Right now, I pay for marketing every month, which earns me traffic and I earn a small amount of profit. I'm looking to scale this up and acquire some partners. I will pay to bring traffic to these partners' websites, they'll get paid from their Adsense account, and give me a cut every month. I have no idea what this will mean as far as taxes are concerned. I know, on my Adsense account, I'll get a 1099 (I believe) at the end of the year, and I believe, since I'm in Texas, I'll get taxed around 23% for federal income tax. I'm not sure how it'll work when I have around five partners who are all giving me a cut every month and I'm paying for their traffic. This is based on very little research, but I was thinking for forming an LLC, opening a bank account for the LLC and all of my transactions for the business will occur through this account. Anytime a partner pays me, they will most likely pay through Paypal, then I'll transfer from Paypal to my bank account and back out to my contact who will do the marketing. I guess my question is, is this a good plan, and I want to know what exactly will I be taxed on. I'm hoping that I can deduct the money I pay for marketing as a 'business expense' so that I just am taxed on the profits. Also, if I decide to purchase other things using that account (such as a new laptop), could I also write it off as a business expense? Any help would be greatly appreciated.