Self-Employment Tax Calculator

How Self-Employment Tax Works for Freelancers

If you're a freelancer, independent contractor, or sole proprietor, you're responsible for paying self-employment tax on your net earnings. This is separate from income tax and covers Social Security and Medicare — the taxes that would normally be split between you and an employer.

Self-Employment Tax Rate (2025)

The self-employment tax rate is 15.3% of your net self-employment income. This breaks down into:

• 12.4% for Social Security (on the first $176,100 of net income for 2025)
• 2.9% for Medicare (on all net income, no cap)
• Additional 0.9% Medicare surtax on income over $200,000 (single) or $250,000 (married filing jointly)

How to Calculate Your Net Self-Employment Income

Start with your gross 1099/freelance income, subtract your deductible business expenses, then multiply by 92.35% (this adjustment accounts for the employer-equivalent portion of SE tax). The result is your net self-employment earnings that SE tax applies to.

The SE Tax Deduction

You can deduct the employer-equivalent portion (50%) of your self-employment tax when calculating your adjusted gross income. This reduces your income tax, though it doesn't reduce your SE tax itself.

QBI Deduction (Section 199A)

If you're a freelancer or sole proprietor, you may qualify for the Qualified Business Income deduction — up to 20% of your qualified business income. This can significantly reduce your income tax bill. The deduction phases out at higher income levels ($191,950 for single filers, $383,900 for married filing jointly in 2025).

Quarterly Estimated Tax Payments

If you expect to owe $1,000 or more in taxes, the IRS requires you to make quarterly estimated tax payments. The due dates for 2025 are:

• Q1: April 15, 2025
• Q2: June 16, 2025
• Q3: September 15, 2025
• Q4: January 15, 2026

Underpayment penalties apply if you don't pay enough through quarterly estimates or withholding.