We already covered some of the ways to earn money by streaming such as getting people to
subscribe to your channel and support it with money each month for the content that you make. Another great way of making
money streaming is through donations. Donations are easy for viewers to make if you have a donation button, donation link, or a complete donation page
where people can easily send their money to support you.
Donations are one of many ways for streamers to gain income. We already know of subscriptions and the usual advertising
revenue through AdSense. We will go through and explain donations and, how specifically, Twitch streamers benefit from them.
What are stream donations and how do they work?
Stream donations are a way for viewers to support their favorite streaming channel with a chosen amount
of money. Donations are a one-time amount that people can send through PayPal or other money-services that the streamer accepts.
A donation usually is not a significant amount of money, but it is enough to show the appreciation
of the streamer’s content, and will often result in a “thank you” pop-up on the stream itself,
followed by a shoutout from the streamer. Some streamers also grant the viewers special perks if they donate to the channel.
Donations are a sort of passive income to put it in other words.
Donations can be set up through a donation button in the streamer’s description, which leads you to a
donation section by a link that the streamer has provided. From there the viewer will just put in the amount that he/she
wants to donate, submit it, and that’s it.
It’s almost always possible to make donations no matter the streaming platform. It can be done to
Twitch streamers, Mixer streamers, and on several other platforms.
Why do people donate to streamers?
Donating to streams that are free to watch might seem strange to some people,
but to others, it makes a lot of sense to support the channel. Showing support can be done with paid subscriptions, which is the most common way,
but some people may want to show appreciation by donating amounts that they can set themselves.
People tend to have different reasons to donate.
– They like the content that the streamer provides
This is probably the most common reason people donate money to streamers. Everyone probably has a
favorite streamer or game that they like to watch, and donating helps to support the streamers with side income so that they can keep streaming
and maybe improve the quality of the stream by buying better equipment.
– People want the highest donation
This motive might sound strange, but it is without a doubt something that happens out there. Some people will donate simply to get the
highest donation and be on top of the donation leaderboard. It sounds ridiculous, but sometimes this ends up as a competition.
Streamers will also sometimes be lucky enough to get a so-called “donation war” on their stream, where people spam the donate button and compete
against each other to see who can donate the most. This sometimes ends in amounts that match monthly payments.
– People want to support a charity
Donations are not only used for streamers to gain a side income as many streamers also use donations to support specific charities.
Making a charity stream is another way to motivate people to donate since many viewers want to support a good cause.
Charity streams might be done in a different way since you don’t donate directly through the streamer’s donation page/donate button. In many cases
you will be directed to the official charity donation page, to make sure that the money is going directly to the given charity.
Are stream donations taxable?
The short answer is yes, stream donations are indeed taxable, but it is not done in the same way as normal income. Donations should be considered
as a side income/passive income, and since people are often donating through PayPal, it is the streamer’s responsibility to pay the taxes correctly according to the
total amount of donations they’ve received.
Some people make more money streaming than others, so taxes also depends on your stream size and how many different donations you have to take care of.
People who have a lot of traffic on their donation page will also have to put in the work to do taxes correctly, otherwise, it might mess up things in the future.
Donations are usually done through online donations or even with digital currency, so paying taxes can be a bit harder than usual, so it is always advised
to contact your bank and get help if needed.
How to prevent chargebacks and spot fake donations?
Chargebacks on donations are when someone donates to a streamer and then refunds the amount.
This usually happens through PayPal and has happened plenty of times – also with a huge amount of money.
These donors are mainly trolls that want attention from the content creator on big streams while not spending any money on it.
Ways of preventing these “fake donations” would be not to accept payments through PayPal, and thereby not make it
possible for people to chargeback their money. Ways of doing this would be through either Twitch Bits (cheers) or cryptocurrency.
There are still a few other precautions when using PayPal, such as keeping an eye on donation amounts that seem unusual.
Another thing to look out for are names that you have never seen before, especially if they donate large amounts of money – that could very well be a fake donator.
Overview: How you can start earning donations for your channel
Getting donations can be hard and it really depends on what kind of viewers you have, how you set up your donation page, and how the donation button
in the description of your streaming channel appears.
1) Make it easy for people to donate
Making it easy to donate is absolutely key since people don’t want to go through a huge struggle to donate an amount.
You want to have a catchy donation button image in your description that tells people that this is where to click if you want to donate.
This donation button has to redirect the viewer automatically to the donation page, so the viewer is guided all the way.
2) Let people know how donations help the stream
Always make sure to tell people that donations are highly appreciated, and let them know how the money will be spent. People will be
more likely to donate if they know that it supports you, your content, and your cause.
3) Appeal to the right audience
Not every audience has money to donate to streamers, which is why it’s important to appeal to the right people.
If you appeal to a young audience it is very unlikely that they have money to spare for stream donations.
If you appeal to an older audience, you will have viewers with higher educations, full-time jobs,
and money that they can afford to spend on donations. Hopefully, this guide has helped you learn a lot about donations and how you can use donations
as a source of income and attract donors. If you know streamers who may benefit from this guide then please share it on social media to help them.
Created by Vejvad & Dan