Affiliate marketing and taxes

Affiliate marketing and taxes: Affiliate marketing is a great way to earn money online. But, as with any business, it’s important to make sure you’re handling your taxes correctly. Unfortunately, taxes can be a boring and confusing topic, so we’ll do our best to make this post as entertaining as possible.

Affiliate marketing and taxes.

Affiliate marketing and taxes

What affiliate marketing is

First things first, let’s define what affiliate marketing is. Essentially, it’s a way for a company to promote their products or services through a network of individuals (affiliates) who earn a commission for each sale made through their unique referral link.


Now, onto the fun stuff: taxes. As an affiliate marketer, you’re considered self-employed, which means you’re responsible for reporting your income and paying self-employment taxes. But don’t worry, it’s not as scary as it sounds.

Tax ID number

The first thing you’ll need to do is obtain a Tax ID number (also known as an EIN) from the IRS. This is similar to a social security number, but for businesses. You can easily apply for one online and it’s completely free.

Keep track of all your income and expenses

Next, you’ll need to keep track of all your income and expenses. This includes any money you earn through affiliate marketing, as well as any expenses related to your business (such as website hosting fees or advertising costs). It’s important to keep accurate records and receipts, as these will be needed when it comes time to file your taxes.

Schedule C (Form 1040)

When it comes to filing your taxes, you’ll need to file a Schedule C (Form 1040) to report your business income and expenses. You’ll also need to file a Schedule SE (Form 1040) to report your self-employment taxes.

Multiple states

One important thing to note is that you may be required to file taxes in multiple states if your affiliate marketing business spans across state lines. So, be sure to check the rules and regulations in each state where you have made affiliate sales.


Now, let’s talk about deductions. As an affiliate marketer, you’re able to deduct certain expenses that are related to your business. This includes things like office expenses, advertising costs, and travel expenses. Just make sure that you keep all your receipts and records, as you’ll need them to back up your deductions.

Sales tax

Another thing to consider is that some states charge sales tax on affiliate sales, so you’ll need to check the rules in your state and make sure you’re collecting and remitting the correct amount.


In conclusion, while taxes may not be the most exciting aspect of affiliate marketing, it’s still important to handle them correctly in order to avoid any legal issues or penalties down the road. Just think of it as a small price to pay for the freedom and flexibility that comes with being your own boss. And remember, if all else fails, you can always hire a tax professional to help you navigate the world of taxes. Happy filing!

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