Freelance Tax Calculator
Estimate your self-employment tax, federal income tax, and quarterly payments as a freelancer or independent contractor.
How Freelance Taxes Work
As a freelancer or independent contractor, you're responsible for paying both income tax and self-employment tax on your net earnings. Unlike W-2 employees who split payroll taxes with their employer, you pay the full 15.3% self-employment tax yourself, covering both Social Security and Medicare.
Self-Employment Tax Calculation
Self-employment tax is calculated on 92.35% of your net income (gross income minus business expenses). The rate is 15.3%, which includes 12.4% for Social Security (on income up to $168,600 for 2024) and 2.9% for Medicare (no income cap). An additional 0.9% Medicare surtax applies on earnings above $200,000 for single filers.
Federal Income Tax Brackets (2024)
This calculator uses the 2024 federal tax brackets to estimate your income tax. Your taxable income is reduced by the standard deduction ($14,600 single / $29,200 married filing jointly) and half of your self-employment tax. Income is taxed progressively — only the income within each bracket is taxed at that bracket's rate.
Reducing Your Tax Burden
Maximize your business deductions to lower both income tax and self-employment tax. Consider contributing to a Solo 401(k) or SEP-IRA, which can shelter up to $69,000 per year. An S-corp election may reduce SE tax if your income is high enough. Work with a tax professional to optimize your strategy.
Frequently Asked Questions
What is self-employment tax?
Self-employment tax covers Social Security (12.4%) and Medicare (2.9%) taxes. Employees split these with their employer, but freelancers pay both halves — 15.3% total. It's calculated on 92.35% of your net self-employment income. You can deduct half of your SE tax from your adjusted gross income.
Do I need to make quarterly estimated payments?
Yes. If you expect to owe $1,000 or more in taxes for the year, the IRS requires quarterly estimated tax payments. Due dates are April 15, June 15, September 15, and January 15 of the following year. Missing payments can result in underpayment penalties.
What business expenses can I deduct?
Common freelance deductions include: home office (dedicated space), internet and phone (business portion), computer and software, professional development, health insurance premiums, business travel, marketing costs, and professional services (accountant, lawyer). Keep receipts for everything.
How is this different from W-2 employee taxes?
As a freelancer, you pay both the employer and employee portions of Social Security and Medicare (15.3% vs 7.65%). However, you can deduct business expenses that employees cannot, and you can deduct half of your self-employment tax. You also don't have taxes automatically withheld, so you must make quarterly payments.