Self Employment Tax Calculator
Compute self-employment tax properly — the headline 15.3% is not the rate you pay, but you still pay thousands more than an employee earning exactly the same.
Self Employment Tax Calculator
Results recalculate instantly on every keystroke. Nothing you type is transmitted.
What this result does not account for
- Results are a model, not a quotation — an institution's own figures govern.
- Every input is an assumption; change one and the answer changes with it.
- Rounding is applied only at the display layer, so totals may differ by a cent from a statement that rounds each line.
In short: On $95,000 of net profit, self-employment tax is $13,423.07 — 14.13% of profit, not the headline 15.3%, because only 92.35% of profit is subject to it. Even so, total federal tax of $24,687.53 exceeds a W-2 employee's $20,008.50 on identical income by $4,679.03, and an S-corp election would save $5,008.07.
Formula
The 92.35% factor exists because an employer would have deducted its half of FICA before profit. It is why the effective rate is 14.13%, not 15.3%.
Worked Example
- Apply the 92.35% factor. $95,000 × 0.9235 = $87,732.50 of SE base.
- Charge both halves. 12.4% Social Security = $10,878.83, 2.9% Medicare = $2,544.24.
- Total the SE tax. $13,423.07 — 14.13% of profit, not 15.3%.
- Deduct half. $6,711.54 comes off taxable income, leaving $73,688.46 and $11,264.46 of income tax.
- Compare with a W-2 employee. $24,687.53 against $20,008.50 — a $4,679.03 penalty.
Analyst's note. Two corrections in opposite directions. The headline 15.3% overstates the rate, because only 92.35% of profit is subject to the tax and half of what you pay is deductible — the true figure is 14.13% of profit. But the self-employed still pay $4,679.03 more than an employee on identical income, because they fund both halves of FICA rather than one. That differential is exactly why contract rates must exceed salary equivalents by more than most freelancers assume. The S-corp election saves $5,008.07 here by paying payroll tax on a defensible salary rather than on the entire profit, though it brings payroll filing obligations and a genuine audit risk if the salary is unreasonably low.
Strengths & Limits Of This Model
Where this engine is strong
- Runs entirely in your browser — no figure you type is transmitted or stored.
- Shows the full working, so every number can be traced and challenged.
- Free, unmetered and free of affiliate incentives.
Where it stops
- Generalised assumptions cannot capture every individual circumstance.
- Jurisdiction-specific rules and mid-year changes may not be reflected.
- A model output is not a substitute for a professional review of your position.
Practical Use Cases
Setting aside the right amount from each invoice
Total federal tax is 25.99% of profit here. Reserving a quarter of every payment into a separate account is the discipline that prevents an April crisis — pair it with the Quarterly Tax Calculator.
Pricing freelance work against a salary
You must earn more than a salaried equivalent to net the same, by the self-employment penalty plus the employer loading you no longer receive. The Salary To Hourly Calculator builds the full rate.
Evaluating an S-corp election
Enter a defensible salary to see the saving. It is real — $5,008.07 here — but requires running payroll, filing a corporate return, and being able to justify the salary as reasonable for the work performed.
Methodology & Editorial Standards
Self-employment tax is computed on 92.35% of net profit, reflecting the deduction an employer would have taken for its share of FICA. Social Security at 12.4% applies up to the $168,600 wage base, reduced by any W-2 wages already earned in the year, and Medicare at 2.9% applies without limit. Half of the resulting tax is deducted from income for income tax purposes. The 0.9% Additional Medicare Tax above $200,000 is not applied. The W-2 comparison charges employee FICA only, so it understates the total economic burden on an employee once the employer match is counted — that match is quantified separately in the Payroll Tax Calculator. The S-corp comparison shows payroll tax on the stated salary against SE tax on full profit and ignores the additional compliance cost, state-level franchise taxes and the reasonable-compensation standard the IRS enforces. Not tax advice. The engine implements the standard published formula for this calculation. Inputs are validated for domain and sign before evaluation, and any undefined case returns an em-dash rather than a spurious value.
Computation runs in IEEE-754 double precision at full internal precision; rounding to two decimal places occurs strictly at the display layer, so no cumulative drift enters the result. All monetary outputs use accounting presentation — grouped thousands, two decimals, negatives in parentheses — so figures can be transcribed directly into a model or working paper. Division-by-zero and out-of-domain inputs return an em-dash rather than a misleading number.
