A third of Americans turn to side hustles to supplement their income1 pursue new opportunities or build additional income streams alongside their main job. But where you live could make a big difference to how easy it is to get one off the ground.
From taxes and living costs to remote working and access to coworking spaces, some cities offer more favorable conditions for side hustlers than others.
To find out where side hustlers could have the greatest advantage, the team at Sigma Tax Pro ranked the 50 largest U.S. cities across eight working, living and economic factors.
There is no single factor that determines whether a city is a good place to start a side hustle.
Lower living costs can make it easier for additional earnings to stretch further, while shorter commutes and remote working can give people more time and flexibility to pursue work outside their primary job.
Self-employment rates can indicate how established independent working already is in a city, while coworking spaces can provide useful infrastructure for freelancers and small business owners.
Taxes matter too as additional income can have tax implications, and state income tax rates vary considerably depending on where someone lives.
When these factors are considered together, some cities offer a much more favorable environment for side hustlers than others. So, which cities come out on top?
Miami, Florida, takes the top spot as the best U.S. city for starting a side hustle, followed by Austin, Texas, and Atlanta, Georgia.
| Rank | City | Index Score | Self-employment Rate | Cost of Living Index | Median Gross Rent | Top State Income Tax Rate | Work From Home Rate | Coworking Spaces per 100,000 | Population Growth (%) | Average Commute |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Miami, FL | 70.46 | 9.97 | 103.414 | $1,975 | 0.00 | 15.68 | 19.60 | 10.76 | 27.49 |
| 2 | Austin, TX | 65.09 | 6.50 | 97.057 | $1,770 | 0.00 | 24.76 | 5.78 | 4.64 | 24.16 |
| 3 | Atlanta, GA | 64.25 | 4.49 | 96.293 | $1,765 | 5.19 | 25.62 | 15.69 | 6.08 | 26.50 |
| 4 | Nashville, TN | 64.04 | 7.52 | 91.870 | $1,669 | 0.00 | 17.97 | 4.44 | 4.59 | 25.23 |
| 5 | Charlotte, NC | 63.74 | 5.31 | 94.326 | $1,720 | 3.99 | 24.99 | 4.15 | 10.30 | 25.32 |
| 6 | Raleigh, NC | 60.22 | 4.15 | 94.326 | $1,661 | 3.99 | 21.78 | 4.35 | 8.16 | 23.03 |
| 7 | Oklahoma City, OK | 59.05 | 6.41 | 87.843 | $1,178 | 4.50 | 10.12 | 0.69 | 5.71 | 21.93 |
| 8 | Columbus, OH | 58.67 | 4.82 | 92.774 | $1,383 | 2.75 | 16.31 | 3.94 | 3.55 | 22.19 |
| 9 | Denver, CO | 58.30 | 5.68 | 103.052 | $1,870 | 4.40 | 24.75 | 11.75 | 3.51 | 24.91 |
| 10 | Tulsa | 58.06 | 5.58 | 87.843 | $1,099 | 4.50 | 10.22 | 3.36 | 0.75 | 19.73 |
| 11 | San Antonio | 57.70 | 6.41 | 97.057 | $1,389 | 0.00 | 11.12 | 1.74 | 8.03 | 25.11 |
| 12 | Tampa | 57.05 | 4.72 | 103.414 | $1,898 | 0.00 | 19.92 | 8.46 | 7.32 | 26.07 |
| 13 | Kansas City | 56.48 | 4.50 | 90.817 | $1,292 | 4.70 | 15.35 | 3.07 | 2.60 | 21.76 |
| 14 | Fort Worth | 56.40 | 6.34 | 97.057 | $1,630 | 0.00 | 10.52 | 1.95 | 11.89 | 28.00 |
| 15 | Las Vegas | 55.76 | 6.88 | 99.979 | $1,688 | 0.00 | 12.17 | 6.91 | 5.27 | 26.64 |
| 16 | Dallas | 55.38 | 6.07 | 97.057 | $1,599 | 0.00 | 13.55 | 7.00 | 1.93 | 26.76 |
| 17 | Louisville | 55.10 | 4.94 | 90.159 | $1,144 | 3.50 | 12.24 | 2.03 | 1.59 | 23.71 |
| 18 | Houston | 55.03 | 6.62 | 97.057 | $1,408 | 0.00 | 10.90 | 4.55 | 4.25 | 28.25 |
| 19 | Detroit | 53.30 | 6.33 | 96.217 | $1,091 | 4.25 | 9.81 | 3.39 | 1.49 | 22.87 |
| 20 | Omaha | 53.01 | 3.88 | 90.103 | $1,229 | 4.55 | 12.31 | 2.66 | -0.62 | 19.96 |
Swipe horizontally on smaller screens to view all columns.
Swipe horizontally on smaller screens to view all columns.
Score: 70.46 out of 100
Miami takes the crown as the best U.S. city for starting a side hustle. A high self-employment rate, strong population growth and Florida’s lack of state individual income tax help the city overcome its relatively high living costs.
Score: 65.09 out of 100
Austin takes second place, combining a strong remote-working culture with the tax advantages of living in Texas. Almost a quarter of residents work from home, giving the city particularly favorable conditions for flexible and additional work.
Score: 64.25 out of 100
Atlanta ranks third and stands out as a particularly strong city for remote and flexible workers. It has the highest work-from-home rate in the top 10, alongside one of the highest concentrations of coworking spaces.
