9 {{ upvoteCount | shortNum }}
9 {{ upvoteCount | shortNum }}

Questions about 1099 forms submitted by Clickbank

by Christophe Young
7 replies
I did a search on this topic but couldn't find an answer.

I'm an affiliate AND a vendor on Clickbank and earned more than $600 as both this past year.

Does the 1099 tax form issued by CB only state your earnings as an affiliate or as both a Vendor and affiliate? Also, when do they typically mail out the 1099?

Thanks.
#1099 #clickbank #forms #questions #submitted
  • Profile picture of the author JohnMcCabe
    You'll have to ask Clickbank for a specific answer, but in general, you are talking about two different transactions.

    As an affiliate, you earned income in the form of commissions, which would have to be reported via 1099.

    As a vendor, you didn't earn income. You sold CB your product(s) for resale. You would have to report that as income from sales. For transactions via CB, you would report the amount CB paid you, not (# of items sold x retail price), just like any other wholesaler.

    And don't forget to deduct CB's transaction fees...

    Two separate line items, but both need to be reported. CB should report what they paid you as a vendor on their tax reporting under Cost of Goods Sold.

    For more specifics, consult CB and/or a qualified tax pro...
    {{ DiscussionBoard.errors[7644400].message }}
    • Profile picture of the author MilesBaker
      John is right, affiliates get 1099's, vendors don't. Yes, they mail out the 1099.

      Per ClickBank:

      U.S. based Affiliate accounts earning over $600 are required to have a taxpayer ID number of some kind linked to their account, at a minimum a social security number. If inputting a social security number, be sure to use the proper 9-digit format including dashes: 123-45-6789.

      ClickBank encourages U.S. based Affiliates earning over $600 a year to obtain an IRS issued Employer Identification Number (EIN) to input into your account as a taxpayer ID number. If you do not have one already, you may click here to get yours at the IRS web site. Note that this is a free process. The IRS will either provide your number online, or mail it to you. Once you have obtained your EIN please be sure to key it in to all of your ClickBank accounts, in this 9-digit format: 12-3456789. This helps to simplify the year-end 1099 reporting requirement.

      Note: The taxpayer ID number input to your account must match the payee name on the account. If you are utilizing a business payee name but reporting under an individual social security number, you will need to fax a completed IRS W-9 form to us at 559-210-0502. Be sure to include a cover sheet that indicates your account nickname.

      Second note: If you are utilizing a U.S. address but are a beneficial resident of a foreign country, you will instead need to fax a completed IRS W-8ben form to us at 559-210-0502. Be sure to include a cover sheet that indicates your account nickname.
      Signature
      Join the Community for ClickBank Marketers, it's Free.
      {{ DiscussionBoard.errors[7645016].message }}
  • Profile picture of the author Christophe Young
    Thanks, that makes sense. I'm just adding up my total Clickbank paychecks and reporting that as income both as a Vendor AND Affiliate. I was just curious if Clickbank broke the two down on a 1099 form.

    Guess I'll find out in a few days.
    Signature
    Under Construction
    {{ DiscussionBoard.errors[7645392].message }}
    • Profile picture of the author Dustin Lyle
      So who pays the taxes on the vended products?
      Signature

      Welcome to The Mind Of Dustin Lyle

      {{ DiscussionBoard.errors[7645416].message }}
      • Profile picture of the author JohnMcCabe
        Originally Posted by Dustin Lyle View Post

        So who pays the taxes on the vended products?
        The tax obligation splits between the product owner and Clickbank, each being responsible for their cut.

        Let's say Product X sells for $100 and the fees add up to 10% (it isn't, but this keeps the arithmetic simple). One sale is made.

        $100 - $10 in fees leaves $90. No affiliate commission. CB is responsible for $45 in sales, product owner is responsible for $45 in sales.

        CB is also responsible for the portion of their fee that goes to profit, but that's a different issue.
        {{ DiscussionBoard.errors[7647567].message }}
  • Profile picture of the author Christophe Young
    $100 - $10 in fees leaves $90. No affiliate commission. CB is responsible for $45 in sales, product owner is responsible for $45 in sales.
    Ok, but the Vendor would see $90 on his paycheck from CB and would have to report that as income I assume.
    Signature
    Under Construction
    {{ DiscussionBoard.errors[7648074].message }}
    • Profile picture of the author JohnMcCabe
      Originally Posted by Christophe Young View Post

      Ok, but the Vendor would see $90 on his paycheck from CB and would have to report that as income I assume.
      Whoops. Shouldn't try to post until the first pot of coffee kicks in.

      In the example I laid out (no affiliate), you're right. Your income from that sale would be the whole $90.

      If you offered 50% commission, and the fee was still 10% ($10), here's the breakdown:

      > CB responsible for their 10%, however they account for it.
      > You are responsible for $45 income from sales.
      > Affiliate is responsible for $45 income from commission, which would be reported on the 1099.

      Sorry about that...
      {{ DiscussionBoard.errors[7648937].message }}

Trending Topics