An employer deducts its half of payroll tax as a business expense. The 92.35% (100% minus half of 15.3%) gives you the same break before the tax is figured.

Do I owe it if I made less than $400?

No. If net earnings (profit × 92.35%) are under $400, there's no self-employment tax. You might still owe income tax.

Does an S corporation avoid it?

An S corp owner-employee pays payroll tax on a reasonable salary instead, and the remaining profit isn't subject to SE tax. Whether that saves money after the extra payroll and filing costs depends on your numbers — talk to a CPA before switching.

What about the QBI deduction?

The qualified business income deduction lowers income tax, not self-employment tax. The income tax estimate here ignores it, so treat that number as a ceiling.

TaxesTax years 2025 & 2026

Self-Employment Tax Calculator

The Social Security and Medicare tax you pay as your own boss, figured line by line like Schedule SE — including a W-2 job's effect on the wage base, the Additional Medicare Tax, and how much to set aside.

Ben / Reviewed Sep 27, 2026 / v2.0.0

Your numbers

Tax year

Filing status

Your business

Net profit from self-employment

If you also had a W-2 job

Wages already paid Social Security tax, so they use up part of the wage base.

Social Security wages and tips

Medicare wages

Church employee income

For a set-aside estimate

Your income tax bracket

Results

Showing the numbers you calculated

Self-employment tax: $14,129.55; 14.13% of your net profit
Deduction for half of it: $7,064.78; Lowers your income tax (Schedule 1)
Social Security part (12.4%): $11,451.40; On $92,350.00
Medicare part (2.9%): $2,678.15; On $92,350.00
Set aside for taxes: $34,575.30; About 34.58% of profit — SE tax and rough income tax

Schedule SE, line by line

Schedule SE, line by line
Line	What it is	Amount
3	Net profit from self-employment	$100,000.00
4a	Line 3 × 92.35%	$92,350.00
4c	Net earnings from the business	$92,350.00
6	Net earnings from self-employment	$92,350.00
7	Social Security wage base (2026)	$184,500.00
8d	W-2 Social Security wages and tips	$0.00
9	Wage base left for self-employment	$184,500.00
10	Social Security: 12.4% of the smaller of line 6 or line 9	$11,451.40
11	Medicare: 2.9% of line 6	$2,678.15
12	Self-employment tax	$14,129.55
13	Deduction: half of line 12	$7,064.78

What this does

When you work for someone else, you and your employer split Social Security and Medicare tax — 7.65% each. When you work for yourself, you're both, so you pay both halves. That's self-employment tax, and it's the reason your first tax bill as a freelancer is a shock.

This works it out the way Schedule SE does, line by line, including what a W-2 job does to it, the extra 0.9% Medicare tax at high incomes, and a rough number to set aside.

How the math works

You don't pay it on all of your profit — first it's trimmed to 92.35%, which mimics the employer half being a deductible expense:

net earnings = net profit × 92.35%
Social Security = 12.4% × net earnings (up to the wage base)
Medicare = 2.9% × net earnings (no cap)

The Social Security wage base is shared with any W-2 job. If your wages already used up the base, only the Medicare part applies to your business earnings.

Half of the tax comes right back as a deduction when you figure your income tax.

On high incomes there's also a 0.9% Additional Medicare Tax. The threshold ($200,000 single, $250,000 married filing jointly) is reduced by your W-2 Medicare wages first.

Check my math: a worked example

$100,000 of net profit, no W-2 job, tax year 2026.

Net earnings: $100,000.00 × 92.35% = $92,350.00.
Social Security: 12.4% × $92,350.00 = $11,451.40.
Medicare: 2.9% × $92,350.00 = $2,678.15.
Self-employment tax: $14,129.55, and half of it — $7,064.78 — is deductible.
At a 22% bracket, income tax is roughly $20,445.75, so set aside about $34,575.30 (34.58% of profit).

These numbers come straight from the calculator using its example inputs — if the math ever changes, this example changes with it.

Mistakes I see a lot

Figuring 15.3% of the whole profit. It's 15.3% of 92.35% of profit — about 14.1% overall.
Forgetting W-2 wages. They share the Social Security wage base, so a high-paying day job can cut the tax a lot.
Forgetting the deduction for half of the SE tax. It lowers your income tax.
Not paying estimates. SE tax counts toward the estimated tax safe harbor just like income tax.
Expecting a loss to carry forward. For SE tax, each year stands alone.

Questions people ask

Why 92.35%?: An employer deducts its half of payroll tax as a business expense. The 92.35% (100% minus half of 15.3%) gives you the same break before the tax is figured.
Do I owe it if I made less than $400?: No. If net earnings (profit × 92.35%) are under $400, there's no self-employment tax. You might still owe income tax.
Does an S corporation avoid it?: An S corp owner-employee pays payroll tax on a reasonable salary instead, and the remaining profit isn't subject to SE tax. Whether that saves money after the extra payroll and filing costs depends on your numbers — talk to a CPA before switching.
What about the QBI deduction?: The qualified business income deduction lowers income tax, not self-employment tax. The income tax estimate here ignores it, so treat that number as a ceiling.

Assumptions and limits

Schedule SE, Part I: net earnings are 92.35% of net profit; no SE tax if that's under $400. Farm and nonfarm optional methods aren't modeled.
Social Security (12.4%) applies up to the year's wage base, reduced by W-2 Social Security wages and tips; Medicare (2.9%) has no cap.
Church employee income (from a church that elected out of FICA) is figured separately at 92.35% and isn't reduced by business losses.
Additional Medicare Tax (Form 8959, Part II): 0.9% on self-employment earnings over the threshold for your filing status, after subtracting W-2 Medicare wages. It's not part of the half-of-SE-tax deduction.
The deduction is half of Schedule SE line 12, an adjustment to income on Schedule 1.
The income tax estimate is rough: your bracket × (profit − the SE tax deduction). It ignores the QBI deduction, credits, and other income.

Ben’s notes on this

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Spot an error?

This is a public notebook and I do make mistakes. If a number looks off, tell me — I fix things and note the change in the changelog.

Disclaimer: Educational and planning use only. Results depend on what you enter and may not match your lender, your tax return, or professional accounting treatment. Informational content + opinions only — not tax/legal advice. Tax rules change and have exceptions this calculator doesn't cover — confirm current rules and your specific facts before relying on the result.