How can one create hanging indent within text?

You can use TextCell with the option ParagraphIndent

TextCell[StringTake[ExampleData[{"Text", "DeclarationOfIndependence"}], 900], "Text", 
 ParagraphIndent -> -40]

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or Style with the option LineIndent:

Style[StringTake[ExampleData[{"Text", "DeclarationOfIndependence"}], 900], "Text", LineIndent->2]

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