Side Hustle Expenses and Taxes

Side-hustle income can create both income tax and self-employment tax. Tracking expenses helps estimate net profit, which is often more important than gross revenue.

Examples of business expenses

Possible expenses may include supplies, software, payment processing fees, advertising, mileage, education, equipment, or a home office, depending on the business and rules.

Keep clean records

Separate business and personal records when possible. Save receipts, invoices, mileage logs, bank statements, and payment platform reports.

Estimate throughout the year

Because tax is not automatically withheld from many side-hustle payments, setting aside a portion of profit can prevent a difficult tax bill later.