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If you made money streaming on Twitch last year, you might have received one or more tax documents called Form 1099. This document reports the total payouts you received from Twitch during the preceding year.
Twitch sends Form 1099 to both you and the IRS. You’ll use it to file your tax returns and potentially pay taxes on the income. The IRS will use the 1099 to verify that you’ve reported the correct amount on your tax return.
Whether you’re a tax novice or tax DIY-er, in this guide I’ll walk you through the tax filing process: from understanding your filing requirements, to gathering your documents, and how to file your tax returns. At the end I’ll throw in a few tips to ensure a less stressful tax season.
Let’s dive in.
What is the Twitch Form 1099?
Form 1099 is an informational document that Twitch provides to you and the IRS. It reports the income Twitch paid to you during the year.
Form 1099 is not a tax return. It’s a document that you’ll use to prepare and file a tax return. If you’re an individual (i.e. not filing as a corporation or partnership), your tax return is Form 1040. You’ll either owe taxes or get a tax refund based on the income, deductions, and credits reported on Form 1040.
This is important, so I’ll say it one more time: just because you received a 1099, doesn't mean you filed and paid your taxes. A 1099 is an informational form. It is not a tax return. You’ll still need to file a tax return. The tax return you need to file is likely Form 1040.
You might also receive 1099s from other platforms and partners related to your streaming. You’ll need all these forms–from Twitch and other sources–when filing your tax return.
Twitch Forms 1099
You can receive up to two tax forms from Twitch: Form 1099-MISC and 1099-NEC. Each 1099 has different reporting thresholds so, depending on the amount and type of revenues you earned, Twitch may not have sent you either type of 1099.
PayPal Form 1099-K
PayPal might also send you a Form 1099-K if that’s where your Twitch payouts are sent to. In that case, some of your income might be reported twice: once on the Twitch 1099 and again on the PayPal 1099.
You’ll need to reconcile the amounts when filing your tax return to avoid overreporting your income. You’ll reconcile by first determining the extent to which your PayPal 1099-K includes Twitch payouts that were already on your Twitch Forms 1099. You then subtract the duplicative income on Schedule 1 of Form 1040.
Other tax forms
Additionally, if you receive donations outside of Twitch while streaming or have an online store, your payment processor (e.g. PayPal, Stripe, etc.) may have issued you a Form 1099-K. You’ll receive a Form 1099-K if you received more than $5,000 through the payment processor.
You may also have been issued a Form 1099-NEC from affiliate link or sponsorship partners. If you received more than $600 from these partners but haven’t received a 1099, you should follow up with them.
Understanding your Twitch tax forms (with examples)
It’s important to review your 1099s before filing your tax returns. If something’s not correct you might end up paying too much tax.
Example: Form 1099-MISC
Payer’s Information
The 1099-MISC should include Twitch’s tax information, including their company name and TIN (“Tax Identification Number”). If this information isn’t associated with Twitch, then you’re looking at the wrong 1099-MISC. You’ll need to track down the correct 1099-MISC.
Recipient’s TIN
The 1099-MISC should be associated with your name and Tax Identification Number (SSN or ITIN). You should review both before filing your tax returns. If either is incorrect, follow up with Twitch support to get a corrected 1099-MISC.
Box 2. Royalties
The 1099-MISC includes all payouts you received from Twitch for subscriptions and ads. You should review your bank statements to confirm that the total amount of payout deposits matches the amount reported on your 1099-MISC. Follow up with support if you notice any discrepancies.
Example: Form 1099-NEC
Box 1. Nonemployee compensation
Your payouts for cheers and other non-standard revenues are reported in Box 1 of Form 1099-NEC. As with the 1099-MISC, you should review your bank records to confirm that the total amount of payouts received agrees to the amount reported on 1099-NEC
Example: Form 1099-K
Box 1a. Gross amount of payment card transactions
Form 1099-K reports the gross amount of payments received from your payment processor.
The gross amount is what you earned before processing fees. If the amount that was deposited into your bank account differs from the amount on your 1099s, you should take a deduction for processing fees on your Schedule C to avoid overreporting your Twitch income.
