DOOMSDAY πŸ’€ The 24% TAX on YouTube Creators Has Begun… (Here is what YOU need to DO)

– [Sean] Imagine you're earning
$1,000 a month on YouTube from the YouTube Partner
Program, ads, superchats, maybe even channel memberships, and $240 of those dollars just disappeared after all of your hard work. Well, that's what can happen if you don't update your tax
information by May 31st, 2021. So it literally is Tax Doom Day, especially for those outside of the US, but I'm going to share all the information you need in this video
to keep yourself safe, keep as much money in
your pocket as possible, and really avoid this YouTube tax, which isn't really a YouTube tax. It's actually really the US government, the Internal Revenue Service, the IRS. But we're gonna cover all
the details in this video, so smash like if you're fired up. If you haven't heard, all
monetizing creators on YouTube, regardless of their location in the world, are required to provide tax info.

It's not new information, but you need to submit your
tax info as soon as possible, if you're just seeing this
and you haven't updated it. If you're in the US, check to make sure your
tax info is current. If you're outside of the US, definitely make sure you
maybe submit some information inside of your Google AdSense account, so that you're safe, and
the deadline is May 31st. Otherwise, Google could
be required to deduct 24% of your total earnings worldwide. To get the exact information
that you're gonna need to know, we're actually gonna check out
this information from YouTube and I wanted to get this video to you because it's happening literally
as I'm recording this live.

You have basically right
now, like, two days, until then absolute deadline of this, or else your money could
start being withheld, and then at the end of this
video, in super short video, I'm gonna share three tips
that are actually bigger than just this piece of information, so that you can make more money, and make a greater impact
on YouTube that I've learned from making a lot of
mistakes over the last decade as a business owner, and not
just as a YouTube Creator.

Let's check this out. – [Man On Video] In this video, we'll walk you through
important tax changes that may soon impact monetizing creators outside of the United States. We know that tax information
can be overwhelming, so we're gonna walk you through
everything you need to know about what's changing, and
the steps you need to take. – [Sean] So this is from the
YouTube Creators channel, so you're gonna get all the
information on how to set up, how to go into AdSense,
what you need to change. Here you go. – [Man On Video] And be sure to check out the links in the description
for even more detail. Let's dive in. First, what's happening? If you're a Creator outside of the US, you may begin to have taxes
deducted from your US earnings later this year.

Google has a responsibility
under Chapter three of the US Internal Revenue
Code to collect tax information from all monetizing
creators outside of the US, and in certain instances, to deduct taxes when
these creators earn income from viewers in the US. These US earnings can come
from ad views, YouTube Premium, superchat, super stickers
and channel memberships. – [Sean] So basically too, all the money that is generated
by YouTube, and later on, we're gonna talk about
diversifying your income stream. Everything that you generate on YouTube, including superchat, channel memberships. In addition to the fact
that YouTube takes 30% of every single superchat,
and gives you 70, takes 30% of channel
memberships, and gives you 70, you also could be hit with another 24% if you don't update
this outside of the US, and if your information's
incomplete here in the US from all of the revenue generated underneath the YouTube umbrella.

Again, if you're doing affiliate
marketing, or a brand deal, that's still subject to taxes,
but that would be separate, and it's not gonna be… There's not gonna be a forced withholding that they're talking about here. – [Man On Video] So what
does this mean for you? Over the next few weeks, you'll be asked to submit your
tax information in AdSense. Here's how you find it. In AdSense, go to Payments,
and then Manage Settings. You'll see an option to manage your US tax information there. You'll be asked a series of questions to determine the appropriate tax form. This online tax form will be available in your selected AdSense language.

