In the past two – three years brand influencing has changed quite a bit. No longer do celebrities influence our every purchase or travel decision, but individuals who’s posts inspire and gain a strong following are now considered influencers or micro-influencers.
It’s a $500 million industry today that will grow to $5 billion to $10 billion by 2020.
If you are starting to represent different brands or already a full fledged influencer rockstar then we have a few tips & tricks on knowing how and when to report your earnings to the IRS. As influencers sometimes you are given products/services and there is no paper trail, but it is important to keep records all year to make sure you are ready for tax season.
When you to Report Income Tax
- If the product/service is more than $100
- You receive a product/service less than $100 on a
- Earning more than $6,000 in monetary/not monetary in a year
- You are considered a part-time blogger/tuber
- Brand gives you a gift for reviewing a different item
- Costs of maintaining your website (web fees, payment to freelance writers)
- Costs of items you needed to write your review (food costs if you are writing a food blog)
- You can claim your home office and deduct a percentage of utilities and insurance
- Advertising your business (this includes networking conventions)
- If you are searching for a new campaign (if it’s in the same line of work)
- If your influencer business is hobby, then you can only deduct expenses that amount to your income. Deductible can only be excess of your business if your influencing is a serious pursuit.
Always keep record of what you have done for the year, who has given you products and services even when there is no contract or form proving so.
If you need any help Semaphore Tax is always here to help. Please get in contact with one of our experienced tax professionals. Call us at 866-736-2444.