What is the self-employment tax rate?

Federal self-employment tax is 15.3% — 12.4% for Social Security and 2.9% for Medicare. It is charged on 92.35% of your net self-employment earnings, since that factor removes the employer-equivalent portion.

Does New Jersey have its own self-employment tax?

No. New Jersey does not impose a separate self-employment tax. Self-employed New Jersey residents pay the federal SE tax plus regular New Jersey state income tax on their net business income.

What is the Social Security wage base?

The 12.4% Social Security portion of SE tax only applies up to an annual wage-base cap, which is 168,600 dollars for 2024. The 2.9% Medicare portion has no cap, so it applies to all net earnings.

Can I deduct half of my SE tax?

Yes. You can deduct one-half of your federal self-employment tax as an above-the-line adjustment on your federal return, which lowers your federal taxable income. This calculator shows that deductible amount.

How accurate is this calculator?

It applies the standard federal SE formula and the New Jersey brackets for a close estimate. It does not include the additional 0.9% Medicare surtax on high earners or New Jersey credits, so confirm with a tax professional.

New Jersey Self-Employment Tax Calculator

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Self-employed New Jersey residents owe two separate taxes on their net business income: the federal 15.3% self-employment tax and regular New Jersey state income tax. This calculator computes both, applies the 92.35% net-earnings factor and the Social Security wage-base cap, and shows the deductible half of SE tax.

How it works

Self-employment tax in New Jersey is computed in three steps:

SE tax base. Multiply net self-employment income by 92.35%. This removes the employer-equivalent share so you are not taxed on it.
Apply the federal SE rate. The 12.4% Social Security portion applies only up to the wage-base cap ($168,600 for 2024); the 2.9% Medicare portion applies to all of the SE base with no cap. Together they total 15.3% below the cap.
Add New Jersey income tax. New Jersey has no separate SE tax, so your net business income is taxed under the regular state brackets. You can deduct half of the federal SE tax on your federal return.

Tips and example

For $60,000 of net self-employment income: the SE base is $60,000 x 0.9235 = $55,410. Federal SE tax at 15.3% is about $8,478, and half of that ($4,239) is deductible federally. New Jersey then taxes the income under its brackets, adding roughly $1,700 in state tax.

Set money aside quarterly — self-employed filers generally owe estimated taxes four times a year. High earners should also remember the extra 0.9% Medicare surtax above the threshold, which this tool does not model.