Live-streaming is a great way to entertain. It’s also lucrative once you’ve mastered it. It’s a great way to do what you love while generating a substantial amount of cash. Like all businesses, successful streamers must pay taxes. If you’re starting out on your streaming journey, you might be wondering what types of taxes you’ll be asked to pay.
According to the Internal Revenue Service (IRS), for U.S. streamers, live-streaming is a taxable business once you meet certain income levels. In this blog post, we’ll be discussing deductions and engaging in a thorough breakdown regarding how much tax you’ll be paying based on your streaming income.
Please note: The materials provided are for informational purposes only. They should not be replaced as tax, legal, or accounting counsel. If you have any questions or concerns regarding your taxes, seek a professional tax advisor. Some reliable resources that you can use for the most up-to-date information regarding taxes are TurboTax and H&R Block. You can also use a tool such as QuickBooks ProAdvisor to find an accountant that specializes in your specific tax situation and niche.
What is Taxable Revenue?
For live streamers, taxable revenue usually includes revenue earned from advertisements, donations/tips, sponsorships, and payments from the streaming platform you’re using.
Federal Taxes for Streamers
Filing your taxes as a streamer is serious business. A lot of people don't realize this, but if you're making money streaming, you're considered to be self-employed. That means it's your responsibility to track your own income and expenses.
Your deductions come from your total earnings before you determine taxable earnings. You can use Schedule SE to determine your taxable earnings—this can easily get complicated so we recommend talking to a tax professional to understand what expenses are tax deductible.
Once you've figured out your taxable earnings, you can begin calculating your taxes. Schedule C (Form 1040) is where you will begin to file your taxable income. What's great about Schedule C (Form 1040) is that it allows you to write off your business expenses. You can see some tax deductions you can write off as a Twitch streamer further down.
Other Important Tax Documents
In addition to Schedule C (Form 1040), you'll also fill out a W-9 form, which is an official form that documents your business information. If you're a partner on Twitch, you'll also fill out the W-8BEN form, which is mandatory for Twitch partners. Make sure you keep all of these forms safe. You'll need them when it comes time to file your taxes.
An Important Note Regarding Streaming Taxes
The materials provided here are for informational purposes only. They should not be replaced as tax, legal, or accounting counsel. If you have any questions or concerns regarding your taxes, seek a professional tax advisor.