Social media influencers (generally) don’t have a lot of extra time in their day to manage proper tax preparation.
This is a career driven by constant content creation and almost around-the-clock engagement with their followers.
A lot of work goes on behind the scenes to keep a social media influencer operation running. Photography, filming videos, editing, writing, marketing, promoting, managing brand relationships – the list goes on and on!
The last thing that social media influencers are looking to do is take on even more responsibility, particularly when it comes to crunching numbers, combing over IRS forms, and cutting checks to cover tax responsibilities.
Influencers wondering if it’s time to get professional tax prep help (probably) have a good idea of what the answer is going to be already:
Absolutely!
Getting Serious About Social Media as a Business
The moment an influencer starts making real money online is the moment they should begin thinking about working with tax prep professionals.
“Influencers” making a few dollars every now and again probably don’t need professional tax prep assistance. But as soon as a $600 income threshold is crossed, the IRS is technically going to consider those influencers a “business” – and it’s important to have a plan in place for handling taxes the second this happens.
A lot of influencers are surprised to learn that (almost) every aspect of their taxes change with this business.
No longer are influencers taxed as W-2 employees. Instead, they’ll have to sort through multiple 1099 forms from each of the businesses and brands they partner with, all while paying the self-employment tax (15.5%) as well.
Combine that with having to track each penny of income and all expenses for their influencer business on top of handling all “normal” business responsibilities on a day-to-day basis.
Finding the right tax prep professional becomes a priority pretty quickly.
When Brands Want to Partner, It’s Time to Talk to Tax Pros
As soon as brands want to partner with influencers (and money or gifts are about to change hands) it’s time to start thinking about tax preparation.
Freelancers understandably may not want to invest in tax prep before any cash starts coming through the door. But the moment that they start to get paid for their influence and access to their followers, they need to start thinking about covering their responsibilities to the IRS.
This isn’t the kind of thing that can be done on-the-fly. It’s definitely not something that can be done after money starts to hit influencer bank accounts either.
It’s important to get out in front of tax prep as early as possible to avoid headaches later down the line.
Influencers Should Lean on Real professionals for Tax Prep
Sooner or later, social media influencers will discover that it’s a good idea to have professionals handle tax preparation for them so they can focus elsewhere on their business.
At the end of the day, though, not every tax prep professional understands the ins and outs and subtle nuances of the influencer world.
This is why it’s so important to work with professionals like those at Robert Hall & Associates.
These are the kinds of tax prep professionals that have years of experience in the entertainment world, working regularly with social media influencers.
Robert Hall & Associates can help structure influencer businesses strategically and assist with tax prep so that influencers keep more of their hard-earned money without getting into hot water with the IRS.
For more information contact these professionals today!
References
https://www.businessinsider.com/personal-finance/when-influencers-need-professional-tax-help-2020-5
https://www.gobankingrates.com/taxes/filing/should-i-pay-someone-to-do-my-taxes/
https://www.thebusinesswomanmedia.com/5-signs-need-tax-professional/