Nadya Okamoto is getting married this summer and wasn’t sure if she could write off the cost of a professional photographer.
The 28-year-old earns most of her income posting about her life on TikTok, YouTube and Instagram, and plans to post photos of the ceremony online. She didn’t know if any of the wedding costs would count as a business expense.
“There is not a lot of separation between my life and content creation,” said Okamoto, who lives in New York.
Okamoto is among the influencers learning to navigate the intricacies of the tax code, with Goldman Sachs forecasting the “creator economy” will grow to nearly $500 billion globally by 2027, roughly double its size in 2023.
Like others who are self-employed, influencers pay taxes only on the money they earn after deducting work expenses. But when makeup, pets and meals play starring roles in social-media posts, figuring out what counts as a tax write-off can get messy. It’s one example of how the changing ways people work are butting up against tax rules that were established decades ago.
“If you are a real-estate agent, or an insurance broker or a freelance journalist, there’s a clear line between what’s a business expense and what’s a personal expense,” said Katherine Studley, a tax consultant who works with influencers. “It’s not bleeding into your everyday life.”
A quarter of influencers say taxes are their top source of business stress, and nearly 25% say they’ve made tax mistakes that cost them money, according to a recent H&R Block survey.
Clothes are a common area of confusion. Influencers might want to deduct clothing purchases if they feel their appearance is a part of their online persona, but accountants say they’d have to be able to show the outfit would only be worn in a specific work-related context.
“If you can take it off and leave it on set then it could be 100% deductible. But if you can walk out the door and go on a date with it, then it’s a personal expense,” said Hannah Cole, who lives in North Carolina and founded Sunlight Tax, which specializes in working with creative professionals.
For the same reason, she said influencers typically can’t deduct costs such as gym memberships and haircuts if they’re not a direct part of their content.
Another gray area: swag that influencers get from companies. Products that are worn or reviewed in a video might count as taxable income, but items that are never featured in posts could be gifts that aren’t taxed, said Andy Phillips, vice president of The Tax Institute at H&R Block.
H&R Block for the first time this filing season has added “creator” to the list of occupations people can select to populate tax forms. At a recent event the company held for influencers in New York, attendees asked about the quarterly tax payments most self-employed people are required to make. Accountants say influencers should save anywhere from 30% to 50% of their earnings for the payments. Still, surprises are common.
Gabby Beckford was shocked when she was hit with a five-figure tax bill in 2024. The 30-year-old travel influencer had been making quarterly tax payments based on her earnings in a previous year when she earned less.
“It was painful,” said Beckford, who makes more than $300,000 a year from chronicling her solo travels on social media, as well as from speaking engagements and brand deals.
Beckford plans to deduct about 25% of the rent for her New York City apartment as a home-office, since she uses one room only to film content when she’s not traveling. She also plans to deduct $250 she spent to frame the art in the room.
Accountants suggest that influencers keep meticulous records to defend their deductions.
Okamoto gained a following in college after she started posting about her life and company, which provides menstrual products. She now has more than four million followers on TikTok, where she includes posts about her running and cameos from her dog, Mimi. (The dog has its own Instagram account but, alas, isn’t a deduction.). Since announcing her engagement to her followers, she has been approached with brand deals for her wedding, including for her dress, the rings and stationery—items that might count as income.
After speaking with her accountant, Okamoto decided her wedding expenses wouldn’t qualify as a write-off. She noted such considerations aren’t a typical part of wedding planning.
“There is money that I’m making as a business coming in specifically because of the wedding,” she said.
Write to Oyin Adedoyin at oyin.adedoyin@wsj.com