At the other end of the ranking, San Jose, California, is the worst U.S. city for starting a side hustle, followed by New York and Long Beach, California.
| Rank | City | Index Score | Self-employment Rate | Cost of Living Index | Median Gross Rent | Top State Income Tax Rate | Work From Home Rate | Coworking Spaces per 100,000 | Population Growth (%) | Average Commute |
|---|---|---|---|---|---|---|---|---|---|---|
| 50 | San Jose, CA | 16.87 | 4.70 | 110.720 | $2,674 | 13.30 | 12.80 | 1.72 | -2.32 | 28.66 |
| 49 | New York, NY | 21.46 | 6.10 | 107.921 | $1,811 | 10.90 | 12.53 | 0.83 | -2.51 | 40.59 |
| 48 | Long Beach, CA | 25.29 | 7.15 | 110.720 | $1,962 | 13.30 | 13.83 | 2.89 | -3.49 | 31.22 |
| 47 | San Francisco, CA | 27.79 | 6.48 | 110.720 | $2,448 | 13.30 | 21.42 | 9.56 | -5.97 | 32.15 |
| 46 | Bakersfield, CA | 30.16 | 5.71 | 110.720 | $1,708 | 13.30 | 8.00 | 0.71 | 4.40 | 22.87 |
| 45 | Boston, MA | 31.37 | 4.05 | 105.757 | $2,196 | 9.00 | 15.49 | 7.73 | -0.83 | 31.67 |
| 44 | Fresno, CA | 31.47 | 6.45 | 110.720 | $1,552 | 13.30 | 8.90 | 0.54 | 2.46 | 23.15 |
| 43 | San Diego, CA | 32.56 | 6.57 | 110.720 | $2,414 | 13.30 | 17.96 | 4.41 | 1.56 | 24.05 |
| 42 | Oakland, CA | 34.27 | 8.75 | 110.720 | $2,008 | 13.30 | 19.59 | 3.63 | 0.00 | 31.24 |
| 41 | Los Angeles, CA | 34.72 | 11.07 | 110.720 | $1,958 | 13.30 | 16.04 | 3.23 | -0.78 | 31.68 |
| 40 | Sacramento, ca | 34.81 | 5.71 | 110.720 | $1,846 | 13.30 | 16.19 | 5.41 | 2.20 | 25.25 |
| 39 | Baltimore, MD | 36.84 | 4.44 | 104.959 | $1,345 | 6.50 | 13.99 | 2.98 | -2.69 | 30.16 |
| 38 | Virginia Beach, VA | 38.57 | 4.51 | 101.104 | $1,753 | 5.75 | 12.13 | 1.54 | -1.24 | 24.81 |
| 37 | Washington, DC | 38.76 | 4.24 | 109.901 | $1,931 | 10.75 | 22.86 | 11.53 | 0.59 | 31.01 |
| 36 | Philadelphia, PA | 42.19 | 4.53 | 97.572 | $1,500 | 3.07 | 14.36 | 3.18 | -1.84 | 33.18 |
| 35 | Aurora, CO | 42.60 | 4.83 | 103.052 | $1,932 | 4.40 | 15.96 | 0.73 | 6.16 | 29.07 |
| 34 | Milwaukee, WI | 43.20 | 2.94 | 94.095 | $1,081 | 7.65 | 10.85 | 1.96 | -2.68 | 22.51 |
| 33 | Chicago, IL | 43.52 | 4.79 | 99.958 | $1,486 | 4.95 | 17.59 | 4.72 | -0.61 | 33.51 |
| 32 | Seattle, WA | 46.74 | 5.53 | 107.013 | $2,007 | 9.90 | 24.37 | 5.48 | 6.47 | 25.95 |
| 31 | Colorado Springs, CO | 47.38 | 5.19 | 103.052 | $1,699 | 4.40 | 15.20 | 3.23 | 3.08 | 23.33 |
Swipe horizontally on smaller screens to view all columns.
Score: 16.87 out of 100
San Jose ranks as the worst U.S. city for starting a side hustle. High living costs, the highest median rent in the bottom 10 and California’s 13.3% top state income tax rate contribute to its low score, alongside negative population growth.
Score: 21.46 out of 100
New York ranks second from bottom, with high living costs and a 10.9% top state income tax rate weighing on its score. The city also has an average commute of more than 40 minutes, the longest among the cities at either end of the ranking.
Score: 25.29 out of 100
Long Beach takes 48th place, with high living costs, a median monthly rent of $1,962 and California’s 13.3% top state income tax rate contributing to its position near the
bottom of the ranking.
_
Overall, the research shows that location can play a significant role in how favourable the conditions are for starting a side hustle. However, wherever you live, understanding the financial and tax implications of earning additional income is important if you want to turn it into a sustainable source of income.
Reporting side hustle income can be confusing. In fact, our recent research found that 22% of Americans find reporting additional income confusing, while a further 22% are unsure what qualifies as taxable income.
If you are unsure about your tax obligations, consider speaking to a tax professional. They can help ensure you do not pay more tax than necessary or underreport your income, which could cause issues further down the line.
The 50 largest U.S. cities by 2025 population were ranked across eight equally weighted factors: self-employment rate, cost of living, median rent, state income tax, work-from-home rate, coworking spaces per 100,000 people, population growth and average commute time.
Each factor was scored from 0–100, with higher scores representing more favourable conditions, before being averaged to create the final ranking.
Ranking sources: U.S. Census Bureau 2024 ACS 1-Year Estimates and 2025 Population Estimates; U.S. Bureau of Economic Analysis/FRED 2024 Regional Price Parities; 2026 state income tax rates; and Coworker city-directory listings (collected July 26, 2026).
Other sources:
