Self-Employment Tax Calculator — Free 2026 Calculator
Self-employment tax is 15.3% of your net earnings — 12.4% for Social Security and 2.9% for Medicare. Enter your net self-employment income below to see exactly how much you owe and how much you can deduct.
Your net profit from Schedule C (after business expenses)
What Is Self-Employment Tax?
Self-employment tax covers your Social Security and Medicare contributions when you work for yourself. If you are a W-2 employee, your employer pays half of FICA (7.65%) and you pay the other half. When you are self-employed, you pay both halves — 15.3% total.
The tax applies to 92.35% of your net self-employment income. This adjustment exists because W-2 employees only pay FICA on their wages after the employer's share is accounted for. The IRS gives self-employed individuals the same treatment.
Who Pays Self-Employment Tax?
You owe SE tax if your net self-employment income is $400 or more in a tax year. This includes income from freelancing, independent contracting, sole proprietorships, single-member LLCs, and general partnerships. Even if you also have W-2 income, your self-employment earnings are taxed separately.
How to Reduce Self-Employment Tax
- Elect S-Corp status — pay yourself a reasonable salary and take remaining profit as distributions not subject to SE tax.
- Maximize business deductions — every dollar of legitimate business expense reduces your Schedule C net profit, which reduces your SE tax base.
- Contribute to retirement accounts — SEP-IRA contributions (up to 25% of net SE income) and Solo 401(k) contributions reduce your taxable income.
- Use the deductible half — the employer-equivalent 50% of your SE tax is an above-the-line deduction that reduces your AGI.
Frequently Asked Questions
What is self-employment tax?
Self-employment tax is the Social Security and Medicare tax that self-employed individuals pay. It is the equivalent of the FICA taxes that employers and employees split — but when you are self-employed, you pay both halves. The total rate is 15.3% (12.4% Social Security + 2.9% Medicare) on 92.35% of your net self-employment income.
Who has to pay self-employment tax?
Anyone who earns $400 or more in net self-employment income must pay SE tax. This includes freelancers, independent contractors, sole proprietors, single-member LLC owners, and general partners. Even if you also have a W-2 job, your side-income over $400 triggers SE tax.
Why is SE tax calculated on 92.35% of income?
The 92.35% factor (1 - 7.65%) mirrors the employer portion of FICA. W-2 employees only pay FICA on their wages after the employer pays its half. The 92.35% adjustment gives self-employed individuals a comparable tax base.
Can I deduct self-employment tax?
You can deduct the employer-equivalent half (50%) of your self-employment tax as an above-the-line deduction on your Form 1040. This reduces your adjusted gross income (AGI), which can lower your income tax. You claim this deduction on Schedule 1, not on Schedule C.
How can I reduce my self-employment tax?
Common strategies include: electing S-Corp status (paying yourself a reasonable salary while taking remaining profit as distributions not subject to SE tax), contributing to a SEP-IRA or Solo 401(k) (reduces net income), and maximizing legitimate business deductions to lower your Schedule C net profit.
TaxTidy provides expense organization tools based on the most current US tax law available to it. TaxTidy is not a CPA, Enrolled Agent, or licensed tax professional. All categorizations, deductions, and tax calculations are estimates. Please verify all data for accuracy and consult a certified tax professional before filing.
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