@fujipro400 wrote:
Thank you again! I appreciate it. I guess I'm just worried about the future and don't really understand the purpose of potentially paying taxes on the business now to justify saving later when I may never make enough to reap those benefits. Though you mention being able to make deductions from the 'side gig' (which is basically what it is) to my day job which does interest me. If anyone can further explain that in greater clarity or the short-term benefits of filing my youtube as a business, that would be very nice. Thank you again Opus17
Let's suppose you have $50,000 in wage income from a W-2 job and a $2000 loss on your side-gig. (For example, $500 of channel income and $2500 of expenses.) Sometimes, you can deduct the business loss from your wages and pay less income tax overall. But I need some other experts to help you understand when this is possible.
Of course, if you have any profit from your side-gig, then you have to report and pay tax no matter how small the profit it. For example, you were paid $2000 and have $1900 of expenses, you still have $100 of taxable income. The $400 threshold only applies to the question of "do I have to file any tax return if my only income is self-employment less than $400.")
