Self-Employment Tax Calculator (2025–2026)
What self-employment tax is, in one paragraph
When you have a regular job, Social Security and Medicare come out of every paycheck — and your employer quietly pays a matching amount you never see. Go freelance and that arrangement disappears: you are now both the worker and the employer, so you cover both halves yourself. That combined contribution is self-employment tax, and it runs to 15.3% — 12.4% for Social Security and 2.9% for Medicare. It is the surprise that catches most first-year freelancers off guard, because it lands before income tax, not instead of it.
Why the calculator takes 92.35% first
Look at the first line of the result and you'll see your profit shrink to 92.35% of itself before any rate is applied. That isn't a glitch. An employee never pays Social Security and Medicare on the employer's share of the tax, so the rules let the self-employed knock off an equivalent slice — you multiply net profit by 0.9235 — before the 15.3% is charged. It's a fairness adjustment, and it's why the real bite on your profit comes out around 14.1% rather than a flat 15.3%.
Where the 15.3% actually goes
The two halves behave differently, which is the part worth understanding:
- Social Security (12.4%) only applies up to a yearly cap. For 2025 that cap is $176,100; for 2026 it rises to $184,500 (the SSA resets it each year). Earn past the cap and the 12.4% simply stops.
- Medicare (2.9%) has no cap. It applies to every dollar of your net earnings, all the way up.
- An extra 0.9% Medicare kicks in for high earners — above $200,000 (single or head of household), $250,000 (married filing jointly) or $125,000 (married filing separately). The calculator only shows this line when it actually applies to you.
If you also draw a W-2 salary, those wages use up the Social Security cap first. Enter them in the optional field and the tool will stop charging the 12.4% portion once your combined earnings clear the cap — a real saving that moonlighters routinely miss.
The half you get back
Self-employment tax feels heavier than it ends up being, because you can deduct one-half of it when you work out your adjusted gross income. It doesn't shrink the self-employment tax itself — you still owe the full amount — but it lowers the income your income tax is calculated on. The result shows this deductible half on its own line so you can hand it straight to whoever (or whatever) prepares your return.
This is not your whole tax bill
Read this twice, because it's where people get burned: self-employment tax sits on top of federal income tax, and on top of any state income tax. This tool deliberately estimates only the self-employment piece — the part that's the same arithmetic for everyone — and stays out of income-tax brackets, the standard deduction, the qualified business income deduction, credits and state rules, all of which depend on your full financial picture. For a sane way to budget the whole obligation, pair this number with our guide on how much to set aside for tax, and make sure the rate you charge actually survives it using the freelance hourly rate calculator.
A worked example
Say you cleared $60,000 of net profit freelancing in 2025, filing single, with no day job. First the profit drops to 92.35% — $55,410 of net earnings. The full 15.3% applies because you're nowhere near the $176,100 cap, giving $8,478 of self-employment tax (about $6,871 of Social Security and $1,607 of Medicare). Half of that, $4,239, is deductible against your income tax. Spread across four quarterly payments, the self-employment slice is roughly $2,119 each. That's an effective 14.1% of your profit — gone before income tax has even said hello.
Paying it: the quarterly part
Freelancers don't get to wait until April. Because nothing is withheld for you, the IRS expects estimated tax — income tax and self-employment tax together — in four payments across the year using Form 1040-ES. The "per quarter" line above is only the self-employment share of that; you'll add your estimated income tax to it. Miss the payments and you can owe an underpayment penalty even if you settle up in full at filing. We walk through the schedule, the due dates and the safe-harbor rule in quarterly estimated taxes for freelancers.
Assumptions and limitations
- U.S. federal self-employment tax only. No federal or state income tax, no city tax, no credits, no deductions other than the half-of-SE-tax adjustment described above.
- One combined net profit. Enter your total net self-employment earnings. The tool doesn't separate multiple businesses or farm vs. non-farm methods.
- The W-2 field is a simplification. It treats your entered wages as both Social Security and Medicare wages. If your pay stubs differ, or your spouse also has high earnings, your Form 8959 figure can shift slightly.
- Net profit must already be net. Subtract your deductible business expenses first — SE tax is charged on profit, not gross revenue.
- Figures are estimates. Rounding and your full return can move the final number. Use it to plan and budget, then file from your actual numbers.
Frequently asked questions
How much is self-employment tax?
The self-employment tax rate is 15.3% — that is 12.4% for Social Security plus 2.9% for Medicare. But it is charged on 92.35% of your net profit, not the whole amount, so the effective bite on your profit works out closer to 14.1%. On $60,000 of net profit that is about $8,478.
Who has to pay self-employment tax?
Generally anyone with $400 or more in net earnings from self-employment in a year: freelancers, independent contractors, gig workers, sole proprietors and most single-member LLC owners. If your net earnings are under $400, no self-employment tax is due (though you may still owe income tax).
Is self-employment tax on top of income tax?
Yes. Self-employment tax is separate from federal income tax. It is your Social Security and Medicare contribution — the part an employer would normally split with you. This tool estimates only the self-employment tax. Your income tax (federal and state) is a separate calculation on top.
Can I deduct any of it?
You can deduct one-half of your self-employment tax when figuring your adjusted gross income. It does not reduce the self-employment tax itself, but it lowers the income your federal income tax is based on. The calculator shows this deductible half on its own line.
Does a day job change the result?
It can. Social Security only applies up to a yearly wage cap, and W-2 wages from a job use up that cap first. If you enter the Social Security wages from your job, the calculator stops charging the 12.4% once your combined earnings pass the cap. The 2.9% Medicare part has no cap and keeps applying.
Why is it 92.35% of my profit and not 100%?
Employees never pay Social Security and Medicare on the employer’s half of those taxes, and the 92.35% factor (you multiply net profit by 0.9235) keeps the self-employed on roughly equal footing by removing the employer-share equivalent before the rate is applied.
Related guides
The Hidden Costs of Freelancing You Must Price In
The costs new freelancers forget — and that quietly turn a "good" rate into barely breaking even. A specific, itemised reality check.
Quarterly Estimated Taxes for Freelancers
How U.S. estimated taxes work for the self-employed — the four payment dates, the safe-harbor rule that protects you from penalties, and a habit that makes it painless.
Self-Employment Tax, Explained (Without the Jargon)
What U.S. self-employment tax is, why it's 15.3%, where the money goes, and why half of it comes back — written for freelancers seeing it for the first time.