December 2015 Income At-A-Glance
Gross Income for December: $233,708
Total Expenses for December: $78,818
Total Net Profit for December: $154,890
Difference b/t December & November: +$83,198.80
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 what 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
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 December Tax Tip: The Audit Series, Part III
Fire Nation, we’re on to our third and final installment in our series on IRS audits!
Hopefully throughout this series you’ve learned you’re very unlikely to be audited, and even if you are audited, it’s likely to be a low-pressure correspondence audit. You should also have been able to take away a couple of tips to decrease your chances of being audited even further.
But there’s one issue left to tackle here: what if – despite the incredibly low percentages and following all our tips – you open the mail one day and find the dreaded letter informing you that you are being audited?
Here are three steps for getting through an IRS audit and coming out unscathed (I speak from experience here!)
3 Steps for getting through an IRS Audit
You open your mail.
You see the IRS logo in the corner.
You open it up and discover you are in fact being audited.
And panic sets in.
Step one to getting through this is to breathe.
Unless you purposely misrepresented yourself and evaded taxes, the worst thing that’s going to come of this is you will owe some money; we aren’t talking jail time here. If you follow steps two and three, then you’re going to come out of this just fine.
2. Figure out the type of audit
Figure out exactly what type of audit is being done.
As we talked about in part one, there are 3 different types of audits. Chances are, you’re just getting a correspondence audit, and all they want you to do is either mail a check or mail documentation proving their numbers are wrong.
You will never have to see them face-to-face.
If it is a little deeper than that, and they are requesting an in-office audit, then you need to figure out exactly which parts of your return they are questioning (it will be in the letter) so you don’t give them anything more than they are asking.
This can still be a relatively pain-free process if you gather the facts and follow up on only what they are asking you to do.
In the extremely unlikely event it is a field audit, it is time to immediately hire a qualified tax attorney. Things are serious here, and you don’t want to mess around.
3. Hire a professional to help
Unless it’s a simple correspondence audit you’re comfortable handling it yourself, I highly recommend hiring a CPA to help you get through your audit.
In talking with several IRS agents in the past, they’ve always told me the biggest difference between audits that are handled quickly and easily, and those that drag on and on (and end up with even bigger penalty and interest charges), are the ones that are quick and easy have a CPA involved.
In my opinion, your best bet is to hire a CPA who has experience with IRS audits. As I said above, if you are in the most serious situation of a field audit, then you may want to hire a tax attorney as well.
Otherwise, a knowledgeable and experienced CPA will be your best friend through this process and will almost certainly save you significantly more time and money than you spend to retain them.
Audits are a scary topic, especially for entrepreneurs, but if you understand how unlikely they are to happen to you, use our tips to decrease those chances even further, and then follow these steps if you ever are audited, then an audit should be the furthest thing from your mind.
Remember, as long as you’re doing your taxes the right way, an audit is nothing but a minor inconvenience!
I’m always here as a resource if you have any questions! 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!* Get instant access to Josh’s free video training course: 4 Finance Lessons Entrepreneurs Can’t Afford to Miss!
What Went Down In December
Fire Nation Elite closes
On December 31, 2015 we said good-bye to Fire Nation Elite.
Was this a tough decision? You bet; it was definitely a tough decision.
So why’d we do it?
When we launched our Elite Mastermind in July 2013, it was the first community we had ever launched. We knew it was something Fire Nation wanted and needed, and we were excited to be providing a platform for entrepreneurs to come together in order to both provide and receive support on their journey.
Over two years later, we found ourselves and EOFire in a much different place than July 2013.
We now have two additional online communities, Podcasters’ Paradise and WebinarOnFire, in addition to just preparing and experiencing our biggest launch yet: The Freedom Journal.
Just like there was a season for John’s one-on-one coaching, which wasn’t scalable and didn’t allow him to focus his time and energy on creation, there was a season for Fire Nation Elite.
In bullet, bottom line fashion, here are the 5 reasons we decided to say good-bye to FNE:
- The Tribe numbers were decreasing;
- Not all members were fully engaged;
- Our income streams have grown and are far more diversified;
- The time involved wasn’t netting a positive ROI.
