In 2001, Halo was first released. By 2015, when Halo 5: Guardians was released, fan interest was so intense that the game made $400 million in the first 24 hours.
Halo is a mainstay of e-sport tournaments. If you are a Halo e-sport athlete, you may have the potential to earn tens of thousands of dollars from your profession. You may benefit from being acquainted with the impact Halo esports athlete tax planning, bookkeeping, and accounting may have on the money you earn.
Halo Esports Athletes Tax Planning for Streaming Revenue
Ninja is a well-known name in Halo tournament circles. His streaming revenue is estimated to be in the millions. The money that Ninja and other e-sport athletes earn from streaming should be properly accounted for in their Halo esports athletes bookkeeping.
Money earned from streaming gets taxed similarly to the way money earned in tournaments may get taxed. For example, streaming companies like YouTube and Twitch may prepare a “1099” that can be used when filing your taxes.
Each platform has its own requirements. Some may include the money you might earn from tips and advertisements in the 1099 form you receive. Others may make you responsible for recording tips and donations you receive from your stream in your bookkeeping.
Although viewers may give you what they refer to as “donations” from a tax perspective, this money does not have the characteristics of a donation that would be tax-deductible. You or your Halo esports athlete CPA would likely record these “donations” as ordinary taxable income.
Lowering Your Tax Liability
You or your Halo esports athlete accountant may include business expense deductions as part of your tax planning. Here are some e-sports streaming related expenses your Halo esports athletes accountant might include the following:
1. Equipment Depreciation- cameras and computers for editing are some of the most expensive components of streaming. You may deduct the cost of this equipment over the space of five years as depreciation. This means that you might be able to deduct 20 percent of the value of equipment each year.
2. Advertising- If you create or promote videos on YouTube or other forms of advertising to get people to view your content, the expense in creating the advertisement and placing the ad might be a tax deduction. You may be able to deduct the cost of prizes from giveaways, such as gaming consoles, games, or other merchandise, as long as they are related to advertising.
3. Home Office Use- The IRS is more lenient with home office deductions. To deduct a home office space, use the space in a way that you can show that it is exclusively used for your streaming and gaming.
These are just a few deduction options. At Fusion CPA our FPS Halo esports athletes accountant may be able to help you find more deductions to minimize your tax liability.
Practical Guidance from Financial Advisers
Even if your streaming revenue has not reached the level of e-sports superstars like Ninja, you may benefit from practical guidance offered by financial advisers.
Here at Fusion CPA we provide Halo esports athletes with CFO business advisory services to help them make the best economic and financial decisions to help them reach their short and long term goals. We are well-versed in the unique financial planning and tax planning issues professional e-sports athletes face. We may help you minimize your federal, state, and international tax liability by providing insight on how things like your business structure, your home residence state, and your accounting can help minimize the amount you pay in taxes and maximize the money you keep in your pocket. Would you like to learn more about how FPS Halo esports athletes CFO business advisory can help you? If so, we are here to help. You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.