Self-Employment Tax Calculator (2026 & 2027)

How It Works

When you work for an employer, Social Security and Medicare tax is split: 7.65% comes out of your paycheck and your employer pays the other 7.65%. When you work for yourself, there is no employer to split the bill with, so you pay both halves. That combined bill is self-employment tax (SE tax), figured on Schedule SE and filed with your Form 1040. The rate is 15.3% — 12.4% for Social Security and 2.9% for Medicare — applied to your net profit from self-employment, not your gross revenue.

One detail catches almost everyone out the first time: the 15.3% is not charged on your full net profit. The IRS first multiplies your net profit by 92.35%, and only that smaller figure — your net earnings from self-employment — is taxed. The 7.65% reduction mirrors the employer’s share of payroll tax that an employee never sees as income. On $60,000 of net profit, the taxable base is $55,410, which is why the effective rate works out at about 14.1% rather than the full 15.3%.

The two halves behave differently at higher incomes. The 12.4% Social Security portion stops once combined wages and self-employment earnings reach the annual wage base — $184,500 for 2026, $192,300 for 2027. The 2.9% Medicare portion has no cap: every dollar of net earnings pays it. Above $200,000 of earnings for a single filer ($250,000 joint), an additional 0.9% Medicare tax applies to the excess — figured on Form 8959, not Schedule SE, and not part of the deductible half. This calculator shows it on its own line.

Finally, the tax comes with a genuine break: you may deduct one half of your self-employment tax from your income when you work out your income tax. It goes on Schedule 1 of Form 1040 (line 15) as an adjustment to income, so it lowers your adjusted gross income whether or not you itemize. It is a deduction, not a credit — it shrinks the income your income tax is figured on rather than coming straight off your tax bill — and it covers the 12.4% and 2.9% portions only; the 0.9% additional Medicare tax is excluded.

Worked Example

Take a freelancer with $60,000 of net profit in 2026, no W-2 job, filing single. First the 92.35% factor: $60,000 × 0.9235 = $55,410 of net earnings. The Social Security portion is 12.4% of $55,410 = $6,870.84 (the whole amount is below the $184,500 wage base). The Medicare portion is 2.9% of $55,410 = $1,606.89. Total self-employment tax is $6,870.84 + $1,606.89 = $8,477.73 — about 14.13% of the profit. No additional Medicare tax applies, because $55,410 is below the $200,000 threshold. The deductible half is $8,477.73 ÷ 2 = $4,238.87. Paid quarterly, the bill is $8,477.73 ÷ 4 = $2,119.43 per estimated payment.

At higher incomes the shape changes. On $300,000 of net profit, net earnings are $277,050. The Social Security portion is capped: 12.4% of the $184,500 wage base = $22,878, and the $92,550 above the base escapes it. Medicare is 2.9% of the full $277,050 = $8,034.45. The additional Medicare tax applies to the $77,050 above the $200,000 single threshold: 0.9% × $77,050 = $693.45. Total: $22,878 + $8,034.45 + $693.45 = $31,605.90, or 10.54% of profit — lower than the $60,000 case, because the cap does more work as income rises.

If you also have a W-2 job, the wage base is shared. With $150,000 of W-2 wages and $60,000 of net profit, only $34,500 of wage-base room is left ($184,500 − $150,000), so the Social Security portion is 12.4% of $34,500 = $4,278. Medicare is still 2.9% of the $55,410 of net earnings = $1,606.89, and the additional Medicare tax applies to the $5,410 by which combined earnings pass $200,000: 0.9% × $5,410 = $48.69. Total: $5,933.58 — almost $2,500 less than the same profit with no W-2 job.

Self-employment tax at different profit levels, 2026, single filer, no W-2 wages:

Up to about $200,000 of profit the effective rate barely moves — it sits at 14.13% because both portions apply to (nearly) every dollar. It only falls once net earnings pass the wage base: at $300,000 the effective rate has dropped to 10.54%. The 0.9% additional Medicare tax only appears in the last row, because it needs combined earnings above $200,000.

Assumptions and What This Calculator Leaves Out

• Net profit means Schedule C profit — revenue minus deductible business expenses. If you have not subtracted expenses yet, the result will be too high.
• The $400 rule: if your net earnings (after the 92.35% factor) are under $400 for the year, no SE tax is due and Schedule SE is not required. A $400 profit gives only $369.40 of net earnings, so profit must reach $434 before any SE tax applies.
• W-2 wages are treated as fully subject to Social Security and Medicare tax. If some of your wages were exempt, the wage-base sharing will be off.
• Filing status only changes the additional Medicare threshold ($200,000 single, $250,000 married filing jointly). Married filing separately ($125,000 threshold) is not modelled.
• Church employee income and the optional farm/nonfarm methods are not modelled.
• State income tax is not included — states treat self-employment profit differently.
• Income tax is separate: SE tax is only the Social Security and Medicare half of the bill, and federal income tax is figured on top of it.
• If you expect to owe $1,000 or more in total tax, the IRS generally requires quarterly estimated payments (Form 1040-ES). For 2026 the due dates are April 15, June 15, September 15, 2026 and January 15, 2027.

How to Use This Calculator

Enter your net profit for the year, any W-2 wages, your filing status and the tax year. The results show your net earnings after the 92.35% factor, the Social Security and Medicare portions, any additional Medicare tax, the total tax, the deductible half and the effective rate. Use the Reset button to return to the $60,000 worked example.

Tips and Practical Advice

Set money aside from every payment, not once a year. SE tax plus income tax together take a large bite — a common rule of thumb is to hold back roughly a quarter to a third of each payment until you know your real rate. Missing the quarterly estimated payments can mean an underpayment penalty on top of the tax itself, so the $2,119.43 quarterly figure in the worked example is worth treating as a real deadline.

Track every deductible business expense: each one lowers your net profit and therefore your SE tax directly — $1,000 of legitimate expenses saves about $141 of SE tax plus whatever it saves on income tax. Retirement contributions work differently: money you put into a SEP IRA or Solo 401(k) lowers your income tax but not your SE tax, because those contributions are not deducted from net earnings for Schedule SE purposes. And if your profit is growing past the wage base, remember the effective rate falls as income rises — the $300,000 row of the table pays 10.54%, not 14.13%.

Sources: IRS — Self-Employment Tax (Social Security and Medicare Taxes); IRS Topic No. 554; Social Security Administration 2027 COLA Fact Sheet (wage base $192,300 for 2027; $184,500 for 2026). Figures checked 13 November 2026. Last reviewed: 13 November 2026.

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Frequently Asked Questions