Payouts and taxes

This is not tax advice. It explains how we expect to pay and report your share of Spotify earnings, so you know what we will ask you for. Your own situation may differ: ask your tax adviser. Where this page and the Terms (section 8) differ, the Terms apply.

1. Payouts are not open yet

Payouts are not open yet. We tell you in the app and by email when payouts open for your account, and we then ask you in the app to set them up. Until then, your share of each month stays recorded as money we owe you. How the share itself works: Spotify monetization.

2. The short answer

• Your share is most likely a royalty. We pay you 90% of the ad money Spotify earns from your show, which is your copyrighted work. For US tax, that is most likely a royalty, not a payment for services.
• We pay you once your tax form is on file. Until then, your share stays in your balance.
• If you are in the US, you give us your W-9 details (Stripe asks for them when you set up payouts), and you get a Form 1099-MISC from us for each year we pay you $10 or more in royalties. If your W-9 has no taxpayer ID yet, or the IRS tells us yours is wrong, the law makes us hold back 24% of each payment (backup withholding).
• If you are outside the US, you send us a Form W-8BEN (or a W-8BEN-E for a company). The part of your earnings that comes from listeners in the US may be taxed by the US at 30%, or at a lower rate if your country has a tax treaty with the US. We withhold that tax and report it to the IRS on Form 1042-S.
• Everything is paid in US dollars, through Stripe.

3. How you are paid

• You set up payouts in the app, through Stripe's payout onboarding (a Stripe Express account). First you choose the country you live in, or where your company is registered. It cannot be changed later, because Stripe fixes an account's country when it is created, and it decides which tax form we need.
• In the US, Stripe's onboarding collects your W-9 details. Outside the US, you email your W-8BEN or W-8BEN-E to engineering@rebelaudio.ai and we record it. Your payouts page shows whether we have your form.
• Once a month we send your share, minus any tax we must withhold, as a transfer in US dollars to your Stripe Express account, and Stripe pays it out to your bank. Your payouts page shows each payout's full share, the tax withheld and what was sent to you.
• The minimum payout is $10. A smaller amount is added to the next month until the total reaches $10.
• You are responsible for the taxes on what we pay you. Where the law requires, we collect tax forms (through Stripe in the US, by email outside it) and withhold or report amounts; an amount we withhold counts as paid to you.

4. If you are in the US

• What we ask for: your name, address and taxpayer ID (your Social Security number or EIN), the details of a Form W-9, before your first payout. Stripe asks for them when you set up payouts and checks them with the IRS. If Stripe cannot verify them, your payouts page asks you to correct them on Stripe or to email a signed W-9 to engineering@rebelaudio.ai.
• What you get: a Form 1099-MISC, with your royalties in box 2, for each calendar year in which we pay you $10 or more in royalties. We file it with the IRS, and with your state where your state requires it.
• Backup withholding: if your W-9 has no taxpayer ID yet, or the IRS tells us yours is wrong, we must hold back 24% of each payment and send it to the IRS. The 1099 then shows the full amount and, in box 4, what was held back.
• A creator that is a company is generally not sent a 1099-MISC. Ask your adviser how that applies to you.

5. If you are outside the US

• What we ask for: a Form W-8BEN if you are an individual, or a Form W-8BEN-E if you are a company, signed and emailed to engineering@rebelaudio.ai. To use a treaty rate, fill in Part II; the form must be valid and usually include your taxpayer ID. Until we have your form we do not pay you: your share stays in your balance. If a form is not valid, the 30% rate applies.
• What is taxed: only the part of your earnings that comes from listeners in the US is taxed by the US. The rest is not subject to US withholding.
• Until we can split it: Spotify's statements do not yet tell us which country your listeners are in, so we withhold on your whole share. That can mean more is withheld than the US-listener part needs.
• What we file: a Form 1042-S for you each year, reporting what we paid you and what we withheld, and a Form 1042 for all of them.

Treaty rates. The rate depends on your country and on the kind of royalty: most podcasts are copyright royalties (IRS income code 12); a video podcast may count as film and television (code 11), which changes the rate for Canada and Italy.

From the IRS's tax treaty Table 1 (revised May 2023). A treaty rate also depends on the treaty's own conditions; your adviser can tell you whether you qualify.

6. Where to read more

• IRS Instructions for Forms 1099-MISC and 1099-NEC
• IRS: backup withholding
• IRS: sourcing of income for nonresidents
• IRS Publication 515

7. Questions

About your payouts or the forms we ask for: engineering@rebelaudio.ai. About your own taxes: your tax adviser.