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Are you eligible for a business credit card?
You may think only people with a registered business (LLC, S Corp, etc) are eligible for business cards, but actually, most side hustles qualify for business credit cards.
Some examples of what could qualify:
– dog walker, petsitter
– selling on eBay, Facebook marketplace, etsy
– tutoring, coaching, music/language lessons
– snow removal/yard work/lawn services
– baking business
– driving for uber/lyft
– craft business
Why would you want a business credit card?
Chase has the 5/24 rule that says that if you get 5 credit cards in 24 months (from ANY issuer) you can’t get any more credit cards from Chase (personal or business) until you are under the 24 month mark.
BUT (most*) business cards don’t count as part of that 5.
So the best way to stay under 5/24?
Apply for business cards between your personal card applications.
Also, business cards typically do not appear on your personal credit report.
EXACTLY how to fill out a business credit card application for your side hustle
Name of business & business name for card & mailing address – your name & your address
Tax ID number – you social security number if you don’t have an EIN
Type of business – sole proprietorship
Business category, Number of employees, Years in business – answer honestly
Authorizing officer – owner
Gross annual income – your combined household income + what your side hustle brings in
After you submit your application, you may get instantly approved or you may get a screen that says they will get back to you.
Don’t let a “we’ll get back to you” worry you. I have gotten this screen every time and then receive approval within a week or so.
REAL LIFE EXAMPLE
I do have a business with an EIN I’ve had for 15 years… however…
I have also been able to get business credit cards for my “side hustle” – selling on Facebook Marketplace.
On the application, I answered all questions honestly… I only sell about $2K a year doing this. Tiny side hustles CAN still qualify for business cards.
BUSINESS CREDIT CARDS FAQS
- Will I have to report my business credit card to the IRS?
No, there is no connection between your card and IRS.
- I sell/make very little with my side hustle, how can I qualify?
If you think about it, most businesses will apply for a business credit card before they have any income at all. When you are starting a brand new business, you often open a specific credit card for that business and a business checking account before you have any sales at all (to simplify finances with your accountant).
- Should I make up a name for my business? How does this work?
NO, definitely don’t make up a fictitious name if you are a sole proprietor. It’s super important to fill out all the application as specified above.
** The exception: Discover business cards & certain Capital One small business cards DO count against your 5/24
Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.