Comparison•2025 Tax Year•Last verified: January 2026
California vs Nevada: Side Hustle Tax Comparison 2025
Compare California and Nevada taxes for freelancers and gig workers. Nevada has no state income tax - see how much you could save on your side hustle income.
California and Nevada share a border—but their tax policies couldn't be more different. For side hustlers living in California, Nevada represents one of the closest escapes from the Golden State's high tax burden. Nevada is one of the top three destinations for Californians leaving the state, and the tax savings are a major factor.
California's state income tax ranges from 1% to 13.3%, while Nevada has no state income tax at all. For freelancers and gig workers, this difference can mean thousands of dollars per year—and Nevada is just across the border.
**Why This Comparison Matters:**
Nevada consistently ranks among the top 3 destinations for Californians relocating out of state. The primary drivers include:
- **Zero state income tax**: Nevada has no income tax vs California's up to 13.3%
- **Proximity**: Same time zone, easy to maintain CA client relationships
- **Lower cost of living**: Las Vegas and Reno offer significantly cheaper housing than CA metros
- **Business-friendly**: Nevada has no corporate income tax and minimal business regulations
For side hustlers specifically, moving from California to Nevada can mean keeping an additional 6-13% of your freelance income. And unlike moving to Texas or Florida, you can still easily visit California clients.
Side-by-Side Tax Comparison
| Metric | California | Nevada |
|---|---|---|
| State Income Tax Rate | 1% - 13.3% (progressive) | 0% (no income tax) |
| Common Rate for Side Hustlers | 6% - 9.3% | 0% |
| State Tax Filing Required | Yes (Form 540) | No |
| Federal SE Tax | 15.3% | 15.3% |
| Est. Tax on $18K Side Hustle* | ~$8,179 | ~$6,505 |
| Annual Savings (NV vs CA)* | — | ~$1,674 |
| Property Tax (Avg Rate) | 0.71% | 0.55% |
| Sales Tax (State + Avg Local) | 8.82% | 8.23% |
| Distance from LA | — | ~270 miles (Las Vegas) |
*Assumes single filer with $60,000 W-2 income + $15,000 net side hustle income. Actual taxes vary based on deductions, filing status, and total income.
California Analysis
**California Tax Analysis for Side Hustlers**
California's progressive tax system hits side hustlers hard, especially those with W-2 income pushing them into higher brackets.
**Key California Tax Facts (2025):**
- **Tax Type**: Progressive (9 brackets)
- **Rate Range**: 1% to 13.3%
- **Common Side Hustler Rate**: 6% to 9.3%
- **Mental Health Services Tax**: Additional 1% on income over $1 million
- **No Local Income Tax**: At least CA cities don't add their own
**Example**: If you earn $65,000 from your W-2 job and $18,000 from side hustle income (net of expenses) in California:
- Federal SE Tax: ~$2,545
- Federal Income Tax on side income: ~$3,960
- California State Tax: ~$1,674
- **Total Tax on Side Hustle: ~$8,179** (45.4% effective rate)
California offers strong consumer protections and access to major tech hubs, but for remote workers, these benefits may not justify the premium.
Nevada Analysis
**Nevada Tax Analysis for Side Hustlers**
Nevada is one of nine states with no state income tax, making it extremely attractive for California freelancers looking to reduce their tax burden without moving far.
**Key Nevada Tax Facts (2025):**
- **State Income Tax**: 0%
- **Tax Type**: None
- **Filing Requirement**: No state income tax return required
- **Commerce Tax**: Only applies to businesses with Nevada gross revenue over $4 million
**Example**: Same scenario—$65,000 W-2 job and $18,000 from side hustle income (net of expenses) in Nevada:
- Federal SE Tax: ~$2,545
- Federal Income Tax on side income: ~$3,960
- Nevada State Tax: $0
- **Total Tax on Side Hustle: ~$6,505** (36.1% effective rate)
**Savings vs California: ~$1,674/year** on $18,000 of side hustle income.
Nevada's trade-offs include higher sales taxes (up to 8.375% in Clark County/Las Vegas), no state services funded by income tax, and extreme summer heat in the Las Vegas area.
Calculate Your Side Hustle Taxes
Use our calculator to see exactly what you'd owe in each state. Try entering your numbers, then switch between California and Nevada to compare.
Which State Is Right for Your Side Hustle?
**California May Be Better If You:**
- Need to be physically present in CA frequently for clients
- Work in industries centered in SF or LA (tech, entertainment)
- Value California's employee/contractor protections
- Own property with Prop 13 protection (lower assessed value)
- Have children in CA public schools you don't want to disrupt
**Nevada May Be Better If You:**
- Work remotely with location-independent clients
- Want to eliminate state income tax while staying close to CA
- Are willing to relocate to Las Vegas or Reno area
- Value lower overall cost of living
- Don't mind the desert climate
**Important Considerations:**
1. **California audits aggressively**: The Franchise Tax Board actively pursues former residents. You must genuinely relocate—not just rent a Nevada mailbox. Spending significant time in CA, keeping a CA residence, or maintaining CA professional licenses can trigger continued CA tax liability.
2. **Proximity is a double-edged sword**: Being close to CA makes it easy to visit clients—but also easier for CA to argue you haven't truly left. Document your Nevada presence carefully.
3. **Las Vegas vs Reno**: Reno is closer to the Bay Area (~4 hours), while Las Vegas is closer to LA (~4 hours). Consider which client base you need to access.
4. **Gaming industry**: Nevada's economy is heavily tied to hospitality and gaming. If that industry struggles, services and infrastructure can be affected.
5. **Extreme weather**: Las Vegas summer temperatures regularly exceed 110°F. Reno has cold winters. Factor in lifestyle preferences.
Frequently Asked Questions
How much will I save moving from California to Nevada for my side hustle?
Savings depend on your income level. For a typical side hustler earning $15,000-$25,000 annually in self-employment income, you could save $1,400-$2,300 per year in state taxes by living in Nevada instead of California. Higher earners save even more due to CA's progressive rates.
Can I live in Nevada but keep my California clients?
Yes, absolutely. As a Nevada resident, you pay Nevada taxes (zero income tax) regardless of where your clients are located. You can serve California clients remotely from Nevada without owing California income tax—as long as you're genuinely a Nevada resident and the work is performed in Nevada.
Will California audit me if I move to Nevada?
Possibly. California's Franchise Tax Board is known for auditing former residents, especially high earners. To protect yourself: establish genuine Nevada residency (driver's license, voter registration, car registration), spend the majority of your time in Nevada, and don't maintain a California residence. Keep records proving your Nevada presence.
Related Comparisons
Sources
- • California Franchise Tax Board - 2025 Tax Rates
- • Nevada Department of Taxation
- • IRS Publication 334 - Tax Guide for Small Business
- • US Census Bureau - State-to-State Migration Flows
- • Tax Foundation - State Tax Data 2025