Twitch won’t issue a Form 1099-K. You’ll only receive this form if you receive Twitch payouts through PayPal or use another payment processor to receive donations.
Calculating taxable income as a Twitch streamer
As the sole proprietor of a streaming business, you’re obligated to report all income and deductions associated with that business. You’ll report your business income on Schedule C of your income tax return. You’ll then take deductions against the income that lower your taxable income.
Taxable income for Twitch streamers
As a Twitch streamer you might earn income from various sources. Regardless of where you earned it–on or off Twitch–if it’s income associated with streaming you’ll need to report it (even if you didn’t receive a tax form).
For example, you might sell merchandise through an online store that you promote on your Twitch channel. This is a third-party platform and wouldn’t be included in your Twitch 1099s. You’d need to add income earned from your online store to the amount that’s reported on your Twitch 1099 when calculating taxable income.
As another example, you might have received payments for brand partnerships. These payments would be taxable even if you weren’t provided with a Form 1099-NEC. You’ll group these payments with your other Twitch income on Schedule C.
Tax write-offs for Twitch streamers
As a streamer, you may incur costs to grow your audience and manage your business affairs. You can deduct these costs from streaming income on your tax return. Taking deductions will decrease your taxable income, lowering the amount of tax you’ll pay.
To be deductible, the IRS requires a deduction to be “ordinary” and “necessary” to your business. Ordinary means that the expense is common and accepted in the industry. Necessary means that the expense is helpful and appropriate for your business.
Furthermore, you can only deduct an expense to the extent that it’s used for business purposes. You might, for example, use some equipment personally when you aren’t developing content. You’d decrease the cost of this equipment by the extent to which you used it personally to determine the deductible amount.
Use good judgment when it comes to tax deductions. Be prepared to justify each and every deduction in the event that the IRS audits your tax returns.
Here’s a list of deductions you might take as a self-employed streamer.
Streaming Expenses
- Outside services (assistants, commissioned art, editors, etc.);
- Payment processor fees (Stripe, PayPal, etc.);
- Software subscriptions (Streamlabs, Lightstream, vMix, etc.);
- Game purchases (deductible to the extent played during streaming);
- Cost of merchandise sold through online stores;
Assets
- Furniture (desks, chairs, risers, etc.);
- Hardware (cameras, microphones, stream deck, etc.);
- Gaming systems;
Other Deductions
- Health insurance premiums
- Personal vehicle
Home Office
- Home utilities (water, electric, heating, etc.)
- Repairs & maintenance
- Mortgage insurance, interest, property taxes
- Rent
For more deductions, including detailed explanations of each deduction, check out my comprehensive list of the top tax write-offs for Twitch streamers.
Tax basics for Twitch streamers
The taxes you’ll pay as a streamer depend on a few different factors, including where you live, your age, and whether you’re a hobbyist or self-employed streamer. Let’s walk through the various taxes and filing requirements you might face as self-employed streamer.
Filing a tax return
Income earned from streaming on Twitch is taxable income. This means that you may need to file a tax return with the Internal Revenue Service (“IRS”) and, depending on where you live, your home state.
Think of your tax return as a report of taxable income that you send to the IRS. The IRS uses the report to determine your tax liability. If you owe taxes, you’ll make a payment to settle up. If you’re due a refund, the IRS will deposit the refund into your bank account via direct deposit or they’ll mail you a check.
U.S. citizens and residents must file Form 1040, U.S. Individual Tax Return if they meet the annual filing requirements. Your state has a separate tax return, unless you live in a state that doesn’t have an individual income tax.
As a Twitch streamer, you’re required to file a tax return if you earned at least $400 in combined income from Twitch and other streaming platforms. There may be other situations where you’re required to file, especially if you also have a job. Consult the IRS’ quiz to confirm your filing requirements.
Hobby vs. self-employment income
For tax filing purposes, you’ll need to distinguish yourself as either a self-employed streamer or a hobby streamer. You’re self-employed if you stream with the intention of making money. You’re a hobby streamer if you incidentally earn income while streaming.
Although the IRS provides guidelines to help you make the distinction, if you’ve monetized your Twitch account then there’s a good chance that you’re self-employed.
