Self-Employment Tax Calculator
Use this calculator to estimate your self-employment tax liability. Self-employed individuals must pay both the employer and employee portions of Social Security and Medicare taxes.
Self-Employment Tax Calculator
Calculate your self-employment tax liability, including Social Security and Medicare taxes.
Self-Employment Tax Calculator
Income Information
How Self-Employment Tax Works:
Self-employment tax has two parts: 12.4% for Social Security (up to $160 200 in 2023) and 2.9% for Medicare (on all earnings). High earners pay an additional 0.9% Medicare tax. You can deduct half of your self-employment tax when calculating your income tax.
Self-Employment Tax Results
How to Use This Calculator
This calculator helps you make informed financial decisions by providing accurate estimates based on the information you provide. Follow these steps:
Enter Your Details
Fill in all required fields with your financial information.
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Use sliders and toggles to customize scenarios and assumptions.
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Understanding Self-Employment Tax
Self-employment tax is how self-employed individuals contribute to Social Security and Medicare. When you work for an employer, you and your employer each pay half of these taxes. When you're self-employed, you're responsible for both portions.
Components of Self-Employment Tax
- Social Security tax: 12.4% of your net earnings up to the wage base limit ($160,200 in 2023)
- Medicare tax: 2.9% of all your net earnings with no upper limit
- Additional Medicare tax: 0.9% on earnings above certain thresholds ($200,000 for single filers)
Calculating Self-Employment Tax
Self-employment tax is calculated on 92.35% of your net business income. This adjustment accounts for the employer-equivalent portion of your self-employment tax. You can also deduct half of your self-employment tax when calculating your income tax.
Tax Planning for Self-Employed
- Make quarterly estimated tax payments to avoid underpayment penalties
- Consider a business structure like an S-Corporation which may reduce self-employment taxes
- Maximize business deductions to reduce net earnings subject to self-employment tax
- Set up a retirement plan like a SEP IRA or Solo 401(k) to reduce taxable income