YouTuber Taxes in South Dakota - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for a YouTuber in South Dakota

Creating content amidst the stunning landscapes of the Black Hills and Badlands as a South Dakota YouTuber offers unique opportunities, but also brings specific tax responsibilities. Regardless of views or subscriber count, income earned through YouTube is generally considered self-employment income and is subject to both federal and, potentially, state taxes.

The IRS requires all self-employed individuals, including YouTubers, to report their income and expenses on Schedule C (Profit or Loss From Business) with Form 1040. Crucially, earnings exceeding $400 necessitate the payment of self-employment tax, covering both Social Security and Medicare contributions. Accurate record-keeping throughout the year is paramount for maximizing deductions and ensuring compliance.

How South Dakota Handles Gig Worker Taxes

South Dakota stands out as one of the few states with no state income tax. This means YouTubers operating within the state are not subject to a state-level income tax on their earnings. However, this does not exempt them from federal income tax or self-employment tax obligations. The lack of state income tax can be a significant benefit, allowing creators to retain a larger portion of their earnings. However, it also means South Dakota relies more heavily on sales tax and other revenue sources, so understanding federal tax rules is even more critical. Many South Dakota YouTubers find themselves focusing on maximizing federal deductions to offset their tax liability. Furthermore, while there's no state income tax, sales tax may apply to certain revenue streams, such as merchandise sales or sponsored content where a physical product is involved. It's important to consult with a tax professional to determine if sales tax registration and collection are required. For more information on South Dakota tax regulations, please visit the South Dakota Department of Revenue: https://dor.sd.gov/

Key Tax Deductions for Home-Based YouTubers

• Home Office Deduction: To qualify for the home office deduction, the space must be used exclusively and regularly for business. “Exclusive use” means that portion of your home is used solely for YouTube-related activities – it cannot double as a guest room or family space. “Regular use” implies consistent and ongoing use for business purposes. Taxpayers can choose between the simplified method (a standard rate of $5 per square foot, up to 300 square feet) or the actual expense method, which requires calculating a percentage of mortgage interest, rent, utilities, and other home-related expenses based on the business use of the home.
• Hardware & Software: The cost of essential equipment like computers, cameras, microphones, lighting, and editing software (such as Adobe Creative Cloud subscriptions) are generally deductible as business expenses. If an item has a useful life of more than one year (e.g., a computer), it may need to be depreciated over its useful life rather than deducted in full in the year of purchase.
• Internet & Phone Bill: If your internet and phone are used for both personal and business purposes, you can deduct the percentage attributable to business use. For example, if 75% of your internet usage is for YouTube-related activities, you can deduct 75% of your internet bill. Maintaining a log of business usage can help substantiate this deduction.

Note on Mileage: As a home-based YouTuber, mileage deductions are typically less significant. However, any travel directly related to your YouTube channel – such as attending industry events, meeting with sponsors, or filming on location – can be claimed using the standard mileage rate or actual expenses.

The 15.3% Self-Employment Tax Explained

The 15.3% self-employment tax is comprised of two components: 12.4% for Social Security and 2.9% for Medicare. This tax is essentially the equivalent of the employer and employee portions of these taxes for traditional employees. You are responsible for paying both portions as a self-employed individual. However, you can deduct one-half of your self-employment tax from your gross income when calculating your adjusted gross income (AGI).