OnlyFans Taxes: Step by Step Guide on How and What to Pay

January 2, 2023 in How To

Hey, are you looking for how to pay OnlyFans Taxes, then you are at right place.

OnlyFans is a popular platform for content creation. Moreover, if you are making a good amount of money from OnlyFans then ensure that you are fulfilling all the conditions related to taxes. Moreover, there are so many ways to pay taxes. In this blog, we have mentioned all the details related to OnlyFans taxation.

OnlyFans emerged as a good platform where you can earn money with your content. Moreover, you can earn money from subscribers or by directly selling content to your followers. But to earn without any problem it is essential to pay taxes. Go through this blog and you will get an idea about OnlyFans taxes. 

The taxation system is complex and it takes time to understand the process. However, in this blog, we have explained all the details in easy language. Once you will go through this blog you will get all the knowledge about OnlyFans taxation. Moreover the taxation system updates over time which is why it is essential for you to keep yourself updated with all the latest events and tax slabs. 

OnlyFans Taxes: Step by Step Guide on How and What to Pay

Steps on how to file OnlyFans Taxes

Below we have mentioned steps that you have to follow to file OnlyFans taxes. You will get a form that you have to fill out. 

  • In the first line, you have to add your full name however if you are operating your business as an LLC then add your firm name in the second line. If you do not have a firm then leave line 2 blank.
  • Now get on the serial number 3. You will get to see columns that state that Individual, single proprietor, or single LLC member. If you won't have any firm then tick on the first option. 
  • Serial number 4 is about a deduction that you can skip. 
  • In the fifth line, you have to provide a mailing address.

If your annual earning is more than $600 then you have to follow different steps that we have mentioned below. 

If you have reached this figure then you should fix your tax return. Moreover, schedule C is the most important schedule which is also called profit or loss from business. On this schedule, you have to show all your profits and losses in the business along with business deductions related to this business. 

Furthermore at the end of the year so many content creators use this schedule C form which shows profit or loss from a business and this has to submit to the IRS with their form 1040 tax return. 

You don't have to go through accounting because this form contains all the accounting to the date consequently your net income will be visible in the top section of the form and your income will be visible in the middle section of the form. You have to pay income tax and self-employment tax based on the amount shown in the Schedule C form. 

Different types of taxes as per career:

There are so many types of content creators on the platform. However, depending on your career you have to pay taxes on this platform. In the below section we have mentioned the types of taxes that you have to pay as per career. 

1. Tax to be paid if you are an OnlyFans Hobbyist

We all know that OnlyFans is one of the biggest content creation platforms. Moreover, people are earning a good amount of money out of it. Furthermore, this platform is used by popular celebrities and content creators around the world. Some people made this platform the primary source of earnings. If you are also using this platform to create content and earn money then it is important to know about taxes. However, there are some people who use this platform as a hobby. 

If you are also creating content on this platform as a hobby and getting some money from this platform. Then it is essential to know where to add these earnings while filing taxes. Moreover from 2018, the ability to itemize expenses for activities related to hobbies was suspended by the IRS. This means that you do not have to pay taxes on the income made by your hobby. 

This will be great for you if you are earning from this platform but not as a professional. Moreover, any income made on the OnlyFans is taxable and you have to file it on the taxable earning section of form 1040. Furthermore, if you are earning more than $600 then that brand must send you 1099. As a hobbyist, you do not have to worry about your taxes. 

2. Tax to be paid if you are an OnlyFans Careerist 

Some people use this platform as a hobbyist and some as a careerist. If you are using this platform as a careerist then it is essential to know about the tax to be paid. Moreover, as a career influencer, you have to pay both income tax and self-employment tax.  Furthermore, the self-employment tax is 15.3% this year. Furthermore, as a business, you have to pay both social security tax and medicare tax. 

The social security tax is 6.2% for both employer and employee. However, the Medicare tax is 1.42% for both employer and employee. If you add this together you will have to pay 12.4% for social security and 2.9% for Medicare tax. Furthermore, the best thing that will be helpful for you is that your self-employment tax is based on your net earnings which means that you do not have to pay as much tax as you are thinking. 

Along with social security and medicare tax, you have to pay income tax however this income tax will be based on the income that you have made this year. Moreover, income tax depends on the amount of money you made from this platform. However, this is not like a self-employment tax. 

Tax deductions that can help to reduce your OnlyFans taxes 

If you are worried about paying so much as a tax then don't worry. There are some ways through which you can reduce your OnlyFans taxes. 

