There has never been a better time to start your side hustle or small business

There has never been a better time to start your side hustle or your small business. Fortune favors the bold, and I believe the age of AI is going to be owned by the people who dare to dream, and by the people and tools that help them turn those dreams into something real.

Americans already know it. There are about 36.2 million small businesses in the United States, employing almost half of the private-sector workforce, and Texas has more than 3.5 million of them. Business applications hit about 5.7 million in 2025, which one analysis of Census data counts as an all-time high. The question is no longer whether ordinary working people can start something. It is whether they will do it well.

Contrary to popular opinion, the tax code wants you to succeed

Most people think of the IRS as an obstacle. But the IRS administers a tax code that Congress has written, over and over, to reward people who build businesses. If you run it like a real business, the code is on your side:

• A 20 percent deduction on business income. The qualified business income deduction lets many owners of sole proprietorships, LLCs, partnerships, and S corporations deduct up to 20 percent of their qualified business income. In 2025 it was made permanent, with a new minimum deduction for owners with at least $1,000 of qualified income from a business they actively run.
• Write off equipment right away. Section 179 now lets businesses expense up to $2.5 million of qualifying equipment and software in the year it is placed in service, indexed for inflation, and 100 percent bonus depreciation is back permanently for property acquired after January 19, 2025. The laptop, the camera, the truck used for the business, the software: much of it can be deducted in year one instead of over many years.
• Start-up costs count. You can generally deduct up to $5,000 of start-up costs and $5,000 of organizational costs in your first year, and amortize the rest.
• Your home office. If part of your home is used regularly and exclusively for the business, you can deduct it, including through a simplified method of $5 per square foot for up to 300 square feet.
• Health insurance. Self-employed people can generally deduct health insurance premiums for themselves and their families.
• Retirement savings. A solo 401(k) lets a one-person business save up to $24,500 as the employee in 2026, plus employer contributions, up to $72,000 in total before catch-up contributions. Few W-2 jobs offer anything like it.
• Research and development. Domestic research and experimental costs can again be deducted immediately, and small businesses can even reach back to recover costs they had to capitalize from 2022 through 2024.
• Hiring your kids. A sole proprietor who pays their children under 18 for real work at a reasonable wage can generally deduct the pay, and it is exempt from Social Security and Medicare tax.
• Texas helps too. Texas has no personal income tax, and most small businesses owe no franchise tax at all, because the no-tax-due threshold is millions of dollars in revenue.

The catch is the one that matters most: you have to prove it. Deductions are the taxpayer’s burden. Travel, vehicles, and gifts need contemporaneous records under the tax code. And whether your venture is a business or a hobby turns on factors like whether you carry it on in a businesslike manner and keep complete and accurate books. The tax code rewards businesses. It does not reward shoeboxes.

Your new chief of staff

This is where 2026 is different from every year before it. For the first time, an ordinary person with a day job can have something like a personal assistant and a chief of staff. Always-on AI agents, such as xAI’s Grok Bot, OpenAI’s Dots, Meta’s Muse, Perplexity Computer, and open-source agents like Nous Research’s Hermes, can now work in the background on your behalf.

Used well, they can do the work that used to sink small businesses:

• Keep the books honest. Capture every receipt, categorize expenses as they happen, and keep a mileage log as you drive, the contemporaneous records that win an audit.
• Organize your documents. Contracts, invoices, licenses, insurance certificates, and tax filings, named and filed where you can find them in seconds.
• Watch the calendar. Quarterly estimated taxes, the annual Texas franchise tax information report, license renewals, and contract deadlines.
• Generate sales leads. Research prospects, draft outreach, follow up, and keep your pipeline moving while you do the actual work.

That is a real advantage. A one-person business with good tools can now look and operate like a company with staff.

But know this before you take the step: compliance risk has also increased

The same tools that make it easier to start also make it easier to get something wrong at scale. Before you launch, know where the traps are:

• Your day job. Check your employment agreement and handbook for moonlighting rules, invention assignment clauses, confidentiality obligations, and non-competes. A side business built on your employer’s time, equipment, customers, or confidential information can cost you both. See conflicts of interest and non-competes and trade secrets.
• The right structure and filings. A sole proprietorship using a business name needs an assumed name certificate. An LLC needs a certificate of formation, a company agreement, and an annual information report to the Texas Comptroller even when no tax is due, or it can forfeit its right to do business. Selling taxable goods or services, including many digital products, may require a Texas sales tax permit.
• Self-employment and estimated taxes. Self-employment tax runs about 15.3 percent on net earnings up to the Social Security wage base, and estimated taxes are due quarterly. Reporting thresholds changed again in 2026: Forms 1099-NEC and 1099-MISC now generally start at $2,000, and Form 1099-K at $20,000 and 200 transactions, but every dollar of income is still taxable whether or not you get a form.
• Workers. The moment you pay someone, you have to decide whether they are an employee or a contractor, and getting it wrong is expensive. See worker classification.
• AI-powered outreach. Federal regulators treat AI-generated voices as “artificial” voices under the Telephone Consumer Protection Act, which generally requires prior consent for those calls. Marketing email has its own rules, and the FTC prohibits fake reviews and testimonials, including AI-written ones. Lead generation that ignores these rules can create liability faster than it creates sales.
• Your agent acts for you. Texas law generally recognizes contracts formed by electronic agents, so an assistant that accepts terms, sends a quote, or signs up for a service can bind you. Review what it is allowed to do on its own.
• Data and privacy. Customer information you put into AI tools may be stored, shared, or used under terms you never read. Texas privacy law and, since January 2026, Texas’s AI law add their own rules for some uses.
• Who owns the work. Courts have held that copyright requires human authorship. If your product, logo, or content is generated entirely by AI, you may not own it the way you think you do.

How Crawford Law can help

Crawford Law can help you navigate this labyrinth efficiently and effectively. That means choosing the right structure, writing a company agreement and customer contracts that fit, checking your side business against your day-job obligations, setting up contractor and employee relationships correctly, and reviewing your AI-assisted marketing before it goes out. Work is quoted up front in fixed blocks, so the cost of starting right is known before you start. See the business practice.

The firm can also connect you with professional financial and accounting help for the tax side of your journey. The firm does not accept referral fees from accountants or advisors. The point is to get you to the right people.

Fortune favors the bold. It also favors the prepared. Ask for a free consult.