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Self-Employment Tax Calculator 2026
Estimate your federal self-employment (SE) tax for 2026, including Social Security and Medicare portions, the deductible half, and W-2 wage adjustment.
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Total SE Tax
Social Security Portion
Medicare Portion
Deductible Amount (50%)
Net SE Earnings
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How Self-Employment Tax Is Calculated
Self-employment tax is calculated in three steps. First, your gross self-employment income is multiplied by 92.35% to arrive at your net SE earnings — this adjustment deducts the employer-equivalent half of payroll taxes before computing the tax base. Second, the Social Security portion (12.4%) is applied to the lesser of your net SE earnings or the remaining SS wage base ($184,500 in 2026 minus any W-2 wages already subject to SS tax). Third, the Medicare portion (2.9%) is applied to the full net SE earnings with no income cap. The combined rate of 15.3% equals the total employee + employer payroll tax that a W-2 employee would collectively pay.
Deducting Half of Your SE Tax
The IRS allows you to deduct 50% of your total SE tax from your gross income as an above-the-line deduction. This deduction is reported on Schedule 1 (Form 1040), Line 15, and reduces your adjusted gross income (AGI) — which in turn lowers the amount of federal income tax you owe. For example, if your SE tax is $10,000, you can deduct $5,000 from your income before computing your income tax. This deduction is available to all self-employed individuals regardless of whether they itemize deductions. Note that it reduces your income tax, but not the SE tax itself.
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Frequently Asked Questions
What is self-employment tax?
Self-employment (SE) tax is a 15.3% federal tax that covers both the Social Security (12.4%) and Medicare (2.9%) portions of payroll tax. When you are an employee, your employer pays half of these taxes on your behalf. When you are self-employed, you are responsible for both the employer and employee halves — which is why the combined rate is 15.3%. SE tax applies to net self-employment income from freelancing, consulting, sole proprietorships, single-member LLCs, and certain partnerships.
Why do I multiply my income by 92.35%?
The IRS allows you to reduce your gross self-employment income by 7.65% before calculating SE tax — this is the SE_NET_EARNINGS_FACTOR of 92.35% (1 − 0.0765 = 0.9235). The logic mirrors how employees are treated: an employer's 7.65% payroll contribution is not taxed as income to the employee. By deducting the equivalent employer-side portion from your gross earnings first, the IRS levels the playing field. So your taxable net earnings = gross self-employment income × 0.9235.
Can I deduct my self-employment tax?
Yes. You can deduct 50% of your self-employment tax from your gross income as an above-the-line deduction on Schedule 1, Line 15 of Form 1040. This reduces your adjusted gross income (AGI) and ultimately your federal income tax — but it does not reduce the SE tax itself. For example, if your total SE tax is $7,000, you can deduct $3,500 from your taxable income. This is not an itemized deduction; it applies whether or not you itemize.
Does self-employment tax apply to all self-employment income?
The Social Security portion (12.4%) is capped at the annual SS wage base, which is $184,500 for 2026. Income above that threshold is not subject to the SS portion of SE tax. The Medicare portion (2.9%) has no income cap and applies to all net self-employment earnings. Additionally, if you also have W-2 wages from an employer, those wages count toward the $184,500 limit — which is why this calculator includes a field for additional wages already subject to SS tax.
How do estimated quarterly taxes relate to SE tax?
Self-employment tax is not withheld from paychecks like it is for employees, so self-employed individuals must pay it through quarterly estimated taxes using Form 1040-ES. Estimated tax payments are due four times per year: April 15 (Q1), June 16 (Q2), September 15 (Q3), and January 15 of the following year (Q4). When calculating your estimated payments, include both your expected SE tax and your expected federal income tax on self-employment income.
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