In this episode of the Six Figure Author Experiment, Lee and Russell are joined by Seth Norris, CPA and founder of Author CPA. Together, they demystify accounting, taxes, and cash flow for authors, with a focus on the popular Profit First method. Seth explains how authors can structure their finances to increase profit, manage ad spend, and avoid costly tax mistakes. From S-Corps to home office deductions, they cover practical strategies to help authors keep more of what they earn while building a sustainable business mindset.
Topics Covered:
Why most authors avoid money conversations—and why that’s a mistake
The core principles of the Profit First method
How to use multiple bank accounts to enforce profit, taxes, and expenses
Recommended Profit First percentages for authors under $250K/year
What “real revenue” means and why ad spend may belong in cost of goods
Challenges of funding growth and why debt can be dangerous
How to reinvest profit and owner pay strategically
The role of intellectual property as an asset in author businesses
When and why to consider switching from sole proprietor/LLC to S-Corp
The true tax differences between LLCs and S-Corps
How “reasonable compensation” works under IRS rules
Smart ways to save on taxes: SEPs, Solo 401Ks, and home office deductions
Hobby vs. business rules and how to prove intent to profit
Why mindset matters: paying yourself and thinking like a business owner
Memorable tax court cases authors can learn from (including a brothel research deduction!)
Building systems that support sustainable growth and financial confidence
Website: authorcpa.com
Youtube: youtube.com/@authorcpa
Newsletter: norriscpafirm.com/newsletter
