NEW YORK — A “side hustle” can be one way to try out a new business idea before taking a full-fledged jump.
Nearly 1 in 3 Americans earn money on the side in addition to working full time, a Bankrate survey found.
But having a side hustle can be tricky to maintain. And if you’re not prepared, you might be on the hook for unpaid taxes and other headaches. Here are some tips to start working for yourself, even if it is just on the side.
Even if you’re simply turning a hobby into a way to make a few dollars, creating a detailed step-by-step business plan can help prevent problems later. Keep detailed records of all expenses and communication. Downloading an an expense-tracking app may make bookkeeping easier.
Anyone earning over $400 from self-employment must file a tax return. And the IRS requires self-employed workers to file estimated taxes quarterly. It might be worth consulting a tax professional to determine the best tax filing route to take.
Taxes aside, it’s important to figure out how much time you want to dedicate to the side hustle so you don’t get burnt out or overwhelmed. And building a customer base is key: gathering email and other contact information from customers can help you get feedback that could determine next steps.
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