How self-employment tax works (2026)
If you're a freelancer or 1099 contractor, you pay two things on your profit: self-employment (SE) tax and federal income tax. SE tax covers Social Security and Medicare — the parts an employer would normally split with you — so it feels higher than a W-2 employee's deductions.
SE tax (15.3%)
- SE tax is 15.3% (12.4% Social Security + 2.9% Medicare), charged on 92.35% of your net profit.
- The 12.4% Social Security part applies only up to the $184,500 wage base; the 2.9% Medicare part has no cap.
- Half of your SE tax is deductible from your income before income tax — this calculator applies it.
Federal income tax
After deducting half your SE tax and the $16,100 standard deduction, the 2026 single brackets (10%–37%) apply to what's left.
Example: $80,000 net profit
SE tax is about $11,304, and federal income tax about $7,527 — a total of ~$18,830, leaving a take-home of roughly $61,170 (about 23.5% total).
What this calculator does not include
- QBI deduction (20% qualified business income) — it has eligibility limits a simple calculator can't compute reliably, so it's excluded (your real tax may be lower if you qualify).
- State and local income tax, the extra 0.9% Medicare above $200,000, credits, and other deductions.
- Quarterly estimated-tax timing — this shows the annual total.
Why is self-employment tax so high?
As an employee, your employer pays half of Social Security and Medicare. When self-employed, you pay both halves — that's the 15.3% SE tax. You do get to deduct half of it from income tax.
What is the 92.35%?
SE tax is charged on 92.35% of your net profit (not 100%), which approximates the employer-half adjustment.
More United States calculators
This calculator provides estimates for a single filer in 2026 based on IRS rules and is for general information only — it is not financial or tax advice. It applies the standard deduction and excludes the QBI deduction, state/local tax, the additional 0.9% Medicare, credits and other deductions. For your exact position see IRS Topic 554. Sources: IRS (Topic 554, Rev. Proc. 2025-32), SSA.