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Self-Employment Tax Calculator
Freelancers, contractors and 1099 workers pay both halves of Social Security and Medicare. Estimate your 2026 self-employment tax, federal income tax and quarterly payments.
How self-employment tax is calculated
- Start with net profit: income minus deductible business expenses (Schedule C).
- Multiply by 92.35%. This mirrors the employer half of payroll tax that an employee never sees.
- Apply 12.4% Social Security on up to $184,500 (less any W-2 wages you also earned) and 2.9% Medicare on everything.
Half of the SE tax is then deducted from your income for income tax purposes. Most sole proprietors can also take the 20% qualified business income (QBI) deduction.
Example: $60,000 net profit, single
$60,000 × 92.35% = $55,410 of SE earnings. Social Security is $6,870.84 and Medicare $1,606.89, so SE tax is $8,477.73. Half of it ($4,238.87) is deductible, leaving AGI of $55,761. After the $16,100 standard deduction and a QBI deduction of about $7,932, taxable income is $31,729 and federal income tax is about $3,559. Total federal tax: about $12,037, or roughly $3,009 per quarter.
Lowering your self-employment taxes legally
- Track every business expense: equipment, software, a home office used only for work, business mileage (or actual vehicle costs), phone and internet share.
- Retirement plans: a SEP-IRA or Solo 401(k) can shelter far more than an employee 401(k), cutting income tax (not SE tax).
- Health insurance premiums for yourself and family are deductible from income if you aren't eligible for an employer plan.
- S corporation election: at higher profits, paying yourself a reasonable salary and taking the rest as distributions can reduce SE tax, at the cost of payroll paperwork.
Frequently asked questions
What is the self-employment tax rate for 2026?
15.3% on 92.35% of your net self-employment earnings: 12.4% for Social Security on up to $184,500 of earnings, and 2.9% for Medicare with no limit. An extra 0.9% Medicare tax applies above $200,000 ($250,000 for married couples).
Do I pay self-employment tax on all my income?
Only on net profit, your business income minus business expenses, and only if net earnings are $400 or more. And you can deduct half of your SE tax when working out your income tax.
When are quarterly estimated taxes due?
Usually April 15, June 15, September 15 and January 15 of the next year. Paying at least 100% of last year's total tax (110% if your income was over $150,000) through the year avoids underpayment penalties.
What is the QBI deduction?
The qualified business income deduction lets many self-employed people deduct up to 20% of their business profit from taxable income. Limits apply at higher incomes, especially for service businesses.