Summer is the perfect time to pick up a side hustle — whether it’s driving for a rideshare app, selling handmade goods online, freelancing, or starting a seasonal service like lawn care or tutoring. While the extra income is great, many people don’t realize that side hustles come with their own set of tax responsibilities.
At Peavy and Associates, we help individuals across South Carolina — from Conway to Surfside Beach — understand what earning additional income means for their tax situation. Here’s what you need to know to keep your summer side hustle both profitable and compliant.
1. Yes, You Need to Report That Income
All income — even from a small or occasional side job — must be reported to the IRS. Whether you receive payments via cash, checks, Venmo, or third-party platforms like Etsy or Uber, it’s considered taxable income.
Pro Tip: Keep detailed records of all payments received and any business-related expenses.
2. You May Owe Self-Employment Tax
If you earn $400 or more from self-employment during the year, you may be required to file a tax return and pay self-employment taxes, which cover Social Security and Medicare. Unlike traditional jobs, taxes aren’t automatically withheld from side hustle income, so you’ll need to plan ahead.
3. You Can Deduct Business Expenses
The good news? Many side hustlers are eligible to deduct expenses such as supplies, mileage, advertising, equipment, and even a portion of your home office. These deductions can reduce your taxable income — but only if they’re properly documented.
4. Consider Making Estimated Quarterly Payments
If your side hustle income is substantial, you may need to make quarterly estimated tax payments to avoid penalties. June is a great time to estimate your income and determine whether this applies to you for the rest of the year.
5. Keep Personal and Business Finances Separate
Open a separate bank account for your side hustle to help track income and expenses clearly. This not only makes tax filing easier but also provides a more accurate picture of your business’s financial health.
Whether your side hustle is just a summer gig or the beginning of something bigger, Peavy and Associates is here to help you navigate the tax side of self-employment. Our team can walk you through deductions, help set up a system for recordkeeping, and make sure you’re fully prepared when tax season rolls around.
CONTACT OUR CONWAY OFFICE
Conway, SC Offices
Main Conway Office:
1516 E HIGHWAY 501, Unit 104
Conway, SC 29526-9471
📞 Telephone: (843) 347-0849
📠 FAX: (843) 347-0857
📧 E-mail: peavy@peavyandassociates.com
🌐 Website: www.peavyandassociates.com
CONTACT OUR SURFSIDE OFFICE
Surfside Beach Location
The Courtyard, Suite 304
1500 Business Hwy 17 North
Surfside Beach, SC 29575
📞 Telephone: (843) 238-4863
📠 FAX: (843) 238-5447
📧 E-mail: amy@peavyandassociates.com
🌐 Website: www.peavyandassociates.com