By Ashlea Ebeling



Even before the pandemic, the number of Americans working for themselves full time or as a side hustle had been growing, with more than 27 million taxpayers reporting “sole proprietor” income to the IRS for 2018. After the tsunami of Covid-19 layoffs in early 2020, a record 4.3 million folks started new businesses in the U.S. in 2020—mostly of the one-person variety.

Whether you’re a full-time gig worker or a regular employee moonlighting on the side, you’ll come out ahead financially if you’re aware of both the special tax benefits and traps that come with self-employment. 

Here are five things the self-employed should know about taxes.