If you’re curious how to write-off business expenses as a content creator or social media influencer, you’ve come to the right place. By knowing what your deductibles are, you can save money on taxes on your annual tax return!
According to the Internal Revenue Service (IRS), social media influencers, bloggers and/or content creators are classed as sole proprietors.
This means that content creators can deduct certain expenses from their tax bills and ultimately pay less tax—just like freelancers and other self-employed individuals.
However, you may not know which deductibles apply to you and which don’t. That’s why we’re here to help.
While we’ll leave the finer details to the IRS itself, here’s our simple yet handy guide to tax write-offs for content creators.
Where do social media influencers report their expenses?
First things first, let’s go back to basics. Being self-employed, you won’t receive a W-2 from the companies you work with as a content creator. On the contrary, you’ll get a Form 1099-NEC from the brand partners that pay you $600 or more.
Make less than $600 with one brand partner? It doesn’t matter—you still have to report all income received on your tax return.
When it comes to the 1099 form, all income and expenses related to your content creation business must be declared in Schedule C, Profit or Loss From Business. You can then subtract your tax write-offs from your gross income to get the net profit or loss from your business.
What are business expenses for content creators?
The IRS claims that a business expense must be “both ordinary and necessary” to be deductible. In other words:
- Ordinary expenses are “common and accepted” in your industry.
- Necessary expenses are “helpful and appropriate” for your business.
This means that you can’t just write off any old expense as a business expense. It has to affect the day-to-day runnings of your business and be considered essential.
Here are the common tax deductions you should know:
Business operations tax deductibles
Operation tax write-offs relate to the expenses of running and managing your business on a daily basis.
- Gear and equipment: Think lighting, cameras, sound equipment, props—basically, anything you use to shoot your content is tax-deductible.
- Home office: Curious about working from home tax deductions? If your home is your primary place of business, a portion of your utility bills, internet costs, rent or mortgage and property taxes are eligible for tax deduction.
- Phone: Because you use your phone to manage your social media accounts, respond to comments, and record and edit content, a portion of your phone bill can be written off. However, this only applies if you have a phone for both work and personal use.
- Office supplies and equipment: Anything you need to use in your home office for your small business, such as a printer, desk, chair, lamp, writing utensils, paper, etc., is eligible for tax deduction. This includes computer-related costs, such as the computer itself, external hard drives and/or memory cards.
- Software: You know the paid software you use to edit content or improve the operations of your small business? These costs are write-offs, whether it’s an Instagram feed planning app on your phone, an invoicing app on your tablet, or a photo editing program on your desktop.
- Inventory costs: Have you grown your small business to a point where you can sell your own merchandise and have to store it at home or in a storage unit? If so, you can write off any fees associated with self-storage.
- Shipping and postage: If you have to ship merchandise to customers or giveaway products to winners, these costs are deductible from your tax bill.
- Payment processing fees: Do you use PayPal or a similar app to receive payment from brands? You don’t have to absolve those fees yourself, you can write them off—but only if you have a business account.
- Bank fees: If you have a business bank account and there are monthly or yearly service charges, these can be deducted from your tax bill. Likewise, if you have a credit card provider for your biz, any associated charges are deductible.
- Outsourced services: If business is booming and you’ve enlisted the help of a professional, whether it’s an accountant, Virtual Assistant, or Social Media Assistant, any fees you’ve paid can be written off. Similarly, if you have to seek legal help for business set-up or contract issues, these legal fees can also be written off.
Insurance tax write-offs
Insurance is another part of your business expenses. Here are some insurance tax write-offs that are worth knowing as a content creator:
11.Rental or homeowner insurance: If you work from home, you can write off a portion of rental or homeowner insurance.
12. Self-employed health insurance: If you’re self-employed and pay healthcare premiums for yourself, your spouse and your dependents, you can deduct these costs from your tax return.
13. Instagram insurance: A creator gets hacked on average every 10 minutes in the U.S alone - including those with two factor authentication. So if you earn revenue via Instagram, insuring your account against hacks is a must.
Notch’s Instagram insurance starts from just $8 per month and can be written off from your tax bill.
Advertising tax write-offs
Advertising tax write-offs are associated with the fees you pay to promote, market and grow your business. Here are the relevant advertising tax deductions for social media influencers:
14. Website expenses: Do you have your own website? Set-up and maintenance fees are eligible for tax deductions, as well as domain, professional web design and image costs.
15. Online marketing: If you pay to run Facebook ads or use Google Adwords to increase your audience size, you don’t have to pay taxes on these fees. The costs of giveaway and competition prizes are also tax-deductible.
16. Networking events: If you have to attend a conference or meet-up for content creators, any associated fees can be written off.
Travel tax write-offs
The following tax write-offs relate to the travel costs you incur because of your biz. Note, these costs can only be claimed if they incurred away from your primary place of business.
17. Food and drinks: If you have to meet up with brands over a meal or coffee, these costs can be deducted from your tax bill.
18. Transportation: Whether you have to travel 30 minutes or four hours, any transportation costs to get to brand meetings can be written off. This includes petrol for car trips, flight fares and baggage fees.
19. Accommodations: Do you have to stay overnight somewhere when you’re meeting clients because it’s too far to travel back? Any accommodation fees are tax-deductible.
20. Office rental: If your brand partner requests a private office or co-working space for your meeting, it will cost you to rent one. Fortunately, these fees won’t apply to your tax bill.
Other tax write-offs
The following tax write-offs relate to the miscellaneous costs of your content creator business.
21. Professional development: Why should you have to pay taxes on your professional improvement? If you purchase any courses, books or coaching packages, or have to travel to and from your place of education, the good news is that all these costs are tax deductibles.
22. Tax advice: Tax returns can be confusing even if you’ve been filing them for years! Struggling to fill out your 1099 form or need some tax advice? You can always enlist the help of a tax professional, accountant or tax software. And the benefit of this is that you can write off their fees when you file your return.
23. Clothing and beauty products: If you’re the star of your content, you have to look and feel your best in your photos and videos to perform the best. Any clothing or beauty products you need to buy for your business (including accessories, hair tools or costume makeup) are tax-deductible, as long as it’s not solely for personal use.
24. Student loan interest: Did you take out a student loan to be able to afford your college education? If so, you’re able to deduct up to $2,500 in interest each year from your tax bill.
25. IRA contributions: If you contribute to an IRA to save for retirement, you don’t have to pay tax on this money.
26. Self-employed tax: 1099 contractors have to pay for both employee and employer Social Security and Medicare Taxes (15.3% of net business income). To compensate for this, the IRS allows independent contractors to write off half of your self-employment tax so that it will lower the overall tax amount that you owe.
27. Tax on gifts: There’s some confusion over whether content creators have to pay taxes on gifted products or trips. Generally speaking, if you’re expected to perform a service in exchange for the gift, you’ll need to pay tax on the value of the gift.
That said, if the gifted products have a total value of less than $100, the value of these items can be left off your tax return.
Taxes can take a huge chunk out of your income as a professional content creator or social media influencer. That’s why it’s important to find out the tax write-offs you’re eligible for and remember to deduct them from your tax return.
The more deductibles you apply, the higher the amount that comes off your taxes, and the more income you’re left with!
That’s especially true when you get insurance for your Instagram account - not only is it a tax write-off, 85% of brands say they’d pay extra to work with insured influencers.
Just be sure to keep receipts and record your expenses as you go to help speed up the process of filing your return.
This article is intended as knowledge-sharing, not tax, financial, or legal advice. Always consult with tax/financial/legal professionals to determine what’s best for your business.