Affiliate Marketing Taxes

Affiliate Marketing Taxes

Affiliate marketers in the US are required to pay taxes on their earnings, similar to other professions. An exception exists for earnings below $600; in such cases, filing taxes may not be mandatory. If an affiliate marketer surpasses the $600 threshold, they must file taxes with the IRS, specifically using Schedule C during tax season.

What Taxes Do Affiliate Marketers Pay?

Affiliate marketers are obligated to cover both the employee and employer portions of Social Security and Medicare taxes, constituting a 15.3% self-employment tax. Additionally, affiliate marketers may be required to make estimated tax payments for state and federal income taxes to the IRS.

What About Tax Deductions?

Expenses related to your affiliate marketing business can qualify as tax deductions. Here’s some possible expenses you may be able to claim all or part of:

• internet fees
• retailer subscriptions (Prime, Walmart+)
• office supplies
• cell phone
• computer and computer equipment
• advertising fees
• creative software or subscriptions
• Website domain registration and renewal fees
• professional services (website, CPA, etc.)
• payment system fees (PayPal)
• banking expenses
• social media posting software
• portions of your home and utilities
• tax software
• tax preparation fees
• business cards
• social media account verification fees
• video editing software
• employee pay & contracted labor
• posting fees
• education & training expenses
• meals & travel expenses
• email marketing expenses
• startup expenses
• office equipment (desk, chair, etc)

Tax Preparation Software

To streamline year-round expense tracking, explore the use of small business tax software for efficient financial organization. Here’s a few options that can make keeping up with your business’s financials much easier.

Tax Tips

1. Keep receipts for everything!
2. Make tax related work a part of your weekly/monthly routine.
3. Keep business and personal transactions separate.
4. Automate where you can.
5. Consider using one payment source for all expenses.

This article is not intended to be tax advice. Contact a tax professional.

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