The potential shutdown of TikTok, the popular short-form video platform, has been a topic of much discussion and debate. A TikTok shutdown could significantly affect the platform’s millions of content creators who rely on TikTok as a primary source for income, their taxes, and audience engagement. With the threat of a shutdown looming, creators are left scrambling to understand how this could affect their financial stability, including how it might impact their taxes. A loss of revenue from TikTok could lead to changes in their income streams, affecting their overall financial health and their taxes.
With developments continuing to evolve quickly, creators and small business owners are understandably navigating a period of uncertainty. While the outcome remains to be seen, it’s a good time to reflect on financial preparedness and explore strategies to adapt to platform changes regardless of whether any occur with TikTok or any other platforms.
If you are a creator or small business TurboTax is here for you. We are here to answer questions like “How can I save money on my taxes?” Or “How can I protect my income streams if there is a shutdown?”
How can I protect my streams of income in the event of a social media platform shutdown?
- Diversify your revenue streams: You can explore new platforms and opportunities to maintain and possibly expand your income.
- Stay agile: Planning for and considering multiple revenue platforms as part of your long term strategy to earn income and increase engagement can help you stay flexible in times of uncertainty.
- Protect your income: Just as there are insurance policies that you can purchase to protect you if you are unable to work there are creator insurance policies which can protect you and your income in the event of a platform shut down. If you do have creator insurance, remember you can write off the cost of that insurance as a business expense since it is directly related to your influencer work. If you are paid by the insurance company in the event that you lose income due to a ban, that payment will be taxable if it is meant to replace income you would have earned.
- Protect your content: Download and save your content in case it is deleted from the app. You may be able to leverage previously posted content on other platforms.
Do I have to file my taxes if a social media platform I rely on for income is shutdown?
Yes, you still need to file your taxes by the tax deadline regardless whether or not the social media platform you use to make money is shutdown. If you don’t file you may get a failure-to-file penalty and a failure-to-pay penalty if you owe taxes.
How can I save money on my taxes?
The best steps you can take is to remember to claim all of the business expenses directly related to your business like travel, equipment, the home office deduction, and car expenses all of which can really lower your taxable income.
Don’t forget personal credits too like credits for your kids. The Child Tax Credit is up to $2,000 and the Child and Dependent Care Credit is up to $1,050 for one child and up to $2,100 for two or more.
If you made any energy efficient improvements to your home you can take a credit up to $1,200 for energy efficient windows and doors and up to $2,000 for heat pumps and biomass stoves. When you install solar panels you can get a credit up to 30% of the purchase price. If you purchased an electric vehicle in 2024 you may be able to take a credit up to $7,500 for a new electric vehicle and up to $4,000 for a used electric vehicle.
Check back with the TurboTax blog for more updates. At tax time, TurboTax can help you navigate any changes and your taxes as a creator with done-for-filing experiences whether you want to do your taxes yourself or have a TurboTax Live Full Service Tax Expert do them for you.