to brainstorming how he was going to make it happen.
We talk about this often here at EOFire, but it’s worth pointing out here: John knew he wasn’t going to be able to lay out the actual journal in the file format it needed to be in for printers; he also knew he had no clue what it took to go overseas and find a trustworthy factory who could help turn his idea into a physical product.
As a result, John turned to those who are experts in the areas he knew he was NOT, which included the following individuals and roles:
Sutton Long, journal layout
Richie Norton, product lead
Brandon T. Adams, crowdfunding expert
Tom Morkes, book launch manager
Brandy Shea, design / illustration sourcing
Whitney Henry, editor
Caleb Wojcik, Kickstarter videographer
Me, over-thinker and quality control ;)
We’re not kidding around – the list goes on!
Here’s a look at the journal actually being printed, bound and shipped from overseas:
See that guy standing back there behind the millions of Freedom Journal pages? That’s Richie Norton, Founder of Prouduct and the man responsible for overseeing the physical creation of The Freedom Journal.
You can hear more about Richie’s journey on EOFire episode 895 and listen in to episode 1,171 as him and John chat specifically about goals and The Freedom Journal.
A huge shout out to every individual on The Freedom Journal team for helping make this project not just a reality, but also a huge success.
From Left to Right, Top to Bottom: Brandy Shea, John Lee Dumas, Richie Norton, Brandon T. Adams, Kate Erickson, Tom Morkes
The Freedom Journal Marketing Plan: The Beginning
It started out simple: an email opt in page to gauge interest (sound familiar?)
We had an opt in page up to start an interest list before we even know when – or how – we would launch The Freedom Journal!
The content?
Pure value.
We weren’t selling anything or trying to get anyone to even click on anything – we were simply giving those who said they were interested in a behind-the-scenes look at the progress, roadblocks and mini-celebrations we experienced throughout our journey to creating The Freedom Journal just that.
We also talked quite a bit about the importance of goal setting and why we’re so passionate about helping others learn how to accomplish their goals throughout the campaign.
The campaign looked like this, and total transparency – this was NOT complete when we launched it.
Each of these emails was created week by week to share a live glimpse at where we were at with the project:
Note: those who joined after we launched the interest campaign received the emails on the schedule set. Therefore, in order to keep the entire list updated on major happenings – when they were actually happening – we’d send a 1-off broadcast to the entire TFJ list.
The TFJ interest list grew to over 10k subscribers by the time the campaign launched on Kickstarter, and it’s a great example of what we’re referring when we talk about creating segmented lists.
With the TFJ interest list, we knew every single time we were sending them info about The Freedom Journal, it was related to exactly what they told us they wanted to hear more about.
Our very first, initial push once The Freedom Journal campaign went live on Kickstarter?
You guessed it: an email to the TFJ interest list (in fact, they got a 30 minute head start on the rest of the world for signing up!)
Marketing on Social Media
We also put together several marketing campaigns to help expand our reach once the journal was live on Kickstarter – we knew getting to January 4th was just the beginning.
We also knew it would be important to have experts who could help us run our campaigns – let’s be real, we simply can’t do it all!
Our social media marketing team included:
Facebook ads, TJ Mitchell
YouTube ads, Jake Larsen
Scheduled posts, JM & Claire (Team Fire)
Launch party, Co-mmunity (event space) & Paul F. Gero (photographer)
Twitter chats, Daniel Bauer
PR, Brandon T. Adams & Tom Morkes
Writing, ME! :)
The Launch Party was a huge hit and a really fun way to bring together an amazing group of people who are all passionate about setting and accomplishing goals.
A huge shout out to Jacob, Anatoliy and the entire team over at Co-mmunity for opening up their space for us and helping us host The Freedom Journal Launch Party!
We’re also very grateful to Paul F. Gero for being our photographer and helping us capture incredible memories.
Content Marketing
But perhaps our biggest marketing campaign was our content-related one, which included solid and consistent communication between our 4 key players to set up, maintain and execute with success: Tom Morkes, Brandon T. Adams, John Lee, and – me!
Our content marketing plan included:
The Freedom Journal interest campaign (for the months leading up to the Kickstarter launch);
The 30-day PDF giveaway;
Your Goal Setting Guide giveaway (thanks Matt & Pete from Atomic!);
40 Guest Podcast episodes;
11 Guest Posts;
25 Confirmed emails from supporters;
11 updates via Kickstarter;
27 Broadcast emails sent from Infusionsoft to our interest list;
34 Interviews on EOFire (replicated on The Freedom Journal podcast).
Because it’d be crazy to name everyone who jumped in to support The Freedom Journal campaign by way of content marketing, we put together a thank you for everyone here!
Marketing the Live Campaign
Intra-campaign, John’s creativity and determination took over, resulting in over 413 up-pledges!
That’s not all…
Throughout the campaign, we introduced a total of 4 new levels that didn’t exist when we first launched the campaign, brining in an additional $33,000 in pledges.
On January 26th, we hit our second funding goal: $350k, and that day John wrote his 2nd $25k check to Pencils of Promise.
Now, every single backer of this campaign has contributed to helping us build TWO schools in developing countries through Pencils of Promise AND they’ve given themselves a priceless gift: FREEDOM.
The Grand Finale
The grand finale is scheduled for 7pm Eastern on Friday, February 5th, the evening the campaign closes on Kickstarter.
What do we have in store?
A 3-HOUR, LIVE BLAB FEST!
What’s a Blab fest? Think Google Hangouts on steroids!
Join me and JLD LIVE, and we’ll bring YOU into the spotlight, where you can ask John any question, tell a joke, or just hangout!
To ‘subscribe’ to the Blab, click here!
