Self-Employment Tax Calculator
Estimate your self-employment tax — the Social Security and Medicare portions — and the deductible half, using 2024 rates.
How it works
Net earnings = net income × 92.35% · SE tax = min(net earnings, $168,600) × 12.4% + net earnings × 2.9%
Self-employment tax covers the Social Security and Medicare contributions that an employer and employee normally split — as your own boss, you pay both halves, 15.3% in total. It applies to 92.35% of your net profit (the adjustment mirrors the employer-side deduction employees get). Social Security’s 12.4% applies only up to the annual wage base; Medicare’s 2.9% has no cap. Half of the total is deductible on your income-tax return, which softens the blow.
Worked example
On $60,000 of net profit: taxable earnings are $60,000 × 0.9235 = $55,410. Social Security is $55,410 × 12.4% = $6,870.84 and Medicare is $55,410 × 2.9% = $1,606.89, for $8,477.73 in SE tax. Half of that, about $4,238.87, is deductible against income tax.
Sources: Self-Employment Tax — IRS
Frequently asked questions
Is this on top of income tax?
Yes. Self-employment tax funds Social Security and Medicare and is separate from federal and state income tax, which you also owe on your profit. The deductible half only reduces income tax, not the SE tax itself.
Why is it based on 92.35% of profit?
Employees don’t pay income tax on the employer’s share of payroll tax, so the 7.65% employer-equivalent is removed first (100% − 7.65% = 92.35%) to keep the self-employed on comparable footing.
When do I owe self-employment tax?
Generally once your net self-employment earnings reach $400 in a year. Because nothing is withheld for you, most self-employed people pay it through quarterly estimated taxes to avoid a penalty.
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Uses 2024 federal rates (15.3% combined, $168,600 Social Security wage base) and is an educational estimate, not tax advice. Rules, limits and additional Medicare surtaxes vary — consult a tax professional.