Self-Employment Tax Calculator

What is self-employment tax?

Self-employment (SE) tax is how freelancers, contractors and small business owners pay into Social Security and Medicare. Employees split these taxes with their employer — 7.65% each. When you work for yourself, you are both the employee and the employer, so you pay the full 15.3%: 12.4% for Social Security and 2.9% for Medicare. It’s calculated on Schedule SE and is owed on top of regular income tax.

How to use this calculator

1. Enter your net self-employment profit — your business income minus deductible expenses.
2. If you also had a W-2 job, enter those wages so the Social Security cap is applied correctly.
3. Choose your filing status, which sets the Additional Medicare Tax threshold.
4. Read your SE tax, the deductible half and the step-by-step breakdown.

How self-employment tax is calculated for 2026

1. Net earnings. Multiply your net profit by 92.35%. This mirrors the employer’s share being deductible for a regular business. If the result is under $400, no SE tax is due.

2. Social Security (12.4%). Applies only up to the 2026 wage base of $184,500, set by the Social Security Administration. W-2 wages count toward this limit first, so someone earning $150,000 in wages only pays Social Security on the next $34,500 of self-employment earnings.

3. Medicare (2.9%). Applies to all net earnings, with no cap.

4. Additional Medicare Tax (0.9%). Applies to earnings above $200,000 (single or head of household), $250,000 (married filing jointly) or $125,000 (married filing separately). These thresholds are fixed by law and reported on Form 8959.

Example: $80,000 of net profit gives $73,880 of net earnings. Social Security is $9,161.12 and Medicare is $2,142.52, for $11,303.64 of SE tax — an effective 14.1% of profit. You can deduct half, $5,651.82.

The deductible half

You can subtract half of your SE tax (excluding the Additional Medicare Tax) from your income on Schedule 1. This doesn’t reduce the SE tax itself, but it lowers your adjusted gross income and therefore your income tax. It also reduces the income used for the qualified business income deduction.

Ways to lower self-employment tax legally

• Track every deductible business expense — each dollar of expenses cuts SE tax by about 15 cents.
• Claim a home office, business mileage and health insurance premiums where eligible.
• Some owners choose to be taxed as an S corporation and pay themselves a reasonable salary; get professional advice first.

SE tax is only part of what you owe. To estimate income tax too and plan your quarterly payments, use the 1099 Quarterly Estimated Tax Calculator, and bill clients with our invoice generator.