See you Friday, Feb 5th!
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
January 2016 Income Breakdown*
Product/Service Income: $120,840
Podcasters’ Paradise: $29,106 (42 new members + 60 recurring from December)
Create, grow, and monetize YOUR Podcast.
Free Podcast Course: $0 (it’s free :-)
A 15-day course on how to create, grow, and monetize YOUR Podcast.
WebinarOnFire: $5,326 (invoice total)
Create and present a Webinar that converts.
Free Webinar Course: $0 (it’s free :-)
A 10-day course on how to create and present Webinars that convert!
The Freedom Journal: $1,494 (We’re live on Kickstarter until Feb 5th!)
Podcast Sponsorship Income: $81,500
Podcast Websites: $3,000
The Fire Path Course: $148
Podcast Launch (Audiobook on Audible): $164
Podcast Launch (eBook on Amazon): $102
Affiliate Income: $50,379
*Affiliate links below
BlueHost: $1,950 (Step-by-step guide and 23 WordPress tutorials)
High Speed Elite: $0
David Siteman Garland’s Create Awesome Online Courses: $0
Fizzle: $1,140
Ray Higdon’s 3-minute expert: $0
LeadPages: $1,206
Kary Oberbrunner’s Write Your Story: $2,000
Rick Mulready’s FB ADvantage: $1,503
Grant Baldwin’s Booked & Paid to Speak: $317
Bryan Harris’ 10k Subscribers: $24,689
Podcasters’ Paradise Cruise: $7,829
Marketing Inc Course: $0
Ramit Sethi’s Zero to Launch: $4,025
Audible: $711
Coaching referrals: $1,359 (email me for a mentor introduction)
Tim Paige Voice Over: $0 (ask for the Fire Special)
Pat Flynn’s Smart Podcast Player: $0
Infusionsoft: $0
Aweber: $161
Amber Ludwig-Vilhauer: $0
Fire Pole Marketing: $78
Music Radio Creative: $54
Libsyn: $0 (promo code Fire)
WP Curve: $0
Chris Ducker’s Virtual Staff Finder: $0
UDemy Podcasting Course: $126
DotCom Secrets / Click Funnels: $465
Podcasting Press: $0
Amazon Associates: $972
Other: $1,794
Total Gross Income in January: $171,219
Business Expenses: $61,464.75
Advertising: $9,426 (FB & YouTube ads for TFJ launch)
Affiliate Commissions (Paradise): $5,151
Accounting: $250
Design & Branding: $4,482
Training & Education: $180
Meals & Entertainment: $836
Merchant / bank fees: $4,591.75
PayPal fees: $499
Office expenses: $215
Libsyn: $207
Other Business Expenses: $2,188
Promotional / events: $358
Paradise Refunds: $2,569
WebinarOnFire Refunds: $0 (invoice total)
The Freedom Journal: $2,576
TheMidRoll (Sponsorships): $20,375 (25%)
Total Launch Package Fees: $0
Travel: $1,050
Virtual Assistant Fees: $4,980
Website Fees: $1,531
Recurring, Subscription-based Expenses: $2,289
Adobe Creative Cloud: $100
Boomerang: $14.99
Brandisty: $24
Authorize.net: $91.10
Cell Phone: $195
Google Storage: $9.99
Go2MyPC: $12
HelloSign: $13
Internet: $159
eVoice: $9.95
Infusionsoft CRM: $448
Insurance: $551
Chatroll: $150
PureChat: $20
ScheduleOnce: $16
Skype: $2.99
Shopify: $29
Spotify: $9.99
Payroll fee: $77
PicMonkey: $33 (annual)
Tech Smith: $109 (annual)
Workflowy: $4.99
MeetEdgar: $49
Wistia: $25
Sweet Process: $29
WPCurve: $29
Taxes & Licenses: $77
Total Expenses in January: $63,753.75
Payroll to John and Kate: $18,193
In our May Income Report, Josh focused on how to pay yourself as an entrepreneur. Check it out!
Total Net Profit for January 2016: $107,465.25
Biggest Lesson Learned
Go all in with your Majority FOCUS*
There are A LOT of things to consider when creating and growing your business.
Tactics, strategies, platforms, software – where do you even BEGIN, and how do you decide what’s most important for your business growth right now?
It’s easy to let distractions halt our progress, and even worse, these distractions are what cause us to feel stressed, overwhelmed and under accomplished.
So decide TODAY that you’re going to set a single priority or goal that will get your Majority FOCUS*, and go all in.
Don’t start to research it, but then decide it’s too much work and then start on something else.
Don’t set 1 of the 4 pages up, and then say you’ll do the rest next week.
Of all the major tactics, strategies, platforms and software tools you’re considering for your business, which of them will actually contribute to your business growth?
Which of them will actually help you get one step closer to your business goals?
You can find this out by:
1. Writing out the major things you’re considering;
2. Arranging that list by priority (based on your business goals);
3. Giving your majority focus to the thing at the top and going ALL IN on that thing.
Those items that immediately fell to the bottom of your list?… Probably not so important – at least not right now.
But that doesn’t mean you can’t ever check them out. You can, and you will if you truly want to, when they end up on the top of your list.
*Majority FOCUS is the time you set aside for bigger projects in your business – 2, or even 4 hour time blocks, versus the daily or weekly tasks that get 15 – 30 minutes of time each day and help your business run.
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 Infusionsoft to track our product income, 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 Community Manager, and John Lee Dumas, Founder and Host of EOFire. Ready to connect? Twitter | Facebook | Instagram | Google+
The post EOFire’s January 2016 Income Report appeared first on EOFire Business Podcasts.