You’ll need to pay self-employment tax if you make more than $400 in self-employment income. This calculator helps you estimate your payment amount and plan your quarterly payments effectively.

To use it, figure out your net self-employment income. Net self-employment income is your total self-employment earnings minus business expenses and deductions. Simply put, it’s: 

Net self-employment income = 

Self-employed revenue - business expenses

What is self-employment income? 

Self-employment income or revenue is money you make from working for yourself rather than an employer. This includes freelance work, independent contracting, side hustle earnings, and income from the gig economy. 

Any income where taxes aren't automatically withheld and you receive 1099 forms instead of W-2 forms typically counts as self-employment income. 

Self-employment tax rates

Key thresholds and rates:

• Self-employment tax rate is 15.3%, composed of:
• Social Security: 12.4% (up to $176,100 in 2025)
• Medicare: 2.9% (on all earnings)
• Additional medicare tax of 0.9% applies to income above:
• $200,000 for single/head of household/qualifying widow(er)
• $250,000 for married filing jointly,
• $125,000 for married filing separately

Note: You may deduct half of your self-employment tax when calculating your income tax.

When are quarterly estimated taxes due?

You must make quarterly tax payments if you expect to owe $1,000 or more in taxes for the year. Estimated self-employment taxes are due quarterly on the following days: 

• April 15: First-quarter income earned from January to March
• June 15: Second-quarter income earned from April through May 
• September 15: Third-quarter income earned from June through August 
• January 15: Fourth-quarter income earned from September through December

You can make payments for free online via the IRS Direct Pay. To avoid penalties, pay on time and at least 90% of the tax you owe. 

Underpayment Penalties

Missing or underpaying estimated taxes may result in:

• Interest charges
• A penalty of 0.5% of the unpaid amount per month (up to a maximum of 25%)

Helpful IRS Tools & Resources

Use IRS Form 1040-ES or the Tax Withholding Estimator to estimate payments accurately. The Estimator is not yet updated to reflect the One Big Beautiful Bill Act provisions. 

Payment options

• IRS Direct Pay: no registration needed,
• EFTPS: schedule payments up to 365 days ahead (requires enrollment) 

1099 vs. W-2 income

W-2 employees have taxes withheld and receive benefits, while 1099 contractors manage their taxes and deductions. 1099 workers must pay quarterly taxes and can deduct business expenses. 

Employees have their taxes automatically deducted, and the employer pays half the Social Security and Medicare taxes. Meanwhile, self-employed individuals must pay the full Social Security and Medicare tax (15.3%). However, 1099 contractors have more deduction opportunities. 

What counts as self-employment income

Money you earn from freelance, contract, gig work, or other self-employed ventures—especially when taxes aren’t withheld, and you're issued 1099 forms.

Deductions you can claim

Deduct business essentials like home office, travel, supplies, software, half your self-employment tax, health insurance, and retirement contributions. Track expenses with tools like QuickBooks.

Tax deductions for self-employed individuals

Lower your self-employed tax bill with deductions for business expenses, home office, vehicle use, health insurance, and retirement contributions. 

For example, some other common self-employed deductions include office supplies, software subscriptions, marketing expenses, and half of your self-employment tax. 

Track your expenses throughout the year by using accounting software built for self-employed individuals like QuickBooks Solopreneur.