Google AdSense & YouTube Publisher Tax Guide

When you have Google AdSense ads on your blog or website, your earnings are considered business income. Read this post to learn how to file your Google AdSense taxes and what you’re going to owe.

Are earnings from Google AdSense taxable?

Yes, income from any source is taxable under the Internal Revenue Code. This includes your revenue from Google AdSense or any other online advertising platforms you use to monetize your website.

How are Google AdSense earnings taxed?

Your ad revenue is business income. Even if your website is small, you’re still in the business of selling paid advertisements.

You’ll owe income tax, self-employment tax, and Medicare tax on Google AdSense earnings depending on your total income and tax bracket.

Does Google AdSense send a 1099?

Yes, you will receive a 1099 from Google AdSense if you earn $600 or more in a year. They will also send a copy to the Internal Revenue Service.

Your 1099-NEC will come from XXVI Holdings Inc. This is a holding company Google uses to operate AdSense. The business address is 1600 Amphitheater Parkway, Mountain View, CA, 94043. The Payer’s TIN is 82-2182297.

Keep in mind that earning less and not receiving a 1099 does not exempt you from taxes. If you’re required to file a tax return, you must report every dollar of AdSense income you earned.

Note that Google will not send you a payment until you provide your tax information. This is explained when you open your account.

How do AdSense taxes work for international publishers with Forms W-8 BEN and 1042-S?

As a U.S.-based company, AdSense is required to collect Form W-8 BEN or similar tax information from foreign publishers. U.S. tax law imposes a flat tax rate of 30% on income foreign nationals earn from U.S. sources. If your country has a tax treaty with the United States, your tax rate may be lower.

Does AdSense withhold taxes for foreign publishers?

AdSense automatically withholds U.S. taxes from your earnings if you’re a foreign publisher. Your actual tax obligation may be lower if:

  • AdSense did not automatically account for a tax treaty that lowers your tax rate from 30%, or
  • You have business expenses that reduce your net profit.

Do foreign publishers get a Form 1042-S from AdSense?

You will receive a Form 1042-S from AdSense each year in February or March. This form shows how much you earned in total and how much AdSense withheld in U.S. taxes.

Can foreign publishers get a tax refund?

You can receive a refund of any excess tax by filing a U.S. tax return form 1040-NR. Form 1040-NR is due by April 15th for income earned during the previous calendar year.

What if you’re a YouTube Creator?

If you’re a YouTube creator, the ads on your videos are part of AdSense. You may also receive a revenue share from YouTube premium.

If you’ve already provided your tax information in your AdSense account, Google will use that. If you haven’t provided tax information, Google will collect the IRS required withholding tax on your YouTube earnings. The withholding rate is 24% for individual account types and 30% for business account types.

If you’re a YouTube content creator who lives in another country and is a non U.S. citizen, the taxes you pay and any tax withholding depend on whether your country has a tax treaty with the United States. You can expect a withholding rate of 0 to 30%. Whether or not you fall under a tax treaty, your country may require you to pay its own income taxes on your earnings.

Who actually pays you?

Both Google AdSense and the YouTube Partner Program are part of Google LLC. Your 1099 and payments will likely be listed as from Google LLC instead of AdSense or YouTube.

Do I have to give Google my Social Security Number?

You must provide Google with tax information to participate in the AdSense program. You can use an Employer Identification Number instead of a Social Security Number if you have one. An EIN is a tax identification number for businesses that works similarly to SSNs. If you use an EIN as a sole proprietor, you’ll receive a 1099 under your EIN but still file a single tax return.

What tax form do I use to report taxes on earnings from AdSense?

When you file your tax return, you’ll need to include your earnings on a Schedule C. Schedule C attaches to your Form 1040 and reports business earnings. If you have business expenses, such as web hosting, you can deduct those on your same Schedule C. Therefore, you’ll only be taxed on your profits instead of your total ad revenue.

Does Google take out withholding tax?

If you’re in the United States, Google will generally place your payments on hold until you submit your tax info. They may also place your payment on hold if they believe your tax info is missing or incorrect. You can manage tax info in your AdSense account by clicking Payments, Manage Settings, and editing your Payments Profile.

Google does not withhold taxes under normal circumstances. If you’re used to having an employer deducting taxes, this can get you into trouble at tax time. If you owe more than $1,000 when you file your tax return, you could have to pay an estimated tax penalty.

You can avoid the estimated tax penalty by doing one of the following:

  • Making sure you don’t owe more than $1,000 in taxes. Your AdSense earnings might not be that much, or you might increase your withholding at your day job.
  • Paying quarterly estimated taxes based on your current year income.
  • Paying quarterly estimated taxes based on your prior year income.
Based on Current Year Tax ReturnBased on Prior Year Tax Return
AGI up to $150,000 ($75,000 if married filing separate)90% of current year taxes100% of prior year taxes
AGI over $150,000 ($75,000 if married filing separate)100% of current year taxes110% of prior year taxes
To avoid the estimated tax penalty, you must pay one of the above percentages through a combination of estimated tax payments and withholding. Typically, you need to make four equal payments. If you have uneven income, you can use the annualized income installment method.

Your quarterly taxes should generally be four equal payments. This assumes that you earn your income evenly throughout the year. If your income is seasonal, you can use the annualized income installment method to pay less taxes when you earn less income.

Here’s the usual schedule of when to make payments.

Action Needed2021 Tax Year2022 Tax Year
First Quarter Estimated Tax Payment DueApril 15, 2021April 15, 2022
Second Quarter Estimated Tax Payment DueJune 15, 2021June 15, 2022
Third Quarter Estimated Tax Payment DueSeptember 15, 2021September 15, 2022
Fourth Quarter Estimated Tax Payment DueJanuary 15, 2022*January 15, 2023*
Receive Your 1099No later than January 31, 2022No later than January 31, 2023
File Your Tax ReturnMonday April 18, 2022 (due to Good Friday and Passover on the 15th)Tuesday April 18, 2023 (15th is a Saturday; Monday is Washington, D.C., Emancipation Day)
Extended Filing DeadlineMonday October 17, 2022 (15th is a Saturday)Monday October 16, 2023 (15th is a Sunday)
*You can skip the final estimated tax payment if you file your tax return and pay your full balance due by February 1st.

When do you have to file a tax return?

Generally, you must file a tax return if your business income is $400 or more. This includes your total earnings from all sources not just Google AdSense income.

The tax law may require you to file a tax return in other situations such as the following:

  • You want to claim a tax refund
  • Your total taxable income is above the standard deduction amount
  • You received an advance of the Premium Tax Credit.

Your AdSense taxes are part of your normal tax return and subject to your normal tax rate. If you’re signed up as an individual, you’ll report them on your Form 1040 due in April. If you have an AdSense account as a non-sole proprietorship business, you’ll include the income on your business tax return. Business tax return deadlines vary.

 

Disclaimer: This post is provided for general information only. The information may be outdated or may not fully cover the unique circumstances of your specific situation. Always consult with an appropriate professional before making important decisions.

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