Generally, for creators outside of the US, this will be either form W-8BEN, which is typically for individuals, or form W-8BEN-E, which is
typically for businesses. If you're unsure about which
forms you need to fill out, you should consult the tax advisements. Note, even if you're paid by an MCN, you will still need to
submit your tax info in the AdSense account that's
linked to your channel. – [Sean] So that means that if you're a multi channel network…

Sometimes, we'll work
with YouTube creators and bypass YouTube AdSense. They basically are
handling all of your ads, maybe negotiating higher CPM's, but because it's through
the YouTube platform, and via your MCN, you're
going to make sure. You're also gonna need
to submit your tax info. – [Man On Video] How
much will you be taxed? How much you'll be taxed
depends on a few things. It depends on if your valid tax form has been submitted or not, how much your channel
earns from US viewers, and if your country has
a tax treaty with the US that you clam the benefits for. – [Sean] So if you're out of the US, you want to make sure you have
actually submitted your form, 'cause if you haven't,
they're gonna force the 24%. You're gonna wanna make sure… And it depends on how much you're earning, and here in the US, that could be related
to, like, tax brackets.

You're taxed at different
percentages depends on, depending on how much
money you're earning, and if your country has a tax treaty. So this can get kind of complex. I just want this on your radar. Not trying to stress you
out on Memorial Day weekend, but I do want you to have… Be on top of this information, so you can get it done by the deadline, which is May 31, 2021. – [Man On Video] Let's dive
into each of these factors. First, is your tax form submitted? Once you submit a valid tax form, you can find your tax withholding rate in the Payment section of AdSense. Tax withholding rates
are between zero to 30%, depending on your country, and are applied to your monthly
US earnings from AdSense. If you wanna calculate your US earnings, go to YouTube analytics,
and then Advanced Mode. Then select the date
range you want to look at. Since you're paid monthly, we suggest setting the date
range to look at the month you want to calculate,
then click geography.

From here, add a secondary metric, and choose your estimated revenue. From there, find the US in the list of countries
below to graph to see your estimated US revenue. For example, if your
withholding rate is 30%, and you make $200 from the US every month, $60 would be withheld monthly. Now what happens if your
tax form is not submitted? If Google does not have
a tax form from you by the time these changes go into effect, Google will be required by law
to presume you're a US person if you have an individual AdSense account. This means until we have
your completed tax info, we may need to withhold up to 24% of your total earnings worldwide. – [Sean] There's the big
thing that I want you to see. Again, get your completed tax info in, otherwise Google may need to withhold 24% of your total earnings. Not just your US earnings. So again, your whole
account earns 10 grand. 2,400 is gonna be withheld if your tax information is not updated. By the way, if you're finding
this information valuable, smash the like button.

You may not want to like this information, but if you do like getting news like this, and you appreciate when
I do videos like this, just let me know, and let me know if you have
any questions about this. We'll keep going. – [Man On Video] Not
just your US earnings. So the earlier you can get
your forms in, the better. And finally, does your country have a
tax treaty with the US? Some countries have a
tax treaty with the US that can potentially reduce
the tax withholding rate on your revenue. So if you submit your tax info,
and claim a treaty benefit, your tax rate might be reduced. For example, partners in the UK or Canada may be eligible for a
tax rate of zero percent, where partners in Mexico or Korea may be eligible for a tax rate of 10%.

AdSense will automatically
surface the opportunity to claim a treaty benefit if one exists between your country and the US. – [Sean] So log into your AdSense account, start filling out your information. Let me know. Where are you in the world
with your YouTube account, and are you a part of the YPP,
the YouTube Partner Program. Again, there might be a tax treaty, and you can pay as much as zero percent, Canada and the UK potentially, or 10%, as they said in, like, Korea. And so, when you log into the backend, or you see inside of your backend, Google AdSense will surface
that opportunity for you to claim a tax credit, or see that this doesn't maybe
affect you very severely, and that's gonna be based on
the country that you live in. Footnote on that. Even here in the US,
people will often move once they discover
disadvantageous tax situations in certain states. For example, people are fleeing California for a lot of reasons right now, but one of the reasons why here in the US people are doing that
is because sometimes, you could pay over 50%
of your money in taxes.

But if you move to a different state, there might not be income
tax, like here in Nevada, where I live in Las Vegas. There may be states that are more friendly to small businesses. That's again, another reason
why we love Washington, Nevada, and why we choose where we live. So I know it might be
easier said than done, and you're like, "I can't
just leave my country." But consider, like, understanding taxes, you may not have thought about it before.

