If you freelance or run a sole proprietorship, you pay self-employment tax on your profit: 12.4% for Social Security and 2.9% for Medicare, the employee and employer halves that a job would split with you. This calculator follows Schedule SE and Form 8959 for tax year 2026. It shows each part of the tax, how a W-2 job uses up part of the $184,500 Social Security wage base, the 0.9% Additional Medicare Tax for high earners, the half you can deduct, and how much of each quarterly estimated payment goes to self-employment tax. Everything runs in your browser and nothing is sent anywhere.

2026 net profit from self-employment (Schedule C line 31, or your share from Schedule K-1)
Your W-2 wages from a job this year (Social Security wages, box 3; leave 0 if none)
Filing status
Your spouse's W-2 wages (Medicare wages, box 5; married filing jointly only)

How the math works

net SE earnings      = net profit x 92.35%        (no SE tax if this is under $400)
Social Security part = 12.4% x the smaller of net SE earnings and ($184,500 - your W-2 wages)
Medicare part        = 2.9% x net SE earnings     (no cap)
SE tax               = Social Security part + Medicare part
Additional Medicare  = 0.9% x net SE earnings over (threshold - W-2 Medicare wages)
                       threshold: $200,000 single, head of household, surviving spouse
                                  $250,000 married filing jointly (both spouses' wages count)
                                  $125,000 married filing separately
deductible half      = SE tax / 2                 (the 0.9% is not part of it)
quarterly share      = SE tax / 4

Example with the default inputs: $80,000 of profit gives $73,880 of net SE earnings. Social Security is 12.4% of that, $9,161.12, and Medicare is 2.9%, $2,142.52, so self-employment tax is $11,303.64 (about 14.1% of profit). Half of it, $5,651.82, comes off your income for income tax, and $2,825.91 of each quarterly payment covers it.

The rules this follows

  • Why 92.35%. You pay the employer half of Social Security and Medicare yourself, so the law lets you first take 7.65% (the employer share) off your profit. Schedule SE line 4a multiplies your profit by 92.35%, and if the result is under $400 you don’t owe self-employment tax. That means a profit of $433 or less owes none.
  • The 2026 Social Security wage base is $184,500. Only the first $184,500 of combined wages and self-employment earnings pays the 12.4% Social Security part. Wages from a job count first, so a W-2 job leaves less room: with $120,000 of Social Security wages, only $64,500 of self-employment earnings pays the 12.4%. Medicare has no cap. A spouse’s wages never reduce your wage base.
  • Additional Medicare Tax. An extra 0.9% applies to wages and self-employment income over $200,000 ($250,000 married filing jointly, $125,000 married filing separately). On Form 8959, your wages use up the threshold first, so self-employment income pays the 0.9% on whatever is over what’s left. On a joint return both spouses’ wages and self-employment income count. A self-employment loss doesn’t lower your wages for this test.
  • The deduction. You deduct half of your self-employment tax on Schedule 1. It lowers your income tax, not your self-employment tax, and the 0.9% Additional Medicare Tax isn’t included in it.
  • Paying it. Self-employment tax is paid through your quarterly estimated payments along with income tax. The quarterly share shown is a simple quarter of the year’s self-employment tax.
  • What this leaves out. The farm and nonfarm optional methods, church employee income, Conservation Reserve Program payments, unreported tips (Form 4137) and Form 8919 wages, and the case where both spouses are self-employed (each figures their own Schedule SE). If you’re an S corporation owner, your salary pays payroll tax instead.

Sources: SSA contribution and benefit base table (2026: $184,500), IRS Topic 554, Self-employment tax, IRS self-employment tax page, Schedule SE (Form 1040), IRS Topic 560, Additional Medicare Tax and Form 8959. Figures and rules checked on October 27, 2026. This is general information, not tax advice.

FAQ

Is self-employment tax the same as income tax?

No. Self-employment tax is only Social Security and Medicare. You pay federal income tax on the same profit on top of it, after the half-of-SE-tax deduction and your standard deduction.

I have a W-2 job and a side business. Do I still pay self-employment tax?

Yes, on your side profit. Your job’s wages only matter for the 12.4% Social Security part: once wages plus self-employment earnings pass $184,500 in 2026, the rest pays just the 2.9% Medicare part.

Does a retirement contribution lower self-employment tax?

No. For a sole proprietor, SEP IRA and Solo 401(k) contributions lower income tax, not self-employment tax. Business expenses on Schedule C do lower it, because they lower your profit.

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