Self-Employment Tax Calculator

What self-employment tax is and who pays it

When you work for someone else, Social Security and Medicare cost 7.65% of your wages and your employer quietly pays a second 7.65%. Work for yourself and you are both sides of that deal, so you pay 15.3%. That combined bill is self-employment tax, and it is separate from income tax.

You owe it once net earnings from self-employment reach $400 in the year. That covers freelancers and consultants, rideshare and delivery drivers, barbers and stylists who rent a chair, online sellers, contractors paid on a 1099-NEC, and anyone running a sole proprietorship. It applies whether the work was a side job or full time, and it applies on top of any W-2 job you held.

The tax has nothing to do with the state you live in and nothing to do with whether you itemize. The standard deduction does not shrink it. This is why a first year of freelancing can produce a bill that surprises people: income tax can be zero while self-employment tax is still several thousand dollars. The IRS lays out the rules on its self-employment tax page.

How the 15.3% splits into Social Security and Medicare

Two parts, with different rules:

• Social Security, 12.4%. This part stops at a yearly cap. In 2026 the cap is $184,500 of combined wages and net earnings, so every dollar above it is free of the 12.4%.
• Medicare, 2.9%. This part has no cap at all. It runs on the first dollar and the four hundred thousandth dollar alike.

On $65,000 of profit the taxed share is $60,027.50, which comes to $7,443.41 for Social Security and $1,740.80 for Medicare, for a total of $9,184.21. The Medicare share is smaller but it never turns off, so at high incomes it becomes the whole story. At $300,000 of profit the Social Security part is stuck at $22,878.00 while the Medicare part has climbed to $8,034.45.

The split also explains why the effective rate falls as income rises. Under the wage base the total is a flat 14.13% of profit, because 15.3% applies to 92.35% of it. Above the cap the Social Security portion stops growing, so $300,000 of profit carries an effective rate of 10.39%. A quarter million dollar earner pays $29,851, not the $45,900 you would get from a flat 15.3% on gross.

The 92.35% rule: the share of profit that gets taxed

The tax is not figured on your full profit. It is figured on 92.35% of it. The reason is that an employer deducts the half of this tax it pays, so trimming 7.65% off the top puts a self-employed person in roughly the same position.

On $65,000 of profit the amount the tax applies to is $60,027.50, which means $4,972.50 of the profit never sees the 15.3%. On $150,000 of profit the taxed share is $138,525.00. The rule is not optional and it is not a deduction you claim, it is built into the way Schedule SE works.

Net profit means income minus ordinary and necessary expenses, the figure that ends up on Schedule C. Mileage, home office, software, supplies and the cost of goods sold all come off first. That is the practical lever you control: a $5,000 expense on $65,000 of profit cuts the tax by about $706, because it is taxed at 14.13% rather than 15.3%.

The 2026 Social Security wage base and where 12.4% stops

The wage base is $184,500 for 2026, up from $176,100 in 2025. The Social Security Administration publishes the figure each autumn and the IRS follows it. You can see the full history on the contribution and benefit base page.

The cap is shared. Wages from a day job count first, and only the room left below $184,500 is open to your self-employment earnings. Say you earned $150,000 in wages and made $65,000 in profit. The taxed share of the profit is $60,027.50, but only $34,500 of it is under the cap, so the Social Security part is $4,278.00 instead of $7,443.41. If your wages already reached $184,500, the Social Security part of your self-employment tax is zero and only the 2.9% Medicare part remains.

Because the cap moves with average wages, the crossover point moves too. Net earnings above about $199,770 in a year with no other wages push past the 2026 cap, since $184,500 is 92.35% of roughly $199,780. That is why the total at $200,000 of profit, $28,234.30, is only about $3,000 more than the total at $184,000.

The 0.9% additional Medicare tax

Above a set threshold, Medicare adds another 0.9%. The threshold depends on how you file:

• Single, head of household, or qualifying widow(er): $200,000
• Married filing jointly: $250,000
• Married filing separately: $125,000

Wages and net earnings from self-employment are added together before the threshold is applied, so a couple with two incomes can cross it even though neither return looks large on its own. On $250,000 of profit with no wages, a single filer has $230,875.00 of net earnings and pays 0.9% on the $30,875 above the threshold, which is $277.88. At $300,000 the same filer pays $693.45.

One trap to know about. An employer only starts withholding the 0.9% once your wages pass $200,000, no matter how you file, so a married joint filer can be under-withheld and owe it at filing time. Self-employed people handle it on their own through estimated payments or by raising W-4 withholding on a spouse's job.

The deduction for one half of your self-employment tax

You deduct half of the tax as an adjustment to income, which means you get it whether or not you itemize. On $65,000 of profit the deduction is $4,592.10. In the 22% bracket that is about $1,010 off your income tax, and in the 12% bracket it is about $551.

The deduction is not the same as a credit. A credit cuts tax dollar for dollar, while this reduces the income that tax is figured on. It also does not reduce the self-employment tax itself, so do not halve your profit before entering it here. Enter the full net profit and let the tool take the half at the end.

Combined with the 92.35% rule, the two adjustments mean the real burden sits near 14.13% of profit below the cap and falls from there, before any income tax is counted. On $150,000 of profit the tax is $21,194.32 and the deduction is $10,597.16, which is a real number to carry into a quarterly payment plan.

Worked examples at eight income levels

These figures assume a single filer with no W-2 wages, so the full wage base is available. Add wages and the Social Security column shrinks.

Two things stand out. Up to roughly $200,000 of profit the total grows in a straight line at 14.13%, and past that point the curve flattens because Social Security stops. The jump from $200,000 to $250,000 adds only $1,616.95 of tax on $50,000 of extra profit.

Half of this tax is the employer share you are covering for yourself, so the fair comparison against a job is 7.65% versus 15.3%. The gap below is the price of being your own boss, before any income tax.

That gap is also the number to keep in mind when you compare a 1099 offer with a W-2 offer. A contract that pays $65,000 leaves $4,211.71 more in payroll tax than a salary of $65,000, so the contract rate needs to be higher to come out even.

Quarterly payments and the 2026 numbers at a glance

Self-employment tax is paid through the year with estimated tax, normally four payments on Form 1040-ES. On $65,000 of profit the tax alone is $2,296.05 a quarter, before income tax is added. Many people square it up a different way: raise the withholding on a W-2 job or a spouse's job using Form W-4, which spreads the catch-up across every paycheck instead of four deadlines. The IRS explains both on its self-employment tax topic page.

Keep the wage base in mind when you plan, because it is the one number here that changes every year. The 15.3% rate has been steady for decades, while the cap has moved from $176,100 to $184,500 in a single year.

This is a planning estimate for federal self-employment tax only. It leaves out income tax, state tax, credits, and any deduction beyond the half of the tax. Confirm the figures with a tax preparer before you file.