1. Self-employment tax deductions

As your earnings increase the OnlyFans tax also increases but there are some ways through which you can save your money and reduce taxes. One of the ways is self-employment tax. It means that the employer portion of the tax will be included in the business expenses.

Moreover, you can deduct it according to you. Furthermore, according to the IRS, you do not have to pay Medicare taxes and social security if you are earning less than $400 as a self-employment income. Moreover, if you are using an OnlyFans account as a hobby then you don't have to pay self-employment tax. 

2. Clothing or camera equipment

You do not have to pay taxes for the amount required for the clothing or camera equipment. In this way also you can reduce your taxes. Moreover, there are certain conditions you need to follow. The clothing needs to be of industry standards moreover you should not use that clothes outside your work.

Furthermore, you can also reduce taxes by using high-quality camera equipment. 

3. Transaction fees

You will get a tax deduction on transaction fees. You do not have to pay tax on the money you are paying as a transaction fee. And reduce your income tax on OnlyFans. 

4. Health Insurance premium

If you are self-employed and you pay for your health insurance premiums. Moreover, if you do not fit the eligibility criteria of your spouse's employer then you do not have to pay taxes on the amount of your health insurance. 

5. Internet and Phone Bill

While doing a business you need an internet and phone bill. So you do not have to pay tax on the money that you will use to buy these services. However, this will reduce your taxes. As a content creator, the internet is an essential part of your business. 

6. Meals

You do not have to pay a tax on the amount spent on meals. The meal is a tax-deductible business expense when you are traveling for a business meeting or conference. Moreover, only 50% would be deducted. The meal should not be lavish or extravagant. 

7. Vehicle use

While traveling to another city or in your city you have to use a vehicle. So you do not have to pay taxes for the amount of vehicle use. The use of vehicles can reduce your tax burden. 

8. Travel

You may have to travel for business-related purposes. It might be meeting with new clients, or finding a new customer. For such activity you do not have to pay taxes, however traveling to meet a friend is not a business trip so in the end, you should know what falls in your business travel. 

9. Charitable events 

If you are doing charitable events then you also don't have to pay tax on that amount. However, there are so many celebrities who perform in a charitable event or perform in an event to crowdfund a certain cause. 

How does Federal Tax for Influencers work? 

While learning about federal taxes you need to understand two things. First is you have to make your deductions and then you have to add taxes in a stairstep method. Moreover, you have to add up all your business expenses then only you can deduct them from your total earnings and the remaining amount will be your taxable amount. You can show this in your tax forms. 

Let's suppose you have earned  $100,000 you do not have to pay 24% of income tax on your entire amount. However $9875 that you have earned first will be taxed at 10% moreover the profit between $9875 and $40125 will be taxed at 12%. The income that is over $85,526 will be taxed at 24%. 

Moreover, the income tax bracket changes from time to time which is why you should keep yourself updated. 

What other things are to be considered? 

  1. Business license

The business license depends on what state you are living in. However more than the location it also depends on the factor that how much you are earning from the OnlyFans. If you are a beginner then you don't need to have a business license. But if you are making a good amount of money on OnlyFans then it is important to have a business license. 

  1. Local and State tax

Indeed, apart from federal taxes, you have to pay local and state taxes. However, if you are living in an area where you don't have to pay local taxes then it is pretty good. There are some places like Nevada and Texas where you don't have to pay local taxes. 

  1. Sales Tax

There is no need to pay sales tax to every OnlyFans content creator. You need to pay this tax only when you have a merch store or POD set up along with your OF setup. Apart from this you don't have to pay sales tax.

  1. Penalties

If you are making a good amount of money from OnlyFans then it is essential for you to hire a person who will handle all your accounts. So that you don't miss any tax and should not pay penalties. 

Conclusion:

OnlyFans has so much potential, moreover so many people are earning a good amount of money from this platform. You can also use this platform to create content and can earn a good amount of money. But while earning money make sure that you are accurately paying your taxes.

However, taxation is so confusing and it is also hard to understand. But still, we have mentioned all the details about the tax that you have paid on the income made by the OnlyFans. Make sure that you are following the proper steps. However, also keep yourself updated with the latest changes in the taxation and tax brackets.

About the author 

mattswindlers

Matt Swindler is a successful businessman who owns an OnlyFans agency. Matt's agency helps individuals and businesses create and manage their OnlyFans accounts. This involves providing support in areas such as content creation, marketing, and technical issues. Matt has extensive experience in the industry and has helped many people achieve success on the platform. KinkyCreators is an authority site focusing on finding the top onlyfans creators and also helping them educate on how to make more money from the platform.

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