What is the self-employment tax rate?

The self-employment tax rate is exactly 15.3%. This is composed of two parts: 12.4% for Social Security and 2.9% for Medicare.

Do I pay self-employment tax on my gross income or net income?

You only pay self-employment tax on your Net Business Income (your gross income minus your legitimate business expenses). Furthermore, the IRS only taxes 92.35% of that net income.

Is self-employment tax the same as income tax?

No. Self-employment tax exclusively funds Social Security and Medicare. You must pay this 15.3% tax in addition to your standard Federal and State Income Taxes.

How can I avoid paying self-employment tax?

You cannot legally avoid it entirely, but you can significantly reduce it. First, track every single business expense to lower your Net Income. Second, if your business is highly profitable (usually over $80,000 net), you can elect to be taxed as an S-Corporation, which allows you to legally bypass SE tax on a portion of your profits.

Self Employment Tax Calculator

Instantly calculate your 15.3% self-employment tax. Discover exactly how much you owe for Social Security and Medicare based on your net 1099 business income.

Net Earnings

Net Self-Employment Income

Your total 1099 profit *after* deducting business expenses (Schedule C).

Total Self-Employment Tax

$7,065

This is the 15.3% FICA tax you must pay to the IRS. This does NOT include your standard Federal or State Income Tax.

Social Security (12.4%)

$5,726

Funds retirement and disability benefits.

Medicare (2.9%)

$1,339

Funds healthcare for individuals 65 and older.

Calculation Details

Net Earnings Submitted$50,000

Taxable SE Base (92.35% of Net)$46,175

Employer Equivalent Deduction-$3,532

The IRS allows you to deduct exactly half of your SE tax from your Adjusted Gross Income (AGI) when calculating your standard income tax, mimicking the deduction employers get.

How to Use the Self Employment Tax Calculator

Using our self employment tax calculator is simple and requires no registration:

Calculate your Net Self-Employment Income. This is your total revenue minus all your business write-offs.
Enter your Net Income into the calculator.
The calculator will automatically apply the 92.35% IRS adjustment rule.
It will split your liability into Social Security (12.4%) and Medicare (2.9%), showing you exactly how much FICA tax you owe the government.

Why Use a Self Employment Tax Calculator?

The 15.3% self-employment tax catches millions of new freelancers off guard every year because it is completely separate from standard income tax. This Self Employment Tax Calculator instantly isolates your FICA liability so you know exactly how much of your profit belongs to Social Security and Medicare.

What is the Self-Employment Tax in 2026?

The Self-Employment (SE) tax is often the most painful discovery for new freelancers, gig workers, and small business owners. Unlike the standard Federal Income Tax (which pays for things like the military and highways), the SE tax specifically funds the US Social Security and Medicare systems.

By law, every working American must contribute to these systems. The total contribution rate is 15.3%. Using a self employment tax calculator is crucial because this tax applies to your business profits before any standard or itemized deductions are taken.

How the 15.3% is Split

The 15.3% SE tax is composed of two entirely separate programs. Our SE tax calculator breaks these down for you:

FICA Tax Breakdown

Social Security (12.4%): This funds retirement, disability, and survivor benefits. It is capped; meaning you only pay this 12.4% on your first $168,600 of net earnings (Note: this cap adjusts slightly each year for inflation). Any income above the cap is completely free of the Social Security tax.
Medicare (2.9%): This funds healthcare for individuals aged 65 and older. Unlike Social Security, there is no cap on Medicare tax. You will pay 2.9% on every single dollar you earn, forever. If you earn over $200,000 (single), an Additional Medicare Tax of 0.9% also kicks in.

Why W2 Employees Don't Notice It

If you were previously a W2 employee, you might be thinking, "I never paid a 15.3% tax before!" Yes, you did, but it was hidden from you.

In the W2 world, the 15.3% burden is split evenly. The employee pays 7.65% (withheld from their paycheck), and the employer pays the other 7.65% behind the scenes. When you become self-employed, you are legally both the employee and the employer. Therefore, you must pay both halves.

The Silver Lining: The SE Deduction

Because it is unfair that W2 employees get their "employer half" paid for them, the IRS offers a massive deduction to self-employed individuals to level the playing field.

You are allowed to deduct exactly half of your SE tax from your Adjusted Gross Income (AGI). For example, if your SE tax is $10,000, you can deduct $5,000 from your income before calculating your standard Federal Income Tax. This employer equivalent deduction saves self-employed individuals thousands of dollars a year and is automatically factored into advanced tax planning.