US streamers may soon be making more money after tax changes
New tax changes coming into the effect in the United States are being noted primarily for their effect on restaurant staff and related workers, but US streamers may also be making more money thanks to new tax write-offs included in a “no tax for tips” bill.
The streaming industry has boomed and become a massively successful business opportunity for many. New content creators join each day in the pursuit of potentially high earnings. American streamers may soon be able to earn even more money thanks to the new “no tax on tips” bill that will allow them to get tax write-offs for income that would include money made from digital donations. This tax benefit may potentially help the streaming industry overall, and most specifically smaller and newer content creators trying to break in.
Will all streamers benefit from the US “no tax for tips” bill?
The new tax changes in the “no tax for tips” bill are specifically aimed at smaller content creators and streamers, as those who make more than $150,000 in cumulative annual income won’t be able to take advantage of the included tax breaks.
The new bill strives to even the playing field for workers in sectors that “customarily and regularly” receive tips. A US Treasury spokesperson confirmed that online influencers are included in this category of workers. The term “influencer” was broadly defined, but included those who make money from livestreams, which very specifically would cover all streamers on Twitch, Kick, YouTube, and other, similar platforms.
While streamers don’t tips in the traditional sense that most would be accustomed to, many fans of streamers will send direction donations or transfer over virtual forms of currency, such as Twitch bits, to content creators. These donations are essentially tips being provided to the streamer, and per the established definition, these donations would fall under the newly-established tax-exempt status.
American content creators can claim a deductible of up to $25,000 worth of income from these earnings on their taxes. Streamers who earn primarily from brand deals and advertisements won’t be able to write off those earnings, as those won’t fall under the definition of “tips.” As the new law also takes into account overall earnings, major content creators making millions of dollars, or even hundreds of thousands, won’t be able to access these tax breaks.
US steamers will potentially be able to make more money via this new bill as early as at the conclusion of 2025. Content creators can record their tips received in 2025 and have them deducted from their 2026 tax returns. The policy isn’t yet permanent and is currently scheduled to end in 2028. Should it prove popular and should those in congress remain favorable to it, the new rule could be extended or even codified into permanent law at a later date.
Khizar Mundia has been playing video games for as long as he can recall. Things have come a long way since the many days he spent playing the original NES, though. He now covers a variety of competitive games and esports, as well as the world of streaming, ranging from Twitch to Kick. If it’s of interest to gamers, it’s of interest to Khizar.
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