What Income and Expenses Do Social Media Influencers Need to Report on Their Taxes?

As a busy mom, having a home-based self-employed business has been a blessing for our family. I was lucky enough to be able to design my schedule around our kids’ schedules, which means I have more time with them while still earning an income.

However, while it is a lot more flexible than working a 9-5 job at the office, it’s still a business. Additionally, being self-employed means I have to be on top of my records — not only with my business’ day-to-day finances but with my taxes as well. 

If you’re a social media influencer or blogger like me, you may be wondering — what income do I have to claim, and what expenses can I deduct? Here are a few things you need to know.

Social Media Influencers, Bloggers, and Taxes

I know other bloggers and social media influencers, especially in other spaces like tech, beauty, and health have been approached to get free products in exchange for honest reviews. It can definitely be a win-win scenario for all involved, but as a business person, it’s important you know what qualifies as income in the eyes of the IRS and what should be claimed on your taxes. 

Did you know if you receive a product or have a trip sponsored, it is considered as compensation (aka income) to the IRS? By the way, you also want to make sure you properly disclose if you’ve been compensated per the FTC policy. 

The good news is that many in your audience are already familiar with the practice and would appreciate the transparency! 

4 Items You Need to Report on Your Taxes

This is not a complete list of what qualifies and what doesn’t, but according to the guidelines given by the IRS, you should make sure you report things like: 

• Brand Partnerships: Do you have a podcast or a video channel that a brand is sponsoring? You need to include what you’re paid as income. 
• Products: If you get a product from a brand to review, such as a laptop, camera, gym gear, or nutritional supplements, you have to report that as income at its fair market value.  
• Sponsored Posts: Typically a brand will pay you money as the creator of content – it can be a video or a post. This would also include social media promotion. Again, this is something you need to include. 
• Ads: Any income you receive from ads need to be counted as income. 

How to Report On your Taxes

Hopefully, you now understand it’s important you keep everything on the up and up come tax time, but the question now is, how exactly do you report these freebies you’ve received? 

Since you’re an independent contractor rather than an employee, you should receive a 1099-NEC reporting income earned from that brand if what you received was valued at $600 or more. You can then include that amount when you report your income on your taxes. Even if the value was less than $600, you still need to report the product you received. Make sure you keep good records, so you don’t leave anything out. 

If you received payments for goods or services through a third-party payment network like Venmo and Cash App, you may receive a form 1099-K. Under the American Rescue Plan, changes were made to Form 1099-K reporting requirements for third-party payment networks like Venmo and PayPal that process credit/debit card payments or electronic payment transfers. 

The change was to take effect with transactions starting tax year 2022 and lowered the reporting threshold by third party payment processors to over $600. On December 23, 2022 the IRS announced an initial delay and on November 21, 2023, the IRS announced another delay in reporting thresholds for third-party settlement organizations (TPSOs). As a result of this delay, TPSOs will not be required to report tax year 2023 transactions on a Form 1099-K at the lower amount of over $600. This means that for tax year 2023 (the taxes you file in 2024) the existing 1099-K reporting threshold of the aggregate of more than $20,000 in payments and over 200 transactions will remain in effect. 

The IRS is currently planning for a threshold of $5,000 for tax year 2024 (the taxes you file in 2025) as part of the phase in to implement the lower over $600 threshold enacted under the American Rescue Plan. This change could impact people working in the gig economy, online sellers, independent contractors, and other self-employed business owners.

QuickBooks Self-Employed will help you track your business income, expenses, and mileage year-round and then you can export your tax information to your TurboTax Self-Employed tax return. Even if you don’t use QuickBooks Self-Employed year-round, TurboTax Self-Employed will easily guide you through your taxes.

Tax Benefits for Bloggers and Social Influencers

Just because you’re reporting the stuff that you receive as a blogger or social media influencer as income, doesn’t mean you’ll be stuck with a large tax bill. As a business, there are business tax deductions you can take provided these qualified business expenses are directly related to your business. 

Some popular ones to look into include: 

• Phone/laptop
• Prizes (that you use for giveaways)
• Website expenses
• Software and apps (including subscriptions for stock photography and video)
• Office supplies
• Trademark and copyright fees
• Advertising

Your Thoughts on Self-Employment and Taxes

Do you have any of these expenses to deduct on your taxes? I hope these tips help make filing your taxes much easier this year. 

Don’t worry about knowing these tax rules. TurboTax Premium asks simple questions about you and your business and gives you the tax deductions and credits you’re eligible for based on your entries. TurboTax Premium can find industry-specific deductions that you didn’t even know existed.