Self-employed individuals are business owners in the eyes of the IRS. As the owner of a streaming business, you’ll report your income on Schedule C of Form 1040 where you’ll take deductions to offset the income reported on your Forms 1099.
As a hobby streamer, you’ll report your streaming income on Schedule 1. You aren’t eligible to take deductions so the numbers reported on your Forms 1099 will be the amount on which you’ll pay taxes.
Self-employment tax for Twitch streamers
Self-employed streamers must pay self-employment tax in addition to income tax. Self-employment tax is your contribution to the Social Security and Medicare systems. By paying self-employment tax, you’re accumulating credits that will increase your monthly benefit when you eventually retire.
If you’ve worked at a job, you probably had Social Security and Medicare taxes (called “FICA”) deducted from your pay. These deductions equal 7.65% of your wages before deductions. Your employer would pay the other 7.65% on your behalf.
As a self-employed individual, you’re paying both the employer and employee portion of FICA. Your total self-employment tax therefore equals 15.3% of your streaming income after deductions, including a deduction for 50% of your-self employment tax.
Other income, such as from a job or investments, isn’t included in the self-employment tax calculation. Self-employment tax is based solely on your income from operating a business. Business income, however, is included in your total income for calculating income tax.
State taxes
In addition to federal taxes, which you’d pay to the Internal Revenue Service (“IRS”), your Twitch earnings may also be taxed by the tax authority for the state where you live.
Some states, such as Florida and Washington, don’t have an income tax. If you live in a state without an income tax, then you’ll only file a tax return with the IRS.
If your state does have an income tax, then you’ll file both federal and state tax returns. You’ll likely owe taxes to both the IRS and your resident state.
Taxes for minors streaming on Twitch
Minors who earn income on Twitch may be required to file a tax return. A minor’s filing requirements, and the amount of tax they’ll pay, depend on whether the minor is a hobby streamer or a self-employed streamer.
Minors who are “self-employed” streamers must file a tax return if their Twitch income is greater than or equal to $400. They would pay self-employment tax in addition to income tax. They would be eligible to take business deductions to offset their income.
Minors who are “hobby” streamers must file a 2023 tax return if their Twitch income exceeds $1,250. Hobbyists wouldn’t pay self-employment tax but would pay income tax. They wouldn’t be eligible to take deductions to offset their Twitch income.
Refer to the section above discussing self-employment vs hobby income for more info.
Filing taxes as a Twitch streamer
“Filing your taxes” simply means submitting a tax return (Form 1040) to the IRS and, if applicable, your resident state’s tax authority. You may or may not owe tax, depending on your income, deductions, and the amount of tax you paid during the year. You’ll settle your tax liability after filing a tax return by making a tax payment or receive a tax refund if you’ve overpaid.
When are tax returns due?
Here’s a general timeline of the tax filing process:
January 31st -
- Twitch mails your 1099s to you.
- You can also download the 1099s.
April 15th -
- File a tax return or an extension on or before this date.
- Tax payments are also due on or before this date.
October 15th -
- Your extended tax return is due on or before this date.
Gathering your tax information & documents
In January, Twitch will make your 1099 available for download or mail it to your home. Save this form, because it’s a critical piece of information for filing and paying your Twitch taxes.
(Looking for your Twitch tax forms? Here’s where you can find your Twitch Forms 1099).
Once you have your Twitch 1099s, review your bank and credit card statements to tally up your total streaming income and deductions for the year. Better yet - if you’ve maintained a spreadsheet or QuickBooks file with income and expenses throughout the year, this information will be ready to go.
Your tax forms from other sources such as investment accounts will gradually become available. Before filing your tax return, run through a checklist of all your income and deduction sources to confirm that you received a tax form from each. Missing info will result in an adjusted tax return and other undesirable IRS notices.
Preparing and filing your tax return
Your options for filing a tax return range from filing it yourself to hiring a tax preparer to file it for you. The best option is the one that accommodates your budget, your comfort with filing taxes, and the complexity of your personal tax situation.
