Tackling TikTok, Part 2: Creating an LLC reduces your tax liability

By Scott Hennessy On June 4, 2024
Scott is a CPA & Manager at BSB.


You can create an LLC for your side hustle to “write off” expenses and pay zero in tax!


Merely creating an LLC does not entitle you to any extra tax deductions.

Whether you operate as a sole proprietor or under an LLC, businesses are able to deduct ordinary and necessary expenses.

This requires that the activity be considered a bona fide business in the first place.


  • The IRS differentiates between a bona fide business endeavor and a hobby based on various factors, including the following:
    • Activity is carried out in a business-like manner
    • Maintaining complete and accurate books and records.
    • Putting time and effort demonstrating intention to be profitable.
    • Losses are due to circumstances beyond the taxpayer's control or are normal for the startup phase for this type of business.

If you're a taxpayer in the New York Metro Area and need help making the best decisions for tax return, request a consultation with our experienced accountants today. We look forward to providing you service.

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