When you work for yourself, no employer pays half of your Social Security and Medicare. You pay both halves yourself, and that is self-employment tax. It comes on top of income tax, and for many freelancers it is the bigger of the two. This guide covers the 2026 self employment tax rate, shows how to calculate it step by step, and walks through examples for freelancers, 1099 contractors, and side gigs. If you would rather skip the math, our self employment tax calculator does it for you.
What is self-employment tax?
Self-employment tax is Social Security and Medicare tax for people who work for themselves: sole proprietors, freelancers, independent contractors, gig workers, and partners in most partnerships. An employee pays 7.65% of their wages and their employer pays another 7.65%. When you are self-employed, you pay the full 15.3%.
You owe it once your net earnings from self-employment reach $400 for the year, whether or not a client sends you a Form 1099. You figure it on Schedule SE and pay it with your Form 1040.
2026 self employment tax rate
Social Security: 12.4%, on net earnings up to the $184,500 wage base for 2026.
Medicare: 2.9% of all net earnings, with no cap.
Additional Medicare Tax: an extra 0.9% on earnings above $200,000 if single, $250,000 if married filing jointly, or $125,000 if married filing separately.
So the self employment tax rate is 15.3% on most earnings, 2.9% once you pass the Social Security wage base, and 3.8% on the highest earnings. See our guide to how self-employment tax works for the full rules.
How to calculate self-employment tax, step by step
Find your net profit. Take your business income and subtract your business expenses. This is the bottom line of Schedule C.
Multiply by 92.35%. This gives your net earnings from self-employment. The 7.65% reduction mirrors the employer's share that an employee never pays tax on.
Apply 12.4% for Social Security to net earnings up to $184,500, minus any W-2 wages you already earned this year.
Apply 2.9% for Medicare to all net earnings.
Add the 0.9% Additional Medicare Tax if your earnings are above the threshold for your filing status.
Deduct half. Half of your self-employment tax is an above-the-line deduction that lowers your income tax.
Self-employment tax examples for 2026
$60,000 of freelance profit, single
Net earnings are $60,000 × 92.35% = $55,410.
Social Security: $55,410 × 12.4% = $6,870.84
Medicare: $55,410 × 2.9% = $1,606.89
Self-employment tax: $8,477.73
Self employment tax deduction: half, or $4,238.87
For income tax, subtract the $4,238.87 deduction and the $16,100 standard deduction, and taxable income is $39,661.13. The 20% qualified business income (QBI) deduction takes off another $7,932.23, leaving $31,728.90 of taxable income and about $3,559 of federal income tax. In total, this freelancer owes about $12,037 to the IRS, or roughly $3,009 a quarter.
An employee earning the same $60,000 would pay $4,590 of Social Security and Medicare, and their employer would cover the rest.
$100,000 of 1099 income
Net earnings are $92,350. Social Security is $11,451.40 and Medicare is $2,678.15, for $14,129.55 of self-employment tax. Half of it, $7,064.78, comes off your income before income tax. Try your own numbers with the 1099 tax calculator.
$200,000 of profit: the Social Security cap
Net earnings are $184,700, just over the $184,500 wage base. Social Security applies only to the first $184,500 ($22,878), and Medicare applies to all of it ($5,356.30), for $28,234.30. The Additional Medicare Tax does not apply yet, because net earnings are below $200,000.
A W-2 job plus a side gig
If you also have a W-2 job, your wages use up the Social Security wage base first. That can lower the tax on your side income.
$90,000 of W-2 wages plus $30,000 of freelance profit: $94,500 of the wage base is left, which covers all $27,705 of net earnings. Self-employment tax is $4,238.87.
$170,000 of W-2 wages plus the same $30,000: only $14,500 of the wage base is left, so Social Security is $1,798.00 and Medicare is $803.45. Self-employment tax drops to $2,601.45.
Our schedule SE calculator handles W-2 wages, so you can see exactly how much of the Social Security tax you owe as a self-employed worker.
How to pay self-employment tax
Nobody withholds tax from freelance income, so most self-employed people pay quarterly estimated tax. For the 2026 tax year, the due dates are April 15, June 15, and September 15, 2026, and January 15, 2027.
You avoid an underpayment penalty if you pay at least 90% of this year's tax, or 100% of last year's tax (110% if last year's adjusted gross income was over $150,000). If you also have a W-2 job, you can raise the withholding on your W-4 instead of sending quarterly payments.
How to lower self-employment tax
Track every business expense. Self-employment tax is based on net profit, so each deductible expense lowers both it and your income tax.
Deduct your home office, mileage, and equipment if they are used for your business.
Consider an S corporation once your profit is well into six figures. You pay yourself a reasonable salary, and profit taken as distributions is not subject to self-employment tax. It adds payroll and accounting costs, so talk to a tax professional first.
Remember what does not help: a SEP-IRA or solo 401(k) and self-employed health insurance lower your income tax, but not your self-employment tax.
Self-employment tax FAQ
How much is self employment tax in 2026?
15.3% of 92.35% of your net profit, which works out to about 14.13% of profit. Above the $184,500 Social Security wage base, only the 2.9% Medicare part continues, plus 0.9% on earnings over $200,000 for a single filer.
Do I pay self-employment tax if I did not get a 1099?
Yes. You owe it on all self-employment income of $400 or more, whether or not you received a 1099-NEC or 1099-K.
Is self-employment tax the same as income tax?
No. Self-employment tax pays for Social Security and Medicare. Income tax is separate and uses the regular tax brackets. Most self-employed people owe both.
Is there a freelance tax calculator for 2026?
Yes. Our free freelance tax calculator works out your 2026 self-employment tax for sole proprietors and independent contractors, including the Social Security cap, the Additional Medicare Tax, W-2 wages, and the half you can deduct.
This article is for general information and is not tax, legal, or financial advice. Tax rules change, so confirm your situation with a tax professional.