Self-Employment Tax Calculator
If you earn $400+ from freelance, gig, or 1099 work, you owe self-employment tax on top of income tax. This calculator estimates your SE tax, income tax, and what to set aside quarterly.
What Is Self-Employment Tax?
Self-employment tax funds Social Security and Medicare for self-employed workers. It replaces the FICA tax that employers split with W-2 employees.
| Tax | Rate | Wage Base (2026) |
|---|---|---|
| Social Security | 12.4% | $168,600 |
| Medicare | 2.9% | No cap |
| Additional Medicare | 0.9% | Over $200k/$250k |
You pay the full 15.3% as a self-employed worker, but you can deduct half from your taxable income.
The Self-Employment Tax Formula
The 92.35% adjustment accounts for the fact that you can deduct half of SE tax.
Worked Example: $60,000 Freelance Income
- Net profit: $60,000
- Taxable base: $60,000 × 0.9235 = $55,410
- SE tax: $55,410 × 0.153 = $8,478
- Half SE tax deduction: $4,239
- Adjusted gross income: $55,761
- Federal income tax (22% bracket): ~$6,300
- Total tax bill: ~$14,778
- Effective rate: 24.6%
Quarterly Estimated Payments
Self-employed workers pay taxes quarterly using Form 1040-ES. Due dates:
- April 15 - Q1 income
- June 15 - Q2 income
- September 15 - Q3 income
- January 15 - Q4 income
How to Reduce Self-Employment Tax
- Deduct business expenses (home office, supplies, mileage, software)
- Contribute to a SEP-IRA or Solo 401(k) - up to $69,000 in 2026
- Use an HSA if eligible
- Claim the Qualified Business Income (QBI) deduction - up to 20%
- Hire your spouse or kids (in some cases)
- Set up an S-Corp to reduce SE tax (advanced)
Frequently Asked Questions
Do I owe SE tax if I have a W-2 job too?
Yes - if you earn $400+ net from self-employment, you owe SE tax on that income even with a W-2 job.
What is the SE tax rate for 2026?
15.3% on net earnings up to $168,600, then 2.9% Medicare + 0.9% Additional Medicare above that.
Can I deduct my health insurance?
Yes - self-employed health insurance premiums are 100% deductible above-the-line.
What is the QBI deduction?
A 20% deduction on qualified business income for pass-through entities. Phase-outs apply at high incomes.
Do I need an LLC to file self-employment taxes?
No - you file SE tax on Schedule SE regardless of entity type. An LLC is for legal, not tax, purposes.
Should I form an S-Corp?
Sometimes - if you earn $80,000+ net and can pay yourself a reasonable salary. Talk to a CPA first.