Tax Tips For Bloggers: The Basics
Sometimes when numbers get involved people tend to tune out. There are a lot of little things to know when it comes to filing taxes so we’ve put together a list of some of the most important to help you out.(Just a friendly reminder that this article applies to only those filing taxes in the United States.)
Here are 10 things that every blogger should know about tax deadlines and how to do them right:
(1) Personal taxes are due in April.
The tax return filing date for individuals is April 15th of every year but sometimes that can change depending on a holiday. It’s always a good idea to plan for April 15th and if you end up with some extra days just count those as a bonus. If you can’t get it together by the deadline, then make sure you file an extension to give you some extra time.
(2) If you’re operating your blog or social media accounts as a business entity then the tax filing date may be different than when your personal taxes are due.
If you’ve taken your influence to the next level and are operating it as a business entity then you’ll need to know when the filing deadline is for that specific type of entity. For example, all LLC, S-Corporation and Partnership taxes are due on March 15th of every year, while Corporation taxes are due on April 15th. It’s always good practice to double check around the first of every year to make sure the filing date hasn’t changed due to a new law or it falling on a holiday.
(3) If you earn income you need to report it, no matter what.
If you’re wondering “What do bloggers need to claim for taxes?” – the answer is pretty simple, almost everything. If you get paid for partnerships, sponsorships or collaborations then you will need to report that income on your taxes.
(4) If you get free product or trips that may count as income too.
Just because you didn’t get paid cash money for a partnership or collaboration doesn’t mean you’re in the clear. If you get free products or free trips then you received value and may have to claim them on your taxes. Depending on the partnership, you’ll need to report the “fair market value” of whatever the product, service or trip is so make sure to ask the company or host upfront, so you don’t have to try to figure it out on your own. We definitely recommend checking with an accountant or CPA to make sure you’re claiming what you need to and skipping what’s not required.
(5) If you work with freelancers, independent contractors or other service providers you may need to provide them with a Form 1099-MISC for their taxes at the beginning of the year.
Maybe you hired a part-time social media assistant to help you with posting on Instagram or a photographer to shoot some photos of you for a brand partnership – if you paid anyone at least $600 for a service and plan to write it off on your taxes, then you’ll need to file a Form 1099-MISC for each of them to prove it. This goes for whether you’re operating your business as an individual or entity. Just FYI- 1099’s are due on January 31st to the individual contractor or service provider and have to be sent to the IRS by February 28th (by you or your accountant).
(6) You may be required to pay estimated taxes throughout the year.
If you’re a freelance blogger then you may have to pay estimated taxes since you don’t have them deducted like a traditional employee. There are various due dates throughout the year that you’ll need to comply with – they are April 15th, June 15th, September 15th and January 15th. There are some exceptions to this rule where you may not have to pay estimated taxes quarterly. For example, if you don’t earn at least $1,000 in blogging income then you may be in the clear. Definitely double check with an accountant to see what applies to your situation.
(7) You may have to pay self-employment taxes.
If you’re a blogger or monetizing your social influence then the government sees that as you running your own business (and you should too!). Basically self-employment tax is paying the taxes your employer would pay on your behalf (or take out of your paycheck) on your own. Even if you have a 9-5 salaried job and blogging is your side hustle, you’ll still have to pay self-employment taxes on the blogging portion of your income.
(8) You can deduct certain legitimate business expenses that are considered both “reasonable and necessary” to run your business.
There are certain tax deductions for bloggers and freelancers you can take advantage of to lessen the money you owe to the government. If you’re running your blog or social media accounts as a business, then there are expenses that will come up to do so. For example, drones, computers, that new iPhone to shoot stories. It’s important to keep track of all of the money you spend on your business throughout the year so when tax season rolls around you’ll have that info handy.
(9) You need to know if your blog or social media business is considered a “business” or “hobby” by the IRS so you can accurately file your taxes.
Figuring out if your blog or social media influence is a “business” or “hobby” according to the IRS is a major step in understanding your tax liability. It’s also important to know how to classify your business because there are special rules and limits for deductions you can claim if your blog is considered a “hobby” versus a “business.” Just FYI – the IRS uses 9 factors to make the determination and you can find this list on their website.
(10) The most important of all of these tax tips for bloggers is that YOU ARE responsible for accurately reporting your income.
Basically, don’t be shady. Make sure you accurately report your income to the IRS and only take deductions that you’re actually allowed to take. It’s totally not worth the risk.