It could influence your decision of where you wanna build your empire, where you wanna build your business, where you wanna be planted
and build your family, in terms of finances. – [Man On Video] To claim
a tax treaty benefit, you'll need to provide a non
US tax identification number in the tax identity section
of the tax tool in AdSense. This is issued by your local
tax authority or government or in some cases, you could provide a US
Tax Identification Number, like an Employer
Identification Number, EIN, or an Individual Tax
Identification Number, ITIN. To see a list of countries that currently have a US tax treaty, check out the link in the
description to the IRS website. For more detailed information
on this tax requirement, please check out our help center and the links in the description below.

Thanks for watching. – [Sean] So I will link to that video, so you can go check out all
the links in that video. Plus, I will link some resources in the description of this video as well. You know, does this pertain
to a non monetized channel? It doesn't at this time. At some point, Max, you'll wanna set up your
Google AdSense account, and then think through this. Crafty's asking if your channel's not monetized and very small, do you need to do anything? Nope, could be because you're not at this point earning income. James says who's taking my money? It may be Google that is
forcing this to happen, but it's because of the IRS, and them being in compliance
with the tax code. So who is ultimately taking your money? It is ultimately the Internal
Revenue Service in America, where YouTube is based. Two things are certain in life,
my friends. Death and taxes. And so, this is just
the nature of the game.

You can't… Even though you can be
frustrated with YouTube or Google about this, it is outside of their
control more or less. They're staying in compliance,
as it pertains to this, and so really quick, I just want to give you three
quick tips in response to this in what I think you should do, and how you can navigate things. Let's see. Question. Do you have to deal with
this if you're under 18? You shouldn't, but
whoever owns your account, or once your YouTube account
starts being monetized, share this video with
your parents. (laughs) Whoever is, like, the dependent responsible for
your YouTube channel, whoever. This is connected to either
their social security number, or some kind of a tax
identification number even here in the US, and if
you're just joining this video, you can watch the replay. The YouTube video broke down how you go into your AdSense account, make sure your tax info is current. But the first tip is just make sure you submit valid tax forms.

I know. It's not what you wanted
to do this weekend, or whenever you're watching the replay, but please go into the backend
of your YouTube channel, but more importantly, go into
your Google AdSense account and submit valid tax forms. The deadline is May 31, 2021, or there could be forced withholding. By the way, what even is withholding? It actually kinda brings
us to tip number two.


Get educated about money and taxes. All I can speak to is here in the US, but withholding is, like,
when you work for an employer, you're gonna go to your employer. You get your paycheck every week. Then you look at your
paycheck, and you're like, "What the heck? Why is there, like, four different things that are being taken out of my paycheck?" Those are going into
maybe social security, and some are going into withholding. The way it's set up here in the US is that money is withheld by your employer, and given directly to the IRS. So this means that, you know, what the government, here in the US, is not letting you do is
they're not letting you take your money first,
do what you want with it, and then trusting you
later to pay them taxes.

As you work your job, they're taking the
money out of your check. The reason the second tip
here is to get educated about money and taxes is years ago, I read a book called,
"Rich Dad, Poor Dad," by Robert Kiyosaki. You ever read that book? And it started helping me think that there's the cash flow quadrants. There's four positions to be in. You could either be an employee,
a small business owner, a big business owner or an investor, and as you move up the
cash flow quadrants, you start thinking differently
and start realizing the most money most of
us will pay in our life is not actually a mortgage. It's not your water bill. It's not the Pokemon cards
you're buying. It's not whatever. It's taxes.