This engine was reconciled against an independent reference implementation and hand-verified for the worked example above before release. Our full five-stage review process is published on the About Us page.
Disclaimer. This calculator is provided for informational and modelling purposes only and does not constitute financial, tax, legal, medical, or engineering advice. Verify all figures with a qualified professional before acting on them.
Self Employment Tax Calculator — 20 Expert FAQs
20 analyst-written answers to the questions practitioners actually ask — optimised for voice and answer-engine retrieval.
Is self-employment tax really 15.3%?
Not as an effective rate. Only 92.35% of profit is subject to it, so $95,000 of profit carries $13,423.07 — 14.13% of profit. Half of that is then deductible against income tax.
Why is the base 92.35% of profit?
Because an employer would have deducted its half of FICA before arriving at profit. The 7.65% reduction puts the self-employed on comparable footing, and it is why the effective rate is below the headline.
Do I pay more tax than an employee?
Yes — $4,679.03 more on $95,000 here, because you fund both halves of FICA. That is the amount you must earn above a salary equivalent simply to break even.
Can I deduct self-employment tax?
Half of it, $6,711.54 here, as an above-the-line deduction against income tax. It does not reduce the SE tax itself, only the income tax computed afterwards.
What is the S-corp strategy?
Electing S-corporation status lets you pay yourself a reasonable salary subject to payroll tax and take the rest as distributions that escape it — saving $5,008.07 here. The salary must be defensible for the work performed.
What is a reasonable salary for an S-corp?
What you would pay someone else to do your job, supported by industry data. Setting it artificially low is one of the IRS's most reliably audited positions, and the penalties include back payroll tax with interest.
Do W-2 wages reduce my SE tax?
They consume part of the Social Security wage base, so SE tax on the Social Security portion falls once combined earnings approach $168,600. Medicare continues uncapped regardless.
When do I owe self-employment tax?
Once net earnings from self-employment reach $400 for the year. Below that no SE tax is due, though income tax may still apply.
Does a solo 401(k) reduce SE tax?
No. Retirement contributions reduce income tax but not self-employment tax, which is computed on net profit before the contribution. The same asymmetry applies to employees and FICA.
What expenses reduce net profit?
Ordinary and necessary business expenses — equipment, software, professional fees, business travel, and the home office deduction if you qualify. Each dollar deducted saves both SE tax and income tax, making deductions worth far more to the self-employed.
How much should I set aside?
Around 26% of profit for federal tax at this income, plus state tax where applicable. Many freelancers reserve 30% into a separate account and treat it as untouchable.
Do I still get Social Security credit?
Yes. Paying self-employment tax earns the same quarters of coverage and benefit credits as an employee's FICA. You are funding both halves of your own future entitlement.
What about state tax?
This engine covers federal only. Most states tax self-employment income as ordinary income, and a few levy additional business or franchise taxes on top. Add them separately.
Should I form an LLC?
An LLC by itself changes nothing for tax — a single-member LLC is disregarded and still pays SE tax. The tax saving comes from the S-corp election, which an LLC can make, not from the LLC structure.
How does this affect my hourly rate?
Substantially. Replacing a salary requires covering the SE differential, the employer benefits you no longer receive, unpaid non-billable time and business overhead — which typically more than doubles the naive hourly equivalent.
Is this self employment tax calculator free to use?
Yes. It is free, requires no account, and has no usage limits. ApexConverter is funded by contextual advertising, never by selling user data.
Is my data sent to a server?
No. The engine runs as Vanilla JavaScript inside your browser under our Zero-Server Client-Side Execution model. Your figures are computed locally and are never transmitted, logged, or stored.
How accurate is this calculator?
It applies the standard closed-form formula in IEEE-754 double precision, rounding only at the display layer. The engine is reconciled against an independent reference implementation before release.
Does it work on mobile?
Yes. The interface is mobile-first with numeric keypad hints and is tested down to a 320-pixel viewport with no horizontal scrolling.
Can I use it offline?
Largely, yes. Because computation is client-side, the page continues to calculate without a network connection once it has loaded.