How Much Are Americans Earning From Their Side Hustles in 2025? Less Than You Think
Written by
Gabrielle Olya
Edited by
Heather Taylor
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All over social media, we’re inundated with stories of side hustle millionaires — but this is definitely the exception and not the rule. According to a recent TaxAct survey, 73% of side hustlers make less than $1,000 a month, with 45% earning less than $500 a month. Just 3% of Americans bring in $5,000 or more a month through their side hustles.
However, even if you don’t earn much from your side hustle, it could still be “worth it” to pursue thanks to the unique tax advantages granted to freelancers and self-employed workers. Yet, many side hustlers don’t know the full extent of the tax implications of their part-time gigs. The survey found that 32% of side hustlers need guidance with their tax filing and 9% were not aware there were tax implications related to their side hustle.
Here’s what every side hustler needs to know about taxes, regardless of whether or not they make it to side hustle millionaire status.
Tax Advantages of Having a Side Hustle
There are many different tax advantages that a person with a side hustle can claim on their taxes.
“As a side hustler seeking to make a profit, the IRS stipulates that anything ordinary and necessary for your side hustle can qualify as a tax deductible item on your tax return,” said Mark Jaeger, VP of tax operations at TaxAct. “Popular items can include computers, cellphone bill for business use, mileage, home office and computer software.”
Why Having a Side Hustle Can Be ‘Worth It’ Even If You Don’t Make a Lot
More often than not, the tax benefits of having a side hustle are worth continuing to pursue it, even if you make less than $1,000 a month.
“If this is simply a hobby and not an actual side hustle for profit, the tax advantages just won’t be there. However, if you are looking to make a profit out of this, if you have a side hustle that you normally would do anyway, then it is a great way to make money and potentially lower your tax bill overall while doing the things you love,” Jaeger said.
“For instance, you may be an animal lover and spend money personally doing many wonderful things for your cherished pet,” he continued. “If you find a side hustle that allows you to continue splurging on your best friend while also being able to deduct those costs, then you have hit the jackpot.”
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