Question for anyone who's dealt with this before - does having streaming income (even if it's a loss) affect my eligibility for any tax credits? I'm worried about losing my earned income credit since I hear self-employment income can change things.

This is a great discussion! I'm dealing with something similar but with YouTube AdSense revenue. I got a 1099-NEC (not MISC) for about $1,200 from YouTube, and I'm wondering if the same Schedule E vs Schedule C rules apply? My understanding is that 1099-NEC income typically goes on Schedule C and is subject to self-employment tax, unlike the 1099-MISC royalties you're dealing with. But I'm also just doing this as a hobby alongside my regular job, so I'm not sure if the "hobby vs business" distinction matters for tax purposes. Has anyone here dealt with YouTube income specifically, or know if there's a different treatment compared to Twitch royalties?

Do high income celebrities ever leave California to move to states with no income tax? If I was paying millions in state taxes alone, I'd seriously consider moving to Texas or Florida.

This is a fascinating discussion! As someone who works in tax preparation, I can confirm that celebrities like Tom Hanks face incredibly complex tax situations. One aspect that hasn't been mentioned yet is the Alternative Minimum Tax (AMT), which often kicks in for high earners and can actually increase their effective tax rate even further. Also, don't forget about self-employment taxes! If Tom Hanks is operating through a loan-out corporation as mentioned earlier, he might avoid some SE taxes, but if he's treated as self-employed, that's an additional 15.3% on the first $160,200 of income (for 2023). The timing of income recognition is huge too - many actors negotiate to defer portions of their compensation to future years when they might be in lower tax brackets or have moved to more tax-friendly states. It's really a chess game between their financial advisors and the tax code!

Could this be from some class action settlement you were part of? I got a random 1099 last year and it turned out I was included in some lawsuit against a company I used years ago. Never even knew about it until the tax form showed up!

I'd definitely start by checking your credit report for any accounts you don't recognize, but also look through old paperwork or emails from previous employers. Sometimes companies will automatically enroll employees in small life insurance policies or retirement savings programs that you might not remember signing up for. Another thing to check - do you have any family members who might have opened an account on your behalf years ago? Parents sometimes set up small savings or insurance policies for their kids that mature later. The $390 amount is pretty typical for something like a small whole life insurance policy cash value or a forgotten 401k rollover. When you call Nationwide, ask them specifically what type of account it was (401k, IRA, insurance contract, etc.) and when it was opened. They should be able to tell you the original source even if you don't remember it. Don't panic about identity theft until you rule out these more common explanations first.

Should I make an LLC for selling feet pics? Someone told me it protects me better tax-wise but idk if thats true or worth the hassle for a side gig that makes like $800/month.

Great advice in this thread! One thing I'd add - make sure you're keeping detailed records of ALL your income, not just what shows up on payment apps. I learned this lesson with my freelance work when the IRS asked for documentation during a review. Keep screenshots of payments, transaction histories, and any correspondence with buyers. Also, don't forget about potential business expenses! If you're buying props, lighting, or even specific nail polish/pedicures for your photos, those could be legitimate deductions. The key is that they have to be ordinary and necessary for your business. I'd recommend consulting with a tax professional at least once to make sure you're maximizing your deductions while staying compliant - it's usually worth the cost when you're dealing with self-employment income for the first time. Good luck with your business!

Don't waste your money on TurboTax Deluxe! You can file with the Retirement Savings Credit for FREE using FreeTaxUSA or the IRS Free File program. TurboTax intentionally locks these credits behind paywalls even though other services include them in their free versions.

This is such a common misconception! I went through the exact same confusion last year. The key thing to understand is that "non-refundable" doesn't mean it can't increase your refund - it just means the credit itself can't go below zero. Think of it this way: you've already paid taxes through payroll withholding all year. The Retirement Savings Credit reduces your actual tax liability, which means more of what you already paid gets returned to you as a refund. I'd definitely pay the $54 for TurboTax Deluxe if that's the route you're going, but as others mentioned, you might want to check if FreeTaxUSA or other free services can handle this credit without the upgrade fee. The credit calculation itself is legitimate though - you're not being scammed!