Yes, where you report royalties from Twitch depends whether this is self-employment income or a hobby. In general, if you regularly create intellectual property that can be subject to a copyright or patent (for example, you're an artist or musician), you should report income from this self-created property as Business Income.
If you intend to pursue this activity as a business with the intent to earn a profit, then you would report this as self-employment income on Schedule C (subject to self-employment income tax). This option is available in TurboTax
Self-Employed.
However, if this is a hobby or occasional income with no profit motive, you may report this as "Hobby/Other Income" on your personal tax return. You may include hobby expenses up to the amount of hobby income, but you cannot report a loss on a hobby.
This post may help you decide which is most appropriate: What's the difference between self-employment income and other income?
The easiest way to find either section of TurboTax is to use the Search box at the top right side of the TurboTax header. Click on the magnifying glass, type in "schedule c" or "hobby income", and click on the related jump-to link to go directly to beginning of the section. Follow the prompts to enter your income and expenses.
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