Self-Employment Tax Calculator (2026)

What is Self-Employment Tax Calculator?

Self-employment tax (SE tax) is the mechanism by which freelancers, independent contractors, and sole proprietors pay into Social Security and Medicare. Employees have these taxes split with their employer — each pays 7.65%: 6.2% Social Security + 1.45% Medicare. Self-employed individuals have no employer, so they pay both halves: 12.4% + 2.9% = 15.3% total. The precise calculation, as specified in IRS Schedule SE, is: Net earnings = net profit × 92.35%. The 92.35% factor comes from the fact that employees only pay FICA on the non-employer half of the tax — the IRS mirrors this for the self-employed. SE tax is then 15.3% of net earnings (the 12.4% Social Security portion is capped at the annual wage base; Medicare has no cap). For 2026, the Social Security wage base is $184,500 (source: IRS Revenue Procedure 2025-XX or SSA.gov annual announcement). For earnings above this limit, only the 2.9% Medicare rate applies. Additionally, single filers with wages and self-employment income above $200,000, married filing jointly above $250,000, and married filing separately above $125,000 owe an additional 0.9% Additional Medicare Tax on income above those thresholds (IRC § 3101(b)(2), added by the Affordable Care Act). This 0.9% portion is not deductible. A key tax benefit: one-half of the regular SE tax (the amount computed before the Additional Medicare Tax) is deductible as an above-the-line deduction on Form 1040 Schedule 1, line 15, reducing your Adjusted Gross Income and therefore your income tax.

How to Use

1. Enter your net business profit — revenue from freelancing or self-employment minus all ordinary and necessary business expenses (IRS Publication 535 covers deductible business expenses).
2. Select your filing status — this determines the threshold at which the 0.9% Additional Medicare Tax applies: $200,000 for single filers, $250,000 for married filing jointly.
3. If you also earned W-2 wages during the year, enter the Social Security wages from Box 3 of your W-2. The Social Security wage base limit ($184,500 for 2026) applies to the combined total of W-2 wages and SE earnings, so W-2 wages reduce how much SE income is subject to the 12.4% rate.
4. Click Calculate to see your Social Security tax, Medicare tax, Additional Medicare Tax (if applicable), total SE tax, deductible half, and recommended quarterly estimated payment.

Tips & Best Practices

• As a general planning rule, set aside 25%–30% of net self-employment income: roughly 15.3% for SE tax and 10%–15% for federal income tax. Higher earners in the 22%–24% bracket should save 30%–35%.
• If you expect to owe $1,000 or more in federal tax for the year (after withholding), the IRS requires quarterly estimated payments under IRC § 6654. Missing or underpaying these results in an underpayment penalty calculated at the federal short-term rate plus 3%.
• The 92.35% net earnings adjustment is not optional — it is the IRS-mandated method for Schedule SE. Some calculators skip it and overstate SE tax.
• If you have a Simplified Employee Pension (SEP-IRA) or Solo 401(k), contributions reduce your income tax (but not your SE tax). The contribution limit for a SEP-IRA is 25% of net self-employment income, up to $69,000 for 2024.
• For state income taxes, most states with income tax follow federal SE tax treatment, but a handful have unique rules — check your state's Department of Revenue or consult a CPA.

Frequently Asked Questions

Real-world Examples

Net freelance profit:           $95,000
W-2 Social Security wages:      $50,000
2026 SS wage base:              $184,500
Filing status:                  Single

Step 1 — Net earnings:
$95,000 × 0.9235 = $87,733

Step 2 — SS tax (with W-2 offset):
Remaining SS room: $184,500 − $50,000 = $134,500
$87,733 < $134,500 → full $87,733 subject to 12.4%
SS tax: $87,733 × 0.124 = $10,879

Step 3 — Medicare tax (no cap):
$87,733 × 0.029 = $2,544

Step 4 — Additional Medicare Tax:
Combined income: $95,000 + $50,000 = $145,000
$145,000 < $200,000 single threshold → $0

Total SE tax:        $13,423
Deductible half:     $6,712  (reported on Schedule 1, line 15)
Quarterly estimate:  $3,356/quarter

Tax savings from deductible half:
At 22% marginal rate: $6,712 × 22% = $1,477 in income tax savings

Set-aside recommendation:
SE tax ($13,423) + estimated income tax ≈ $22,000–$26,000 total
Set aside approx. 24%–27% of gross freelance revenue

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