The Biggest Side Job Mistake
Everyone Wants To Make More Money
Who doesn’t want more money? For many that means picking up a side job to earn a little more cash. There are literally hundreds of side jobs out there and while most are only good for a few extra dollars, some can bring in enough to be a significant help with finances. However, there is a danger to doing work on the side if you are not careful.
If you work as an employee you don’t have much to worry about, but if your side gig is something you do as a self-employed worker, you need to be aware of the tax implications. As it turns out, this is one of the biggest problem areas for people who work side jobs, especially for younger people.
The problem is many Americans are not reporting this extra income. In fact, according to a recent study from Finder.com, roughly a fourth, or 69.8 million, of all Americans who make money from a side job neglect to report it on their taxes.
That adds up to a large junk of change according to the IRS. The tax agency claims that tax evasion costs the government more than $450 billion a year. Of course, that figure is not all from unreported side job income, but the IRS says nearly $215 billion of it is.
That is a lot of money, which is why the IRS takes reporting your side job income seriously. If you get caught not reporting this extra money it could cost you. The IRS can charge you as much as 5 percent for each and every month you are late paying on those taxes. Furthermore, if you don’t report and pay an accurate amount, you could end up paying additional penalties and interest, as well face criminal charges.
So if you walk dogs, repair cars, teach music lessons, babysit, do a little writing on the side, earn money on YouTube, or anything else to make a few extra bucks, be sure you report that income to the IRS.
We hope you found this article about the Biggest Side Job Mistake helpful. If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page or home page www.Groco.com. Unfortunately, we no longer give advice to other tax professionals gratis.
Considerately yours, GROCO, GROCO Tax, GROCO Technology, GROCO Advisory Services, GROCO Consulting Services, GROCO Relationship Services, GROCO Consulting/Advisory Services, GROCO Family Office Wealth, and GROCO Family Office Services.
To receive our free newsletter, contact us here.
Subscribe our YouTube Channel for more updates.
This transcript was generated by software and may not accurately reflect exactly what was said.
Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com. GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.
Alan L. Olsen, CPA, Wikipedia Bio
Why Is Integrity So Important for Building Trust?
One of the greatest attributes a business can have is trust. Trust is so important between a company and its customers, as well as between the leaders of a company and the rest of the staff right on down the line. Trust can take a long time to build, but it can be lost…
The State of the Private Equity Industry—Is It All Down Hill From Here?
In the past private equity has been a solid way of investing taking in trillions of capital, but with the ever changing world we live in, what is the state of the industry? Private equity investments typically consist of money being placed in a company by venture capital firms, private equity firms or angel…
How the Wealthy Save on Taxes
Whether you make minimum wage or you’re in the richest 1 percent of earners, every taxpayer likes to keep as much of his or her hard-earned income as possible. There are hundreds of ways to save on taxes and many of these strategies are universal to all taxpayers no matter which tax bracket they…
How the Internet Became Commercial
What’s Behind the Commercial movement of the Internet? Believe it or not the Internet was not originally created to share your life on social media sites like Facebook and Instagram or to watch movies, play games or follow your favorite pastime. When it was first invented, the military and research universities were the primary…