Do graphic designers who have a fulltime job have to pay a business tax if they do a few freelance projects?

I%26#039;m a graphic designer with a fulltime job and on occasion pick up some freelance projects. I have not done any freelance work in 2007 but did a bout 3 projects in 2006. I recently got a letter saying that I owe a business tax. Am I required to pay this eventhough I don%26#039;t really have a business?|||But you do have a business. It might not be full time, but since you are doing freelance jobs, that%26#039;s having a business and you owe tax on the income.|||You need to add a lot more detail if you want an answer that has any meaning.





Who told you that you owed a business tax? The IRS, or a city entity? Many cities call the license fee and business tax, so is this what you are asking about?





Also, keep in mind, that you owe not only federal, state and possibly local taxes on the money from the freelance projects, but also both the employer and employee side of SS and FICA taxes. Since you will be treated as self employed with respect to the freelance work. (Check for any special rules with regard to the SS and FICA if your total income for all sources is large enough to require special handling.)