When you work for yourself, no employer takes tax out of your pay. You owe self-employment tax for Social Security and Medicare, plus income tax, and you're expected to pay both through the year.
Here's how the 2026 rules work, how to estimate what to set aside, and a worked example.
How self-employment tax works
An employee pays 7.65% for Social Security and Medicare and the employer pays another 7.65%. Self-employed people pay both halves: 15.3%.
Net earnings = net profit × 92.35%Social Security = 12.4% × net earnings (combined with any W-2 wages, up to $184,500)Medicare = 2.9% × net earnings, plus 0.9% above $200,000 ($250,000 joint)You owe self-employment tax once net earnings from self-employment reach $400 for the year.
Income tax on top
Your profit is also subject to regular income tax, but three deductions come off first:
- Half of your self-employment tax (the employer-equivalent part).
- The standard deduction: $16,100 single, $32,200 married filing jointly or $24,150 head of household in 2026.
- The 20% QBI deduction on qualified business income, for most freelancers with taxable income below $201,750 ($403,500 joint) in 2026.
Above those limits the QBI deduction can be reduced or lost, especially for consultants and other service businesses, so the calculator leaves it out there.
Worked example
Example: Single freelancer, $80,000 net profit, no other job
Net earnings: $80,000 × 92.35% = $73,880.
Social Security $9,161 + Medicare $2,143 = self-employment tax $11,304.
Income tax: $80,000 − $5,652 (half of SE tax) − $16,100 = $58,248; 20% QBI deduction $11,650; taxable $46,599; income tax $5,344.
Total about $16,648, or 21% of profit: roughly $4,162 a quarter.
Paying quarterly
Self-employed people usually pay estimated tax four times a year, around April 15, June 15, September 15 and January 15. Paying too little through the year can mean an underpayment penalty.
- Put a set percentage of every client payment aside the day it arrives, using the calculator's set-aside rate.
- If you also have a salaried job, you can raise your W-4 withholding there instead of paying quarterly.
- State income tax is separate; check your state's estimated payment rules.
How to use this calculator
- Enter your net profit: what clients paid you minus business expenses.
- Pick your filing status.
- If you also have a salaried job, enter those W-2 wages.
- Leave the QBI deduction on unless your income is above the limit or your business doesn't qualify.
FAQs
What is the self-employment tax rate for 2026?
15.3% on 92.35% of net earnings: 12.4% for Social Security, on combined earnings up to $184,500, and 2.9% for Medicare with no cap.
Why do freelancers pay double Social Security?
An employer normally pays half of Social Security and Medicare. When you're self-employed you pay both halves, but you can deduct half of it from your income.
When are quarterly estimated taxes due?
Usually April 15, June 15, September 15 and January 15 of the next year. Dates move to the next business day when they fall on a weekend or holiday.
Do I have to pay if I earned only a little?
You owe self-employment tax once your net earnings from self-employment reach $400 for the year.
Sources
- IRS: Topic 554, Self-employment tax
- IRS: Self-employment tax (Social Security and Medicare taxes)
- IRS: tax inflation adjustments for tax year 2026 (Rev. Proc. 2025-32)
Results are estimates and aren't tax, legal or financial advice. For your own return, check with a CPA or enrolled agent. Spotted a mistake? Tell us.