Nothing kills side hustle momentum like a tax bill you didn’t see coming. Here’s what to understand before the IRS makes it interesting for you. Self-employment income is taxed differently. When you’re an employee, your employer splits FICA taxes with you. When you’re self-employed, you pay both sides — currently around 15.3% on net self-employment income, on top of your regular income tax. This surprises a lot of first-year side hustlers badly.