The internet has opened up countless opportunities for people to make money online, whether you’re looking for a side hustle or a full-time remote gig. With low startup costs and flexible hours, it’s no wonder that more Americans—especially first-time earners—are exploring ways to earn extra income from home.
But before you get started, it’s important to understand how online income works, where to find legit opportunities, and what it means for your taxes. Here’s your complete guide to getting started.
1. Freelancing Your Skills
If you have marketable skills, freelancing is one of the fastest ways to start earning online. Platforms like Upwork, Fiverr, and Freelancer.com connect clients with freelancers in areas like:
- Writing and editing
- Graphic design
- Web development
- Virtual assistance
- Social media management
You set your own rates and choose the projects you want to work on. While competition can be fierce at first, building a strong profile and collecting good reviews can lead to consistent work and higher-paying gigs.
Pro tip: Keep track of every payment and invoice—freelance income is taxable!
2. Selling Products Online
Selling items online can be incredibly rewarding—whether you’re creating handmade goods or reselling thrift store finds. Options include:
- Etsy – perfect for handmade or digital items
- eBay – great for vintage, collectibles, or used goods
- Amazon FBA – lets you sell and ship products through Amazon’s network
- Shopify – build your own online store
You can also try print-on-demand services like Redbubble or Printful, which let you design products without holding inventory.
Be sure to track your product costs, shipping fees, and platform charges—they can affect your taxable income and deductions.
3. Affiliate Marketing
With affiliate marketing, you earn a commission every time someone buys a product or service using your unique referral link. It’s a popular income stream for:
- Bloggers
- YouTubers
- Influencers
- Niche website owners
Popular affiliate programs include Amazon Associates and CJ Affiliate. You don’t need to create your own product, just promote existing ones.
Even passive affiliate income is considered taxable. So, keep records of payments from affiliate platforms.
4. Content Creation (YouTube, TikTok, Blogging)
If you enjoy entertaining, teaching, or sharing your life online, content creation might be for you. You can make money through:
- Ad revenue (YouTube Partner Program, TikTok Creator Fund)
- Sponsored posts and brand deals
- Selling merchandise or digital products
- Offering subscriptions (Patreon, Substack)
Building an audience takes time, but successful creators can earn thousands per month.
Taxes apply to all revenue streams, even freebies and brand gifts. Keep everything documented for tax season.
Read More: Tax Tips for Content Creators
5. Online Surveys, Testing & Microtasks
Looking for low-commitment ways to earn a few extra dollars? Try:
- Swagbucks – earn points for surveys, videos, and tasks
- UserTesting – get paid to test websites and apps
- Amazon Mechanical Turk – complete small data-entry or categorization tasks
These won’t make you rich, but they’re legit and beginner-friendly.
If you earn more than $600 from any platform, they’ll likely send you a 1099 form, and the IRS expects you to report that income.
6. Remote Part-Time Jobs and Gigs
More companies now hire remote workers for part-time roles like:
- Customer service
- Data entry
- Transcription
- Tech support
Check job boards like FlexJobs, Remote.co, and We Work Remotely for legitimate listings. Avoid red flags like upfront payments or vague job descriptions, they’re likely scams.
Even W-2 remote jobs may involve state-specific tax rules if you’re working across state lines. Always check your withholding.
7. Tax Implications of Making Money Online
No matter how small your online income is, the IRS wants to know about it. Here’s what you need to know:
Online income is taxable
Whether you’re freelancing, selling crafts, or earning ad revenue, the IRS considers it taxable income, even if you don’t receive a 1099.
Self-employment taxes apply
If you’re working as a freelancer or independent contractor, you’re responsible for self-employment tax (Social Security + Medicare), which is typically 15.3% in addition to income tax.
You can deduct business expenses
You may be able to write off:
- Home office space
- Internet and phone bills
- Supplies and software
- Marketing expenses
Just be sure to keep detailed records and receipts.
File taxes accurately and on time
Need to report side income? Use ezTaxReturn to file your taxes fast and correctly—even if you’re self-employed or received a 1099 form.
Conclusion: Making Money Online Is Real—But Don’t Forget the Tax Side
There are plenty of legitimate ways to make money online, from freelancing and selling products to blogging and affiliate marketing. But with that freedom comes responsibility—especially when it’s time to file your taxes.
Here’s what to remember:
- Track every dollar you earn
- Set aside money for taxes (aim for 25–30%)
- Use ezTaxReturn to file your taxes the fast and easy way
BONUS: Free Download
Top 10 Legit Ways to Make Money Online — Get your free checklist to explore side hustles that fit your skills and lifestyle.
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Frequently Asked Questions: Making Money Online & Taxes
1. What is the easiest way to make money online for beginners?
For beginners, the easiest ways to make money online include taking surveys, freelancing simple tasks (like writing or virtual assistance), or selling items on eBay. These options require minimal upfront investment and are beginner-friendly.
2. Do I have to pay taxes on money I make online?
Yes. Any money you make online—whether through freelancing, selling products, or affiliate income—is considered taxable by the IRS. Even if you don’t receive a 1099 form, you’re still required to report it on your tax return.
3. How much can I earn online before paying taxes?
There’s no minimum threshold for reporting income. If you earn more than $400 in self-employment income, you’re required to file a tax return and pay self-employment tax. For other types of income, you may still owe taxes even below that amount.
4. What platforms are best for first-time online earners?
Great platforms for first-time online earners include:
- Fiverr or Upwork (freelancing)
- Etsy or eBay (selling goods)
- Swagbucks or UserTesting (small tasks and surveys)
These are low-risk ways to explore online income streams.
5. How do I track income from multiple online sources?
Keep a spreadsheet or use accounting software to track:
- Payments received
- Invoices sent
- Business-related expenses
Make sure to save copies of any 1099 forms and receipts. ezTaxReturn makes it easy to report multiple income sources at tax time with our clear step-by-step guidance and 100% accurate calculations.
The articles and content published on this blog are provided for informational purposes only. The information presented is not intended to be, and should not be taken as, legal, financial, or professional advice. Readers are advised to seek appropriate professional guidance and conduct their own due diligence before making any decisions based on the information provided.