We all pay a lot of taxes. Unless you're, like, below a poverty line, and there's ways to reduce your taxes, and so one of the best
things you could possibly do is start a home based business,
aka a YouTube channel, even that is not making
money yet, because again, depending on where you live. Do your own research. I am not a CPA, and this is
for entertainment purses…

(laughs) purposes only,
and not financial advice. But start a home based business. You can start writing off
your computer, your cameras, your epidemic sound subscription service, your VIDIQ subscription, things related to your
home based business, a percentage of square
foot of your home office, which could come off of your rent, and of course you gotta cross
your Ts and dot your Is, and you may not, you may not be like, "Sean, I don't wanna get
educated about this." It's one of the most important
things you could ever do, is get a financial education. But hear me. Start a home based business. Start thinking not like a
hobbyist that's just dabbling, but like a business
owner that's dominating, even if it takes you a couple
years to be profitable.

There's a few years here in the US where you're allowed to run your business and it's not considered a hobby yet, because when you do a start up, you're gonna go negative for a few years. So you write off that laptop, and you're writing off the
software, and you're writing off. So get educated about money and taxes, and if you would like
me to have my friend. I have different CPA friends,
the CPA's we work with, that could go deeper into tips
on that, then let me know, and I'm also gonna link a
few books in the description.

Here's the question you should ask. What can I legitimately write
off in my home based business so you can start reducing your tax bill?" So keep this in mind, here in the US. If you were to get 24%
of your money withheld, this is why you get a
refund, and people are like, "Oh cool. My tax refund came." That's actually not that cool. That means that the government
held your money hostage, they kept it for most of the
year, and then they're like, "Oh, you can actually have it
back. It was yours all along." The business owner's in a better position because they're actually paying taxes after they've kept the money,
and they're able to use it, invest it, get interest on it, and potentially build up write offs, and build up investments that they make, and then pay the government
once they owe taxes, versus having it withheld upfront.

If you followed me there, type yes in the comments with the chat. If that was just a long
stream of nonsense, then hey. Get educated about money and taxes, and let me know if you have
any questions about that, or if you'd like for me to
have my CPA friend, Matt, come on the channel,
and we can do some tips on deductions and whatnot, and I'll link up some
resources in the description down below of my favorite
books on tax deductions. And then tip number three is
diversify your income streams. So a couple people asked, "Is this going to affect me if I don't even monetize my channel yet?" Well, no, because you're not gonna pay any money on zero dollars earned.

However, before you even qualify for the YouTube Partner Program, you can start doing affiliate marketing. You can start doing brand deals. Jordan Perez, who was on
the Think Media channel, and Heather and Jordan did
a video about her setup and her best tips growing
to 1,000 subscribers. She is already at 1,700 subscribers, talking to a charcuterie subscription box. That's, like, meat and cheese. She's already talking to them, and they're gonna send
her free boxes first, but then they're gonna
potentially, if it goes well, start paying her per video. Keep this in mind, friends. If a brand pays you $1,000,
that money is subject to paxes.

It just might not be withheld up front. You might get it as a 1099
at the end of the year, the following year during tax time, the government says, "Okay. So what percentage of the money that brand paid you is ours?" You're like, "Frick, dude. I don't… Are you H&R Block, Sean?
Like, what are we talking?" This, I mean… You've gotta figure this stuff
out. I know it's frustrating. As, like, a video editor
creative myself, I never… This wasn't my dream to
get educated on this, but for the preservation of the Think Media business and
family, and my own family, you gotta think about that. So one of the things to consider though, as not only this 24% tax
that can hit YouTube creators if you don't get your info sent in, is also that YouTube takes
a lot of money anyways. Like, I don't know if
you've seen lately, uh, but, like, in the old days, people used to say, you know, "YouTube gives you 55% of ad
revenue, and they take 45%." That's not even kinda true, dude.

Like, it's way worse than that. I mean, I don't know
what your numbers are, but now, we have a CPM
and a RPM, and hear me. I'm also not complaining, because I think that YouTube
is an extreme blessing that we are able to, you know,
use this platform for free, and all of those types of things. But, like, this, this… Your estimated earnings on
this video on Think Media is 280,000, but if we head
on over here for revenue, the CPM is 822, the RPM is $3. That means YouTube is keeping $5.20, and I get $3 for the Think Media team.

