I got an email the other day from someone inquiring about CashCrate and taxes. It was not the first time someone has asked me about taxes for money that I make online but all the inquires seem to be similar: everyone wants to know if taxes are withheld. Here is the email:
I’m in college and I was just wondering do you have to pay taxes on this every year or do they take taxes out. That is one of my concerns because I don’t want to have to pay taxes on it since I’m still in college. I have a lot going on and just need a quick way to earn a little extra cash while I’m off at college and don’t really have a job. I just don’t want to have to pay taxes because I have no way to really pay for them.
First of all, almost all sites like CashCrate will NOT take taxes out of your checks. If you make money with them you are considered to be “self employed” and NOT an “employee”. So it is up to you to keep track of how much you make and pay the tax owed (if any) on your own.
What they are required to do though, is get your Social Security number if you make more than $600 in a year and then they have to report to the IRS that they paid you that money. Once you reach the $600 amount, CashCrate and other sites will withhold all payments until they get your SS#. Again, most survey websites are similar to CashCrate and will follow this same general format.
How About Affiliate Marketing Websites?
If you start making more money with Internet marketing and join any affiliate marketing sites like Commission Junction, NeverBlue, Max Bounty, or any of the dozens of others like them, they will require you to give them your Social Security number up front as part of the registration process. This is the same for sites like Amazon, Ebay, or any other company that pays you directly for the affiliate sales you make with them. But again, they will NOT withhold tax from the checks they send you as it is up to you to find free tax software and file and pay your taxes. They also consider you self employed (or a subcontractor) and that means they are not your employer and don’t have to collect tax.
No One Wants To Pay Taxes But It Is The Law
The last line of the email was curious and sounds to me like this college student wants to avoid paying taxes if they can. After all, does this person think that anyone WANTS to pay taxes? No one wants to but it is the law and if you don’t like it, then you need to educate yourself and vote for politicians who want to LOWER your taxes rather than raise them.
Younger people who maybe haven’t had a job yet or are just starting out have no idea how awful paying taxes are. We all know we have to pay something for the police, fire fighters, road and bridge construction, and things we all obviously need. But we pay a lot in taxes that our government and politicians absolutely flush down the toilet and it is the reason why our country is in such an economic mess right now. So, anyone who wants to be financially successful some day better get ready and willing to pay a BIG CHUNK of their money to our government because taxes are never going to go away.