Running a mastermind community is no walk in the park. Engagement, nurturing, leading, investing – it’s a full-time job to say the least.
We have only amazing memories of our experience with our FNE Family, and we look forward to continuing the strong relationships built over the past 2 and a half years.
Cheers to the Tribe and to everyone’s future success!
The Freedom Journal launch draws near
The Freedom Journal campaign launched on Kickstarter January 4, 2016 – a perfect way to start the New Year! We crushed our crowdfunding goal in just 3 hours thanks to the incredible support and enthusiasm of Fire Nation!
But leading up to the January 4 launch, there were A LOT of moving pieces – literally thousands of moving pieces – and December was a huge prep month for us.
Here’s a peek at just a few of the tasks we had on our December project plan leading up to the launch:
- Complete all 33 “Freedom Interviews” for EOFire podcast
- Create email & social media copy to share with supporters
- Email every past EOFire guest and ask for their support
- Populate Kickstarter page
- Finalize Kickstarter video
- Photo shoot for Kickstarter and promo images
- Draft & schedule social media for 33 day launch
- Write 10 blog posts for the 33 day launch
- Pitch a Press Release to media outlets
- Schedule and do guest podcasts & guest posts
- Plan & coordinate launch party
The list goes on, but you get the idea :) We pulled out all the stops and worked our rears off for this launch, and on January 4 we were ecstatic to see the results.
The best part? The ripple effect has only just begun.
We look forward to sharing The Freedom Journal journey with you in a wrap up post after the Kickstarter campaign closes in February!
Recurring Memberships in Paradise
December 1 marked the first day of our switch from Lifetime memberships to recurring memberships. We launched the new recurring memberships with 3 options:
- Annual; and
- Elite (Annual + bonus package)
Having a plan in place for the switch meant everything in terms of this being a smooth transition – but it wasn’t easy.
There was a lot to consider when switching from Lifetime to Recurring, like:
- What makes joining a no-brainer?
- How will we retain members who sign up for monthly?
- What will the engagement levels look like?
- Making the verbiage switch on all pages, posts and videos
- Updating the order forms, and the actual product descriptions
…Just to name a few.
We chatted several times about what made the most sense for us, and of course, for the community, and we came up with the idea to add a non-refundable join fee on top of the recurring membership fee. We did this because it seems like a good way to get people feeling even more invested in remaining in the community past just, say, a month or two.
Reporting recurring memberships
This switch will also change the way you see our income and expenses reported here on the monthly income reports, directly as it relates to Podcasters’ Paradise.
When we were doing lifetime memberships, we were reporting an invoice total amount.
This means if someone chose a monthly plan to join, we would report the full total of that invoice one time in our income vs. report their individual payments every single month.
This is the same way we would report refunds: when someone left the community who was on a monthly membership, we would report the entire invoice total of that membership as a refund vs. just the single monthly payment they were refunded.
Moving forward, you’ll see both income and expenses for Podcasters’ Paradise being reported as an actual gross total, meaning this is money we’ve collected (or refunded) in full.
In this month’s report, you’ll see an actual gross total for our income for Podcasters’ Paradise, but an invoice total for our refunds (since we had refunds come through in December that were still lifetime memberships from November).
Starting January, both income and expenses related to Podcasters’ Paradise will be gross total.
Reflection: A Year in Review at EOFire
December is our big reflection month, which is always such an integral time for looking back on what we’ve accomplished, and also what we didn’t accomplish (but that we wanted to) over the past year.
In our 2015 Year in Review post, I cover in detail the 5 Phases of Reflection, and if you take the time to go through these 5 Phases, then you will come out on the other side having set goals for yourself and your business.
Don’t forget to set aside time for your reflection, it’s not too late!
And if you’re looking for a step-by-step guide for how to set and accomplish your biggest goals in 2016, check out this post on the topic!
Product/Service Income: $142,388
Podcasters’ Paradise: $34,857
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: $3,335 (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!
