I’ve updated the Twitch Income Calculator for 2018! This week we’ll cover what the tool is useful for as well as what it lacks.
The new tax law (which I’ll call TCJA in this article) added a lot of new, cool benefits for business owners. However, it also added a lot of complexity. Let’s dive in.
Stream Income Calculator
What it does
This tool is awesome for putting together a very rough estimate of what you’ll owe in taxes from your streaming business. It asks you to enter some numbers that you either should be able to pull from your dashboard or should be able to recreate pretty easily.
You can use that rough estimate to put together a savings plan to pay for your taxes or get a sense of what you could pull out of the business to support yourself. Knowledge is power, arm yourself.
What it doesn’t do
The TCJA introduced the concept of the Qualified Business Income (QBI) deduction. This is a deduction aimed to help pass through businesses get a reduction in their taxes. Check out this article for a longer discussion on pass through entities, but odds are that unless you’re a part of N3RDFUSION you are a pass through business.
Unfortunately, there were so many variables that could go in to the QBI deduction. There are different rules if you pay W2 wages to an employee, different rules based on your legal business entity, and on how you take your income from your business. Therefore, I would have had to have added too many variables to the calculator for it to be an easy to use tool.
Just know that once you’ve gotten the number from this calculator there’s also another potential deduction. This is something you should run via a CPA and if you need help finding one who knows Twitch let me know.
Conclusion
Use the tool! It’s only an estimator but it can be really helpful for getting a rough idea of what you need to save for taxes.
You don’t have to figure this out alone. This is what we do- help streamers make great money decisions. If that’s something that sounds interesting to you reach out me or schedule some time for a free consult. You can check out what I do here.
