How is 2026 self-employment tax calculated?

SE tax is computed on 92.35% of your net profit. That base is taxed 12.4% for Social Security up to the $176,100 wage base and 2.9% for Medicare with no cap. On $80,000 of net profit, net earnings are $73,880, and SE tax is $11,303.

Why is only 92.35% of my profit taxed?

The 7.65% reduction mirrors the employer-side payroll deduction an employee would not pay tax on. Multiplying net profit by 0.9235 gives the net earnings figure that Schedule SE actually taxes, so a $100,000 profit is assessed on $92,350.

How does a W-2 job affect my SE tax?

Social Security tax stops at a combined $176,100 of wages plus net earnings. If your W-2 already paid Social Security on $100,000, only $76,100 of your self-employment net earnings can still be hit by the 12.4% Social Security portion; the 2.9% Medicare portion still applies to all of it.

Can I deduct part of my self-employment tax?

Yes. You deduct the employer-equivalent half of SE tax as an above-the-line adjustment to income. On an $11,303 SE tax bill, you deduct $5,652, which lowers your income tax even though it does not reduce the SE tax itself.

Self-Employment Tax Calculator (2026)

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Calculate your 2026 self-employment tax

If you earn 1099 or freelance income, you owe self-employment (SE) tax to cover both halves of Social Security and Medicare. This calculator applies the 2026 rates and wage base so you can size your bill before quarterly estimates come due.

How it works

SE tax is assessed on 92.35% of your net profit. That net-earnings figure is taxed at 12.4% for Social Security, but only up to the $176,100 wage base, and 2.9% for Medicare with no cap.

net earnings = net profit * 0.9235
SS tax       = min(net earnings, 176,100 - W-2 wages) * 0.124
Medicare tax = net earnings * 0.029
SE tax       = SS tax + Medicare tax
deductible half = SE tax / 2

Any W-2 wages already subject to Social Security reduce the remaining wage base for the 12.4% portion. You can deduct the employer-equivalent half of the SE tax as an adjustment to income.

Example

A freelancer has $80,000 of net profit and no W-2 job. Net earnings are 80,000 times 0.9235, or $73,880. Social Security tax is 73,880 times 0.124, or $9,161 (the wage base is not reached). Medicare tax is 73,880 times 0.029, or $2,143. Total SE tax is $11,303, and the deductible half is $5,652.

Notes

This is an estimate, not tax advice. It covers SE tax only, not your separate federal or state income tax, and ignores the 0.9% Additional Medicare Tax on high earners and the optional methods for low net earnings. Rates and the $176,100 wage base follow IRS and Social Security Administration figures for 2026; confirm with the IRS.