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How do you handle taxes from affiliate income?

It seems like CCBill doesn't report affiliate income? Only normal sales if you are the owner? How do you guys report and handle the income on your taxes? I'm asking specifically about in the US.

I have no clue if you're doing business as an individual.

But you're not supposed to do business as an individual in adult. You're supposed to make an llc or s corp. In which case it follows all the same rules as any money you make running an llc or s corp.

Spoiler alert, yes you report your earnings and pay taxes on it.

I report the Affiliate Payouts as Advertising Expense. It lowers my overall tax liability, and I can show where the money went with reports from CCbill.

I would anticipate that Affiliates are receiving a 1099 from CCbill and are obligated to pay taxes on that income, so why should I pay it for them?

They don't send out a 1099 to affiliates it looks like.

See the last line.

Quote:

Beginning with the 2011 tax year, all payment providers based in the United States, including CCBill, are required to report transaction information to the IRS (Internal Revenue Service) about merchants who use CCBill's processing service to collect payment for goods and services sold.

IRS regulations (per IRC Section 6050W) stipulate that CCBill must now file Form 1099-K for all merchants that fit the following criteria:

U.S.-Based Company
Exceeds $20,000 Gross Processing Volume
Has more than 200 total transactions for any given tax year (2011 forward)

In an effort to help you understand these changes, we have put together the answers to several Frequently Asked Questions surrounding 1099-K compliance, collected here and linked below for your convenience.

At this time, 1099-K regulations do not apply to affiliates

Easy. Don't do em. XD