How to Use Your Tax Refund to Scale (or Start) Your Own Online Business

Hello! Today, I have a great blog post about how to use your tax refund from my friend Jeff. Jeff began his career at a private wealth management firm, but now runs two blogs full time. Between VTX Capital and Breaking The One Percent, he’s dedicated to helping millennials and young entrepreneurs grow their online businesses…

Michelle Schroeder-Gardner

Last Updated: June 5, 2023

Disclosure: This post may contain affiliate links, meaning if you decide to make a purchase via my links, I may earn a commission at no additional cost to you. See my disclosure for more info.

Hello! Today, I have a great blog post about how to use your tax refund from my friend Jeff. Jeff began his career at a private wealth management firm, but now runs two blogs full time. Between VTX Capital and Breaking The One Percent, he’s dedicated to helping millennials and young entrepreneurs grow their online businesses and dominate their personal finances. 

June 2018 Update: At the end of 2017, Jeff and Ben rebranded VTX into a more “blog friendly” name, If you are looking for their latest content on making and saving extra money, that’s where you can find them!

How do you plan on using your tax refund this year? Have you thought about starting an online business with it? Yes, this is a great idea!Each year when tax season rolls around, I like to take a step back and look at the Big Picture when it comes to my personal finances.  Most years, I end up getting somewhere between $500-$2,000 back from the IRS.

Usually, I put a little bit of that towards my student loan debt, throw some money in my IRA, or just cushion my emergency savings a bit.  And of course I’ll occasionally splurge on a fun toy.

Hey, I’m human.

But in 2014, I decided to do something different with my tax refund.

I decided to make the biggest investment of all, and put the money towards starting my own online business.


I had only been working for “The Man” for two years, but I could already feel myself growing tired of the idea of working for somebody else.  Maybe it was the dysfunctional office politics of a small business, or perhaps my own ego that made me think I could do better on my own, but I knew deep down that entrepreneurship was the end goal for me.

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It was an itch that was growing stronger with each passing month.  I knew I had to find a way out from my 9-5.

The thing was, I actually liked the type of work I was doing.  I worked for a financial advisor, and I was pretty quickly moving up the ranks.  I really enjoyed being able to help clients with investing their money and planning for their retirement.

But one thing I really didn’t like about my job, though, was the amount of face to face schmoozing I had to do with clients and prospects.   I hated the constant demand to get more assets in the door, even if it meant selling your soul to do it.

I knew that if I wanted to do business on my own, I was going to need a totally different strategy.

That’s when I started researching successful online businesses.


The Blogging Business Model

At first, I had never really considered blogging as a viable alternative to my day job.  I was a finance guy, not a “blogger”.

The problem was, at the time I was completely unaware at the time of how the whole blogging business model even worked.  Sure, I was a regular reader of several financial websites, but until I looked at them from a “business” lens (and not just as someone who enjoyed reading articles) I never really understood how blogs could make money.

Then I discovered what “Income Reports” were.  I saw that many bloggers were making crazy amounts of money.  And they were reaching tens and even hundreds of thousands of readers each month.

I was completely hooked on the concept.

With a blog, I knew it was possible for me to:

Help people at scale…

Have flexibility to deliver help in a way I was naturally better at (writing awesome content)…

Not have to deal with the constant pressure of drumming up new clients…

Potentially make more money than working a corporate job.

Of course, I knew it wouldn’t be easy.  I vividly remember reading about how most bloggers don’t end up making any money at all and never “make it big.”

I was going to try, though. Between affiliate marketing, display advertising, offering 1 on 1 services, and more, I knew there were plenty of opportunities to make money blogging.


My Tax Refund in 2014 Was Exactly $800

I had already been saving up for my “escape” from corporate life for quite some time, but for some reason this cash infusion that year had me extra motivated to get serious about putting my plan into motion.

Since I already had saved up enough to go almost an entire year without income, I decided to deploy this extra money towards actually getting my business started.

Here’s the breakdown of how I spent my money (I didn’t end up spending all $800), and the advice I would give someone that’s looking to set up the foundation for an online business, while still being employed at their 9 to 5.


Domain Name and Hosting for 1 year: ~$100

In order to have a website, you obviously need a name for it.

Since I had planned to initially focus a lot on offering 1 on 1 services and membership packages through my site, I wanted to go with a more “formal” sounding website and business name. Ben (my friend and business partner) and I ended up going with the name VTX Capital for our business. Looking back two years later, I wish we would have chosen a more blog-sounding name, but that’s okay.

Some tips for choosing your domain name:

  • Stick to just .com endings.  Don’t bother using .biz, .info, .org, or any other endings.
  • Make your domain name simple and easy to remember.
  • Leave out numbers and dashes and anything else other than letters.

When you go to buy your domain and hosting, you don’t need to pay as much up front as we did.  Since we knew we were willing to commit to at least a year in blogging and online business, Ben and I chose the lengthier package in order to save money.


WordPress Theme: $50

I will never understand how these are as cheap as they are, but I’m not complaining.  A “theme” is basically just a general design for your blog.  That means you don’t actually need to know anything about coding or web design in order to get started with your blog, which is huge. Without a decent theme, your blog will basically be a wall of text that no one wants to read.

There are a lot of free themes out there, but I think you’re much better off making the small investment in a paid theme. Our theme was only $50 dollars, and gave our site a much more professional look than if we had gone with  a free theme.

See what I mean:


How you present yourself goes a long way towards establishing credibility with your readers, which is why we decided to go with a paid theme. It’s infinitely better than anything we could have designed ourselves, so for 50 bucks it was a steal.


