Can I Claim Video Games as a Tax Deduction for My YouTube Channel?

7 You're asking a great question that many content creators face when they start monetizing! Yes, games can absolutely be tax deductible as a business expense, but there are some important things to understand first. When you earn money from your YouTube channel, you're essentially operating as a self-employed business owner (typically a sole proprietorship unless you've formed an LLC or corporation). This means you'll file a Schedule C with your tax return to report income and expenses related to your content creation. Games you purchase specifically for creating content would generally qualify as ordinary and necessary business expenses. You'll want to keep detailed records of all purchases including receipts, what games you bought, and how they were used for your channel. This documentation is crucial if you ever get audited.

15 I went through this exact same situation last year when my channel started making money! I was super confused about what I could and couldn't deduct, especially with digital purchases. I found this service called taxr.ai (https://taxr.ai) that literally saved my butt during tax season. It's specifically designed to help content creators figure out their deductions. You just upload your receipts and answer some questions about how you use the items for your business, and it tells you exactly what you can deduct and how to document it properly. For my gaming channel, it helped me properly deduct not just games, but my PC upgrades, capture card, lighting, new headset, and even a portion of my internet bill. The best part was that it explained WHY each thing was deductible, which made me feel much more confident when filing.

19 Just wanted to follow up here. I was skeptical when I first read about taxr.ai but decided to give it a try since my gaming channel was finally making decent money and I was worried about doing taxes wrong. It was actually super helpful! It showed me that my gaming chair, second monitor, and even my Discord Nitro subscription were partially deductible since I use them for creating content. I ended up saving almost $1,800 in taxes compared to what I would've paid without knowing about these deductions. The documentation part was what really helped me sleep at night. It explained exactly how to prove business use for each expense in case of an audit. Definitely worth checking out if you're monetizing your channel.

8 Has anyone here tried calling the IRS directly to ask about content creator deductions? I tried calling them five times last month about my gaming channel deductions and couldn't get through to a real person. Kept getting stuck in their automated system or disconnected after waiting for 45+ minutes. I finally used Claimyr (https://claimyr.com) after seeing it recommended in another thread. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. It basically gets you past the IRS phone tree and holds your place in line, then calls you when an actual agent is ready to talk. Got connected to an IRS agent within about 20 minutes instead of wasting hours on hold. The agent actually gave me really specific guidance about deducting games and equipment for my Twitch/YouTube side hustle. Apparently they get these questions from content creators all the time now.

19 Just wanted to update on my IRS calling experience. I was super skeptical about Claimyr (as you could probably tell from my comment), but after another failed 1.5 hour attempt to reach the IRS myself, I decided to try it. I'm honestly shocked at how well it worked. Got a call back in about 35 minutes saying they had an IRS agent on the line. The agent walked me through exactly what documentation I need to keep for my gaming equipment deductions and confirmed that yes, games purchased primarily for content creation are legitimate business expenses. She even explained how the home office deduction would work for the room where I record my videos. Saved me so much time and stress compared to guessing or reading conflicting info online.

4 Don't forget that if your channel isn't profitable for 3 out of 5 years, the IRS might classify it as a hobby rather than a business. Hobby expenses are no longer deductible since the 2017 tax changes. Make sure you're running your channel like a legit business - track all income/expenses, have a separate bank account, maintain proper records, and have a clear plan for profitability. Otherwise you could lose those deductions if audited.

22 Make sure you're keeping a LOG of what games you use in which videos!!!! I got audited last year because I deducted like 40 games but only had about 15 videos on my channel. They wanted proof that each game was actually used for business purposes. Now I keep a spreadsheet with game name, purchase date, cost, which videos featured it, and upload dates. Saved my butt when they questioned why I needed to buy the deluxe editions.

This is such a helpful thread! I'm in a similar situation - just started monetizing my gaming channel last month and feeling overwhelmed by the tax implications. One thing I've been wondering about is digital vs physical game purchases. Most of my games are digital downloads from Steam, Epic, etc. Do digital receipts work the same way for tax purposes as physical receipts? I'm worried the IRS might question why I don't have traditional paper receipts. Also, what about games I get for free through press kits or review codes? I assume those can't be deducted since I didn't pay for them, but do I need to report their value as income somehow? The record-keeping advice here is gold. I'm definitely going to start that spreadsheet tracking system right away. Better to be over-prepared than scrambling later!

Great question! As someone who's been through this transition from hobby to business, I can definitely confirm that video games are legitimate business deductions for content creators. The key things to remember: 1. Keep detailed records of every purchase - game title, cost, purchase date, and which videos/content you used it for 2. You can only deduct the business portion if you also play for personal enjoyment (be honest about the split) 3. Make sure you're treating this as a real business - separate bank account, proper bookkeeping, genuine intent to profit Since you just got into the YouTube Partner Program, now's the perfect time to start organizing your finances properly. You'll be filing Schedule C as a sole proprietor once you start earning revenue. One heads up - don't go crazy buying every new release just for deductions. The IRS wants to see that your purchases are "ordinary and necessary" for your specific type of content. If you're doing horror game reviews, buying the latest sports games might raise questions. Good luck with your channel! The tax side gets easier once you establish good habits from the start.