Track everything
- Keep separate records of income and business-related expenses.
- Use a dedicated bank account (or sub-account) for side income and expenses.
- Save receipts and invoices; consider simple bookkeeping or an app.
Taxes
- Set aside 25–30% of net profit for taxes (or use a calculator).
- Pay estimated quarterly taxes if you'll owe $1,000+ for the year.
- Understand self-employment tax (Social Security and Medicare on net profit).
Retirement and benefits
- Consider a SEP-IRA or solo 401(k) to save for retirement and reduce taxable income.
- You don't get employer benefits; budget for health insurance and emergency fund.