LLC Registration Fees: $100

You’ll hear differing opinions about when you should officially set up your blog as a business entity, depending on who you ask.

Ben and I wanted to do everything “by the book” when we got started, so we registered VTX Capital as a Limited Liability Company (LLC) in Virginia long before we even started pulling in an income from our site.  Sure, it meant shelling out $100 early on in the process, but we knew we were serious about pursuing this and wanted to do it the right way.

I’m not a legal expert by any means, which is part of the reason why we wanted to file and make us as “legit” as possible from early on.  We wanted to make sure our bases were covered.

Disclaimer: You should consult a lawyer with any questions you have about setting up your blog as a business. 

Related read: Blogging and Taxes – What You Need To Know


Lawyer Fees for Reviewing Our Operating Agreement: $200

You most likely do NOT need to go this far if you are just starting out.  We could have waited, but I don’t regret getting this out of the way early.

An operating agreement is an agreement among limited liability company (LLC) members (me and Ben) which governs the LLC’s business, and each member’s financial and managerial rights and duties.  This was important for Ben and I to do since a) this wasn’t a 1 man operation, and b) I was doing more of the work at the beginning and Ben was fronting our ongoing expenses.

Again, we just wanted to be safe and have a lawyer review everything to make sure there wouldn’t be any surprises later. The way we looked at it, it was easier to get it done at the beginning BEFORE there was a lot of money (and therefore emotions) involved.


Total Cost For *Us* to Start an Online Business: $450

Again, you can get away with spending MUCH less.  I knew from the get-go that our online business was going to be a long term project, so that’s how Ben and I treated it.

If you are first just looking to start a blog to make some money on the side, you can start by just purchasing your domain, hosting, and (ideally) a paid theme.  Everyone’s online business journey is different and unique, so take things at your own pace and do what feels right for you.


Fast Forward to Now

Starting an online business was the best decision that I have ever made.  Life is good.

After putting my tax refund money towards getting things set up, then spending a few months writing/learning/social media-ing, I finally took the leap from my 9 to 5 on August 1, 2014.

Since then, there have been many ups and downs, and a LOT of trial and error.  Our business model has shifted from primarily 1 on 1 client work to now a heavier focus on promoting affiliate products and developing other passive (and scaleable) income streams. I really like where our business is headed, and I couldn’t be happier.

When Ben and I first started, I went many months wondering if I had made the right decision to quit my steady paying job, but eventually everything started to finally click.  I stuck with it and kept learning something new every day, and eventually our income started to reflect the work we were putting in.

I now earn enough from my online business to live comfortably, and the best part is- I work for myself! I cannot begin to tell you how liberating it feels to finally be able to say that.  At 27 years old, I can’t imagine myself ever going back to a regular 9 to 5 job.

Although I vastly underestimated how hard entrepreneurship would actually be, I still encourage others to give it a shot.

If you’re tired of what you are doing, it’s up to YOU to make a change!

Since we have learned so much over the past two years about blogging and online entrepreneurship, Ben and I recently launched another blog,  That’s where we share content related to helping other online entrepreneurs grow their businesses (we still sprinkle some personal finance stuff there, too). Between the two sites, we’ve got plenty to keep us busy, but we are loving every minute of it.

How much are you getting back for your tax refund this year? What do you plan on doing with it?

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Michelle Schroeder-Gardner

Author: Michelle Schroeder-Gardner

Hey! I’m Michelle Schroeder-Gardner and I am the founder of Making Sense of Cents. I’m passionate about all things personal finance, side hustles, making extra money, and online businesses. I have been featured in major publications such as Forbes, CNBC, Time, and Business Insider. Learn more here.

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  1. ReachingTheCrest

    Great Breakdown of how you got started. My family has tried to keep those tax returns to a minimum the past few years. I can remember when i first started working and would get that ‘extra’ cash from a refund-it was so easy to do something silly with it. So many people use that refund for some consumer item. Starting an online business with your refund is a great idea!

    1. Thank you! I try to do at least one”smart” thing with my refund each year, even if I splurge a little bit on fun stuff ๐Ÿ™‚

  2. I recently wrote a series of posts on how moms can use their tax refund to start a home business. Nowadays it’s important to have a side hustle because employment is more uncertain. Plus, many stay at home moms experience depression when they don’t have an income of their own. Starting a business allows a woman to use her talents and creativity and benefit herself and her family financially.

    1. Yes! Starting an online business was one of the best decisions I’ve ever made.

  3. Bart

    I decided to give blogging a shot almost 6 months ago. A friend talked me into putting my law enforcement experience into tips for personal and family safety. I have learned a lot in just the short time I’ve been at it and it has changed my life. I have just recently started affiliate marketing and am hopeful that it will be a success.

    Maybe one day I will get a chance to guest post on Michelle’s site!

  4. Kate

    This was so helpful! We, too, would like to start our blogging journey and do things by the book.

  5. I just left a blog comment on Chonce’s blog about spending your tax refund money wisely. I said pretty much in so many words that instead of splurging on tax refund money and going to let’s say somewhere like Tanger outlets and shopping for brand name clothes at a discount, you could take a small portion of tax refund funds and try your hand at PPC ad services like Microsoft Bing PPC advertising or Google AdWords and advertise your affiliate links by cloaking them in a sub-domain name. This would not only help bloggers improve affiliate revenue potential, but also site traffic, lower site bounce rates, and acknowledgement altogether.