Social Media Influencers have become a common form of advertising. Clocking in at a whopping $24 billion in estimated worldwide market size (Statista Feb.6, 2024), the industry has boomed from just $8 billion in 2019. In 2023, approximately 75% of US companies used influencers to market their products.

Reportable Income

Are you recording all your reportable income? There needs to be order when it comes to all the ins and outs of your business. Most importantly, the money that is coming in from your influencer marketing needs to be recorded, there are many different streams of income in this industry. The majority of these streams of income should produce a 1099-NEC from the vendor, but if they don’t you still need to have complete and accurate records of what your business earned during the calendar year.

  • Product Sponsored Posts
  • Brand Partnerships
  • Advertisements.
  • Receipts of Products

Bookkeeping Income

A great way to track all of your income and expenses would be with QuickBooks Online (QBO), a full-service online accounting system. ICG provides QBO set-up services and offers discount subscriptions. 

Below are some examples of items that you should always keep track of within any accounting platform that you use:

  • Appearance-related costs
  • Travel
  • Meals & Entertainment
  • Staging & Equipment/Technology
  • Supplies & Materials

Tax Implications

The majority of services that you perform as a Social Media Influencer will bring income in the form of a 1099-NEC, as you are an independent contractor hired by larger brands to promote their products. This means you will normally not have any taxes withheld from your payments, thus leaving a tax liability when you file. At ICG, we will set you up with a tax plan to help avoid any penalties and interest resulting from this.

As a social media influencer, a decision will be needed regarding how to file your taxes in the most beneficial way. ICG can guide you through the different reporting and filing options that will result in the most tax-efficient approach for you and your business.

As the social media influencer landscape continues to grow, understanding your tax obligations is crucial to maximizing your earnings and protecting your business. If you need assistance with tax planning or have questions about managing your influencer income, contact our office at 203-489-0612 to speak with one of our experienced CPAs

Written By: Nicholas Mangone

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