Google adsense just like any other job requires you to pay tax on your earnings. To everyone out there that is makes more than $600 dollars on google adsense you've probably received the 1099-MISC form outlining how much money you made after the end of each year. And even more if you checked the "Exempt from backup withholding" 28% percent of your google adsense earnings will be kept by google and go towards your taxes. This basically applies to people who have gotten in trouble with the IRS for example lying about your social security number. As more and more people realize that google adsense is a legit job we are learning more about google adsense taxes. Like deductions and even how to net your google adsense earnings to your other earnings. For example if you had another job you might add your google adsense earnings to that job's earnings. Therefore saving yourself self on some taxes. It's a useful technique that people use on other businesses. Another important fact is you need to realize which your google adsense earnings fit under: a hobby or a business. Most google adsense savvy users who earned a lot of cash on it decide to make it a business. This helps them use any expenses on advertising their website and domain or hosting costs as business deductions. While most small time users decide to make it a hobby which greatly reduces your taxes on it. The IRS has an article that can help you with this located at: Business OR Hobby? Please keep in mind that just because you think you make enough money to declare your google adsense earnings business earnings doesn't mean you can. As the IRS promptly tells us that to tax your a business you need to have a certain structure. Meaning you need to have employees which ends up being only you (official term sole proprietorship). Loans and costs and all of those official things that go with businesses, so you can't just declare yourself a business overnight. Now on to the more interesting part of how you can deduct a lot of money from your google adsense earnings taxes. Things like your domain and hosting costs as well as physical purchases like a new computer or even a mouse. But these tax deductions change everyday so I suggest you get in touch with a tax professional or use one of those new tax programs to find out all of the opportunities on there. As well as how much you can deduct from each. Google happens to have a tax information page itself though not very up to date: Google Adsense Tax Info Also I suggest you check out the IRS.gov website for more information on taxes. Thank You |