Filling out and mailing a paper Form 1040 is the old school free-file method. However, most taxpayers now file their returns electronically. Tax filing software takes you through a series of questions and completes the tax return based on your responses.
My favorite tax prep software is either FreeTaxUSA or TurboTax. Both work equally well, but FreeTaxUSA is cheaper and you may even be able to file your federal return for free. The state tax return is usually an additional charge.
At some point you may consider hiring a CPA, EA, or other tax professional to prepare your tax returns.
Working with a CPA is similar to using tax prep software, except you’ve outsourced the difficult questions to someone else. A CPA will ask questions about your tax situation and request your Twitch 1099s and other tax forms. They’ll use this information, along with their professional expertise, to file your tax returns.
Paying taxes on Twitch income
Once you’ve filed your tax return, you’ll either make a tax payment or receive a tax refund.
You’ll make a tax payment if you didn’t pay enough tax during the year. You'll receive a refund if you paid too much tax during the year.
If you’re a self-employed streamer and you’re not employed elsewhere, you’ll likely only receive a refund if you made estimated tax payments during the year. If you didn’t make payments, you’ll likely owe taxes.
Your tax prep software or tax preparer will let you know the amount of tax you should pay. You can confirm the amount due for yourself by looking at lines 34 or 35a on your final Form 1040.
The best way to pay your taxes is electronically. If you’re using software to file your return, you should have the option to schedule a tax payment prior to filing your tax return. Likewise, your tax preparer can also schedule a payment on your behalf if you’ve instructed them to do so.
You may have forgotten to schedule your tax payment prior to filing, or you may prefer to delay your payment. In either case you can pay your tax liability by going to the IRS Direct Pay website. Select “Make a Payment” > “Balance Due” > “Income Tax - Form 1040” > select the tax year that corresponds to the tax year on the tax return you just filed.
Your state tax authority should also have an electronic payment website where you can pay your annual tax liability. Search for [YOUR STATE] + “pay taxes online” to find out.
What happens if you don’t file a tax return?
Assuming you’re required to file a tax return, you have until April 15th to file. You must also pay your tax liability before this date. Failing to do so may result in penalties and interest, which can be significant.
Filing an extension
It’s not always possible to file before the deadline. If you need more time, for any reason at all, you can extend the filing due date by submitting an extension request (Form 4868) to the IRS on or before April 15th. Your tax preparer or tax filing software should give you the option to file an extension, usually at no additional cost.
Keep in mind that filing an extension doesn’t extend the tax payment deadline. It only extends the tax return filing deadline. If you expect to owe taxes, you should make a payment to cover any taxes you expect to owe in addition to filing an extension on or before April 15th.
State due dates and rules on extensions vary by state. Consult the tax authority’s website of your resident state. For example, I live in Virginia so I’d look at this page for state tax information.
Additional tax tips for Twitch streamers
These easy-to-implement tax tips will make tax season less stressful.
Get organized
Good recordkeeping throughout the year will simplify tax season the following year. Having organized financial records is the number one way to ensure that you’re capturing all the deductions you’re entitled to take.
Without some kind of recordkeeping system in place, tax season will arrive and you’ll struggle to remember whether that $64.65 from Amazon on your credit card statement from 12 months ago was a business expense.
The best recordkeeping system is often the simplest one. Start small with a spreadsheet and make incremental improvements to your system as needed. At some point you may consider using accounting software such as Wave or QuickBooks Online.
Also, segregating your personal and business finances will provide a more efficient way to track your business deductions and income. For example, having a dedicated bank account for your Twitch payouts and streaming expenses will help you more quickly calculate your income and expenses during tax season.
Don’t forget about self-employment taxes
Self-employment taxes are equal to 15.3% of your business income. This tax is in addition to the regular income taxes you’ll pay on your business income. When estimating your taxes for the year, remember to factor in an additional amount for self-employment taxes. Otherwise you’ll fall short.
Save for taxes
Unlike things you buy from a store, it’s important to remember that taxes are an expense that you accrue as you earn income and for pay later. In other words, when you receive a payout from Twitch, don’t spend it all. Save some of it. Otherwise you may end up with a tax bill that you’re unable to pay for when filing your tax returns the following year.
