Do streamers need to pay taxes? Lots of paid Twitch streamers are questioning if they must pay taxes. Don’t worry; in this “Twitch Guide to Taxes,” we’ll explain all you need to know about paying taxes from Twitch. Keep scrolling to find out together!
Twitch Guide to Taxes: Do Twitch Streamers Pay Taxes?
Do Twitch streamers pay taxes? The answer is a definite yes.
The amount of taxes you pay depends on various factors, such as your total earnings and your citizenship status:
- For US citizens, 15.3% of total Twitch earnings go to the IRS, with 12.4% for Social Security and 2.9% for Medicare.
- Non-US citizens owe the IRS 30% of their revenue.
If you make more than $600 a month, you fall under the self-employment category, and you must pay self-employment taxes. However, if you make less than $400, you don’t pay self-employment taxes, but you are still liable for income taxes.
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Easy Way to Track and Pay Twitch Taxes
You can report your total income on Twitch with these simple steps:
- Log into your Twitch account.
- Go to “Royalty” row.
- Click “View” or “Edit”.
- Find forms button in the “Year-End Tax Forms”.
- Choose “1099” form to fill in.
To make tax filing easier, consider using third-party budget tracker apps like Keeper Tax. These apps automatically analyze your income and expenses, helping you keep track of deductible items and streamlining the tax-filing process. Remember to pay your tax in time as well to avoid penalties or other financial problems.
Twitch Donations and Taxes
How about Twitch donations? When it comes to Twitch donations, streamers must pay taxes on these earnings as well.
Although donations may seem like gifts, they are considered income sources that need to be reported. Non-profit organizations are exempt from taxes on donations, but individual streamers must declare them.
What Qualifies as an Expense for Live Streaming?
Determining expenses for live streaming can be challenging as the industry evolves rapidly. Generally, qualifying expenses are those considered necessary for content creation or live streaming. For instance, equipment like cameras that enhance video quality and enable interaction with the audience are valid expenses.
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Conclusion
Understanding and fulfilling tax obligations is crucial for Twitch streamers to avoid penalties and maintain a profitable streaming career. Always remember to report your income accurately and stay updated on tax changes in your country or region. Good luck, and happy streaming!
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