How self-employment tax works
When you work for yourself, you pay both the employee and employer halves of Social Security and Medicare — a combined 15.3%.
It is charged on 92.35% of your net profit: 12.4% for Social Security up to the $176,100 wage base, plus 2.9% for Medicare with no cap.
This is separate from, and on top of, federal income tax.
The deductible half
You can deduct half of your self-employment tax when figuring your income tax. This recognises the employer-half you effectively paid.
The calculator shows that deductible amount so you can carry it into your income tax estimate.
Plan for quarterly payments
Self-employment tax is not withheld for you, so most self-employed people pay it through quarterly estimated payments to avoid a penalty.
This is a federal estimate using 2025 tax-year figures and the inputs you provide. It does not include state tax, credits, or every deduction. Confirm with the IRS or a tax professional before filing.
Frequently asked questions
What is the self-employment tax rate?
15.3% — 12.4% for Social Security (up to the annual wage base) and 2.9% for Medicare — applied to 92.35% of your net profit.
Is self-employment tax on top of income tax?
Yes. It is separate from federal income tax. You owe both on your self-employment profit.
Can I deduct any of it?
Yes — half of your self-employment tax is deductible against your income tax, which this calculator shows.
Do I need to pay quarterly?
Usually. Because no employer withholds it, the IRS expects quarterly estimated payments. Use the quarterly tax calculator to size them.