Free Self-Employment Tax Calculator

When you work for someone else, Social Security and Medicare tax comes out of every paycheck, and your employer pays a matching amount you never see. When you work for yourself, as a sole proprietor, a partner, or the owner of an LLC taxed as either, there’s no employer. You pay both halves, and that combined tax is self-employment tax.

For most contractors who get 1099s, it’s the tax that surprises them. It’s on top of income tax, nobody withholds it, and it applies from a fairly low level of profit. A contractor who would owe little income tax can still owe thousands in self-employment tax.

This calculator works out the 2026 self-employment tax on your business profit the way the IRS worksheet in the 2026 Form 1040-ES does: the Social Security part, the Medicare part, the total, and the deduction for half of it. If your earnings are high enough to owe the Additional Medicare Tax, it shows that too.

For the 2026 tax year:

1. Net profit = business income − business expenses.
2. Net earnings from self-employment = net profit × 92.35%. If this is under $400, there’s no self-employment tax.
3. Social Security part = 12.4% × net earnings, but only on earnings up to $184,500, less any W-2 wages that already had Social Security tax taken out.
4. Medicare part = 2.9% × all net earnings. There’s no cap.
5. Self-employment tax = Social Security part + Medicare part.
6. Deduction = half of the self-employment tax, taken when you figure adjusted gross income.

The 92.35% step exists because an employer’s half of these taxes isn’t part of an employee’s taxable pay. Taking 7.65% off your profit first puts you on roughly the same footing as an employee.

A one-truck contractor

A contractor billed $95,000 in 2026 and spent $23,000 on materials, fuel, insurance, tools and software. Net profit is $72,000.

• Net earnings: $72,000 × 0.9235 = $66,492
• Social Security: $66,492 × 0.124 = $8,245.01
• Medicare: $66,492 × 0.029 = $1,928.27
• Self-employment tax: $10,173.28
• Deduction for half: $5,086.64

That’s 14.13% of the profit, before any income tax.

Earnings over the wage base

A remodeler nets $200,000. Net earnings are $184,700, which is over the $184,500 wage base, so the Social Security part stops at $184,500 × 0.124 = $22,878. The Medicare part is $184,700 × 0.029 = $5,356.30. Self-employment tax is $28,234.30, 14.12% of profit, and the share keeps falling as profit rises above the base. At this level there’s no Additional Medicare Tax for a single filer, because $184,700 is under the $200,000 threshold.

A W-2 job and a side business

An electrician earns $60,000 in W-2 wages and nets $150,000 from side work. Net earnings from the side work are $138,525. The wages already used $60,000 of the wage base, leaving $124,500, so the Social Security part is $124,500 × 0.124 = $15,438. Medicare is $138,525 × 0.029 = $4,017.23. Self-employment tax is $19,455.23.

Self-employment tax isn’t instead of income tax. Your net profit also goes into your income, along with any wages and other income, and is taxed at your income tax rates after deductions. The half of self-employment tax you deduct lowers that income a little, which is the one way the two taxes interact.

For a single filer with $72,000 of profit and no other income, the 2026 standard deduction of $16,100 and the deduction for half the self-employment tax leave about $50,800 of taxable income. Federal income tax on that is a little over $5,800. Added to the $10,173.28 of self-employment tax, the federal total is around $16,000, roughly 22% of the profit, before any state tax.

That 22% is an average across this one example, not a rate to use for yourself. A different filing status, a spouse’s income, other deductions or credits, and state income tax all move it. What the example does show is the shape of the bill: here, self-employment tax is the bigger of the two federal taxes by a wide margin, which is easy to miss in your first year working for yourself.

The quarterly estimated tax calculator puts both taxes together and works out what to pay each quarter.

Self-employment tax applies to people who work for themselves: sole proprietors, independent contractors paid on a 1099, partners in a partnership, and members of an LLC that’s taxed as a sole proprietorship or a partnership. If you’re paid as an employee of your own corporation, Social Security and Medicare come out of your wages through payroll instead, and the rules are different.

You don’t need a 1099 for the income to count. Cash, checks, card payments and transfers from homeowners are all business income, whether or not anyone sends you a form. Keep your own record of every payment.

On the return, business profit is figured on Schedule C, and self-employment tax on Schedule SE, which goes in with your Form 1040. During the year, the estimate goes into your quarterly payments, because no one withholds it for you.

Two numbers are worth checking every year. The Social Security wage base changes with average wages; for 2026 it’s $184,500, published by the Social Security Administration. And the Additional Medicare Tax applies once your wages and self-employment income together pass your filing status’s threshold, so a good year can bring it into play even if it never applied before.

Figuring it on gross income. The tax is on net profit after expenses, and then only on 92.35% of it. Every business expense you record lowers it.

Not recording expenses. Mileage, tools, phone, insurance, software and supplies all come off the profit. Missing receipts are paid for twice: once at the store and again in tax.

Forgetting it entirely. Income tax brackets don’t apply to it, and the standard deduction doesn’t reduce it. A low-income year can still carry a real self-employment tax bill.

Waiting until April. Nobody withholds it. Most self-employed people need to pay it through quarterly estimated payments, or face a penalty for paying late.

Double-counting the wage base. If you also have W-2 wages, they use up the wage base first. Only the room left applies to your business earnings.

Self-employment tax is a cost of being in business for yourself, and like every cost it has to come out of what you charge. If you price your hourly rate as if it were a wage, the 15.3% comes out of your pocket. Work out the wage you want to pay yourself, then price the work so the business earns that wage plus its overhead, markup and the taxes on top.

Set money aside from every payment, not at the end of the quarter. Moving a fixed share of each deposit into a separate account turns the quarterly payment into a transfer rather than a scramble. The labor rate calculator shows how overhead and markup turn a wage into a rate, and the hourly to salary calculator turns that rate into yearly pay.

BuildWell builds every estimate from labor at your area’s wage plus your overhead and markup, which you set once in Pricing settings. Your invoice list shows what’s paid and unpaid, with totals by day, week or month, so you can see what came in before each estimated payment is due.