Self-Employment Tax Calculator
Estimate US self-employment tax (15.3% for Social Security and Medicare) and quarterly payments from net income.
Includes the 50% SE tax deduction from AGI.
Self-employment (SE) tax is the Social Security and Medicare tax that self-employed individuals pay. Employees split these taxes 50/50 with their employer, but self-employed people pay both halves — though they get a deduction for the employer portion.
SE Tax calculation (Schedule SE):
Step 1: Net SE Income = Business Revenue − Business Expenses
Step 2: SE Tax Base = Net SE Income × 0.9235 (multiplied by 92.35% to account for the employer deduction)
Step 3: SE Tax = SE Tax Base × 0.153
The 15.3% rate breaks down as:
- Social Security: 12.4% (on SE income up to $168,600 in 2024)
- Medicare: 2.9% (no cap; additional 0.9% on income over $200,000 single / $250,000 MFJ)
Deductions:
- SE Deduction: 50% of SE tax is deductible from gross income (reducing your AGI)
- QBI Deduction: Qualified Business Income deduction — up to 20% of QBI for eligible businesses (phases out above $182,050 single / $364,200 MFJ in 2024)
Worked example: Freelancer with $55,000 gross income, $8,000 business expenses: Net SE Income = $55,000 − $8,000 = $47,000 SE Tax Base = $47,000 × 0.9235 = $43,404.50 SE Tax = $43,404.50 × 0.153 = $6,640.89
SE Deduction (50% of SE tax) = $6,640.89 / 2 = $3,320.45 (deducted from AGI) QBI Deduction (20% of $47,000) = $9,400 (further reduces taxable income)
Total taxable income from self-employment = $47,000 − $3,320 − $9,400 = $34,280 (before other deductions)
Quarterly estimated taxes: Due April 15, June 17, September 16, and January 15. Use IRS Form 1040-ES. Underpayment penalty applies if you owe $1,000+ at year end.
S-Corporation strategy: At higher income levels (typically $60,000+ net profit), electing S-Corp status allows you to pay yourself a “reasonable salary” and take the remainder as distributions — which are NOT subject to SE tax, potentially saving thousands per year.