Sometimes, another writer, upon learning that I'm both a book author and tax accountant, asks me for the best ways that authors can minimize their income taxes.

If I can, I try to weasel my way out of the discussion, offering up such basic tidbits as, "Well, be sure to look at the home office deduction." And "do use a basic accounting program like Quicken or Microsoft Money so you capture all of your writing business expenses."

Usually, those simplistic answers work. Usually, after dolling out such drivel, the guy waunders off to get another drink and more appetizers.

Everyone once in a while, though, I encounter some writer who's really motivated to save on taxes. Usually, someone now making good money writing... When I can't deflect their questions in some other way, I tell them about the three best ways that authors have to save on taxes.

Technique #1: Smooth Your Income

Whatever you think of the US Internal Revenue Code, you need to know that it's quite progressive. That progressivity means the more you make, the more you pay. The progressivity also means that if your income fluctuates, your income taxes go up even if you make the same money on average as someone else makes whose income is steady.

To give you an example of this, suppose that you compare two writers, John and Jane. If John makes a steady $60,000 a year and has a mortgage, a spouse and couple of kids, he might pay about $1000 over four years (net of tax credits such as for children.)

In comparison, suppose that Jane averages $60,000 a year, but sees her income fluctuate between $30,000 a year and $90,000 a year. She still makes $60,000 a year on average. Yet if she also has a spouse, two kids and a mortgage, she'll probably pay $8,000 to $10,000 in taxes over those same four years.

Please note that over the same four years, then, the two writers make the same amount of money: $240,000. But what they pay in taxes differs radically. Jane pays eight to ten times what John pays! Yikes!

What can Jane do? Well, let's bring this back to the example of working writers. Jane can probably rather easily smooth her income. She can make sure that she's not stacking two big advances in the same year. She can spread out advance payments over two or more years. She can even try to stuff more of her expenses into the good years. In the good years, for example, she can buy new computers, take those graduate classes, or top off her pension.