Podcast Sponsorship Income: $99,800
Fire Nation Elite Mastermind: $4,076
The Fire Path Course: $47
Podcast Launch (Audiobook on Audible): $208
Podcast Launch (eBook on Amazon): $65
Affiliate Income: $91,320
*Affiliate links below
- BlueHost: $1,950 (Step-by-step guide and 23 WordPress tutorials)
- Podcast Websites: $3,000
- High Speed Elite: $5,000
- Create Awesome Online Courses: $8,404
- Fizzle: $1,477
- 3-minute expert: $0
- LeadPages: $710
- Ray Edwards Copywriting Academy: $25,765
- Rick Mulready’s FB ADvantage: $1,503
- Scott Voelker Amazon Sellers: $12,000
- ConvertKit: $11,807
- Marketing Inc Course: $0
- Ramit Sethi: $2,909
- Audible: $1,018
- Coaching referrals: $1,351 (email me for an introduction to a mentor for overall online business or a Podcast focused mentor!)
- Tim Paige Voice Over: $0 (ask for the Fire Special)
- Smart Podcast Player: $0
- Infusionsoft: $0
- Aweber: $0
- Amber Ludwig-Vilhauer: $0
- Fire Pole Marketing: $78
- Music Radio Creative: $0
- Libsyn: $1,460 (promo code Fire)
- WP Curve: $120
- Virtual Staff Finder: $0
- Podmastery: $10,000
- UDemy Podcasting Course: $48
- DotCom Secrets (free book): $0
- Podcasting Press: $130
- Amazon Associates: $1,303
- Other: $1,287
Total Gross Income in December: $233,708
Business Expenses: $76,587
- Advertising: $388
- Affiliate Commissions (Paradise): $14,248
- Accounting: $250
- Design & Branding: $1,485
- Training & Education: $245
- Meals & Entertainment: $1,115
- Merchant / bank fees: $65
- PayPal fees: $1,143
- Office expenses: $706
- Libsyn: $284
- Other Business Expenses: $1,549
- Promotional / events: $3,937 (Kickstarter video incld)
- Paradise Refunds: $10,285 (invoice total)
- WebinarOnFire Refunds: $1,344 (invoice total)
- Fire Nation Elite expenses: $2,038
- The Freedom Journal: $2,408 (postage & delivery)
- TheMidRoll (Sponsorships): $19,960 (20%)
- Total Launch Package Fees: $485
- Travel: $1,656
- Virtual Assistant Fees: $10,695
- Website Fees: $2,301
Recurring, Subscription-based Expenses: $2,231
- Adobe Creative Cloud*: $100
- Boomerang*: $14.99
- Brandisty: $24
- Authorize.net*: $91.10
- Cell Phone*: $194
- Dropbox (annual): $99
- Google Storage: $9.99
- Go2MyPC: $12
- HelloSign: $13
- Internet*: $174
- eVoice*: $9.95
- Infusionsoft CRM*: $448
- Insurance*: $551
- Chatroll: $150
- PureChat: $20
- ScheduleOnce*: $16
- Skype*: $2.99
- Spotify: $9.99
- Payroll fee: $77
- Workflowy*: $4.99
- MeetEdgar*: $49
- Wistia: $25
- Sweet Process: $29
- WPCurve*: $29
- Taxes & Licenses (recurring): $77
Total Expenses in December: $78,818
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 December 2015: $154,890
Biggest Lesson Learned
Make the ask, put it out there
Inspired by our 2015 Year in Review post, I’m making our biggest lesson learned for December: make the ask, put it out there.
This not only ties directly to one of my biggest goals in 2015 (to land and do 3 speaking engagements), but it also ties directly to one of John’s biggest goals: launching The Freedom Journal.
John and I were both able to accomplish these goals, and I draw both of these successes back to the fact that once we had set our respective goals, we put it out into the world. We started talking about it, letting others know what we were up to.
We also asked for support, without which neither of these goals would have been accomplished.
So if you have a big goal you’re working on, or even just a new project you’re really excited about, put it out there – tell your friends, family, your mastermind about it – and make the ask for support. These 2 things are integral in getting started on and accomplishing your goals.
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.