Side Income Tax Prep Guide

SE Tax: $28,000 net × 15.3% = $4,284. You deduct half ($2,142) as an above-the-line deduction. Quarterly payments: Apr 15, Jun 15, Sep 15, Jan 15 — pay $1,071/quarter to avoid underpayment penalty. Deductible expenses: Home office (dedicated space × % of home), Adobe CC $660, equipment ($1,200 — Section 179 full deduction in Year 1), packaging and shipping supplies, Etsy listing fees and transaction fees. SEP-IRA option: contribute up to 25% of net self-employment income (~$6,500) — reduces taxable income dollar-for-dollar. Record-keeping: use Wave or QuickBooks Self-Employed; keep all receipts digitally for 3 years.