So that's, that is heavily, like, the money goes heavily to YouTube, which brands pay YouTube. YouTube keeps over 50 in
my case, and by the way, it's different every video. It's different, whatever. But, like, they keep probably 50, 60, 70%. You get the next 30% of that ad revenue. Those numbers are always shifting, but we know for sure, if
you do channel memberships, out of every $10, YouTube's keeping three. If someone gives you a $10 superchat. Thank you for the
superchat, Jaden, YouTube… Out of the two dollars
superchat you gave me, is taking 60 cents. That went into YouTube's pocket, and thank you for the money that went into Think Media's pockets so we can make videos like this, and so what's the tip number three? Diversify your income streams, because you wanna start, number one, yes, doing affiliate marketing
or maybe doing brand deals, but eventually, the goal is
to create your own thing. You know, we do have a
deep dive YouTube course.

Many of you have heard about it. It's called Video Ranking Academy. Not only is it the greatest
YouTube strategy course on planet Earth. I mean, of course I'd probably
say that, but it really is. Like, the support, the Facebook
group in the community. But it's also the greatest way to, if you're getting value and you know you've got the best tips
and the best strategies to help you grow on YouTube. I mean, the value is there for you first. But it also is the best way
to support what we're doing, because we created it, so
YouTube doesn't take 30%, or some whoever doesn't take 30%. Of course, at the end of the day, we're accountable to the IRS for just the macro income of our business. My point is create your own thing. If you create, say, a
digital product for $100, you're gonna probably
keep 98% after, like, Stripe, the payment processor, or Paypal takes one and
a half or two percent, after you pay the bill for
Teachable or Thinkific, if you created an online course.

They, you know, you pay
$500 a year for membership, $1,000 a year, $1,500 a year, depending on the game you're on. After those fees, the rest
is gonna go into your pocket. You maybe create something
that's merch, okay. There's hard costs to
tshirts and things like that, but all I want to encourage you to do, not necessarily at this exact moment, but to shift your thinking to say, "Man, I've gotta get educated about money. I gotta get educated about taxes, and I gotta become more
like a business owner, CEO, and think about what's the
bigger business I'm building? What products could I build? What things could I… What IP, intellectual
property, could I create, that I'm keeping a lot more percentage, and I'm not stuck in the middle?" And this is no resentment towards YouTube.

But we are victims of
whatever they wanna do, whenever they wanna do it. Whatever tax they wanna slap
on us, and I don't resent that, because this platform's freaking cool. I can go live and connect
with you right now. We can stream right now. We can post for content 1080p content. We can spread our
message around the world. Thank God for YouTube, but also diversify your income streams.

Also, build a bigger
business outside of YouTube. Also, build an email list so you can stay in contact with people. Also, use text message. Also, grow on social media
so you're diversified. Just think about the bigger
picture in this event, in terms of YouTube taxes, is a good time to do about that. Of course, if you want to learn more about diversifying your income streams, and you haven't seen my free class, definitely check it out. I talk about multiple different
ways to earn $1,000 a month outside of the YouTube Partner Program, right outside of just YouTube AdSense. Link's in the description down below to everything related
to what's in this video. My question for you. Where are you based in the world, and are you a part of the YPP, and have you updated your tax information? Did you go in right now? Like,
"Sean, I've been in there.

I've been in. I'm logging in my AdSense. I forgot my password."
Don't you hate passwords? I mean, I don't even ever
know what my password is. So get your information updated. This is Doomsday weekend,
friends. This is it. It's over. May 31st. If you live globally, 2021. Like, they might start
withholding 24% tax. But once you get your info connected, you shouldn't have to worry. This shouldn't cause stress. It should just cause motivation. Let me know where you are in the world. Smash like if you got
value out of this video, and if you're a part of the YPP, and if you really want a deep dive training on
YouTube monetization.

I'm talking deep dive.
I break down everything. How to sign up, how to qualify, community guidelines, terms of service, just click or tap the
screen to watch that video. It breaks all the details down for you. I appreciate you so much. I'm
sending you major love on… Memorial Day weekend. Smash like. Talk soon. Peace..

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