A good rule of thumb is to set aside 33% of your Twitch payouts for taxes. Put the taxes in a savings account where they’ll earn interest until you’re ready to make a tax payment. This will help fund your tax liability as you earn income and generate additional interest income. The amount you don’t set aside for taxes is yours for personal expenses or for reinvesting into your streaming business.
Make quarterly estimated tax payments
Self-employed individuals, such as streamers earning income through Twitch, are required to make quarterly estimated tax payments if they will owe at least $1,000 when filing their tax return after subtracting tax credits and tax payments through withholding at another job.
Your total estimated tax payments and withholdings must equal to the lesser of 90% of this year’s tax or 100% of last year’s tax (110% if your “adjusted gross income” on last year’s tax return was greater than $150,000).
By making estimated tax payments, you’ll avoid underpayment penalties and interest. You’ll also avoid a situation where you have a large tax bill that you’re unable to pay because you spent the money you earned from Twitch already.
You may not need to make quarterly estimated tax payments if you earn income through a job in addition to your streaming income. Instead, you can have additional tax withheld from your paychecks by providing your employer with an updated Form W-4.
You can use the IRS’ Tax Withholding Estimator to calculate how much tax you should have withheld from each paycheck in consideration of your total expected income for the year, including your Twitch income.
You can make estimated tax payments by paying electronically through IRS Direct Pay. Select “Estimated Tax” as the reason and the applicable tax year. You can also pay by mailing a check using the appropriate voucher from Form 1040-ES.
Your state probably requires quarterly payments as well, assuming you live in a state with an income tax. Check their website for instructions on how and when to pay.
When are quarterly estimated taxes due?
Estimated tax payments are due based on this quarterly schedule:
- Q1 - April 15th
- Q2 - June 15th
- Q3 - September 15th
- Q4 - January 15th
Your state tax authority might have a different payment schedule so check their website to confirm.
Don’t stress if you missed one of the estimated tax due dates. You can still pay, but you may owe interest on the late payment. The interest will be calculated by the IRS when you file your tax return in the following year.
Need Help Filing Your Twitch Taxes?
I hope this guide was helpful. If you want help filing your taxes or just need advice, get in touch with through the contact form below. We help streamers file, pay, and plan for taxes. Maybe we can help you too?
Frequently Asked Questions (FAQs)
Is the Twitch Form 1099 the same thing as a tax return?
Form 1099 isn’t a tax return and receiving one doesn’t mean you filed a tax return. You should still file a tax return even if you received a 1099 from Twitch, unless you earned less than $400 across all streaming platforms.
Do streamers pay taxes on donations?
Yes, donations are taxable income. For Twitch streamers, the bits you receive through cheers are taxable income. Twitch will report the amount of donations you received on Form 1099-NEC. You’ll use this form to file a tax return and pay taxes on the income.
I received a Form 1099 from both PayPal and Twitch. Will I be taxed twice?
No, you won’t be taxed twice on income you earned through Twitch and received through PayPal. PayPal will issue you a 1099-K to report the payout. You can subtract duplicative income reported on Form 1099-K when filing your tax return. You can make the subtraction on Schedule 1 of Form 1040.
Do Twitch streamers need to file a tax return?
Not everyone is required to file a tax return. The IRS requires anyone who earned $13,850 ($27,700 if you’re married) or more during 2023 to file a tax return.
But, there’s an exception to this rule if you're making money as a streamer. If you earned $400 or more through Twitch or other streaming platforms, you’ll need to file a tax return even if your gross income was less than the thresholds above.
For example, suppose you began streaming in December 2023 and earned $1,000 before the year ended. Suppose you also earned $9,000 from a part-time job earlier in the year. In this case, although your total income was less than $12,950, you’d still be required to file a tax return since your income as a career streamer exceeded $400.
Plan to file a tax return if you earned more than $400 from streaming last year.
Does Twitch send you a W-2?
No, Twitch won’t send you a Form W-2 for taxes. Instead, you’ll receive either Form 1099-MISC or Form 1099-NEC or both. Similar to a W-2, you’ll use the 1099s to file your tax return.
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