Self-Employment Tax 2026: Rates, Deductions, and Deadlines
When you work for yourself, you pay both halves of Social Security and Medicare — the employee share and the employer share — under the name self-employment tax. For most people it works out to 15.3% of net earnings, and it comes due even when you owe no income tax. Here is exactly how it works for 2026.
Who owes self-employment tax
Anyone with $400 or more of net self-employment earnings for the year owes SE tax — sole proprietors, single-member LLC owners, freelancers, and independent contractors. Net earnings is roughly your profit after business expenses. If you also have a W-2 job, the Social Security portion of SE tax applies only to the income above what your job already covered, up to the wage base.
The 2026 rates
| Component | Rate | 2026 detail |
|---|---|---|
| Social Security | 12.4% | applies to net earnings up to the $184,500 wage base |
| Medicare | 2.9% | no cap — applies to all net earnings |
| Additional Medicare | 0.9% | extra on net earnings above $200,000 (single) or $250,000 (joint) |
One subtlety: the IRS applies the rates to 92.35% of your net profit, not the full amount — the adjustment approximates the deduction a W-2 worker gets because their employer’s half is not taxable income to them.
A worked example
Take a freelancer with $50,000 of net profit in 2026:
| Step | Calculation | Amount |
|---|---|---|
| Net earnings | $50,000 × 92.35% | $46,175 |
| Social Security | 12.4% of $46,175 | $5,726 |
| Medicare | 2.9% of $46,175 | $1,339 |
| Total SE tax | $7,065 |
On a $100,000 profit the numbers scale up fast: Social Security is capped at $184,500 of net earnings, but the 2.9% Medicare applies to everything, and the extra 0.9% kicks in above $200,000 of net earnings (single) or $250,000 (joint).
The deductions that soften the blow
First, you may deduct half of your self-employment tax — the “employer” share — as an adjustment to income, reducing your income tax bill. Second, qualified business income (QBI) from a sole proprietorship or pass-through entity may qualify for the up-to-20% QBI deduction, which lowers taxable business income directly. Both apply even if you take the standard deduction.
Pay as you go: estimated taxes
Self-employed workers pay income tax and SE tax through quarterly estimated payments — there is no employer withholding. For tax year 2026 the due dates are April 15, June 15, and September 15, 2026, and January 15, 2027; the 2026 return itself is due April 15, 2027. To avoid an underpayment penalty, pay at least 100% of last year’s tax (110% if your prior-year AGI was over $150,000) or 90% of this year’s tax across the four payments. A common mistake is skipping the January 15 payment because it is “next year” — the penalty math does not care about the calendar year boundary.
Why it hits harder than a paycheck job
A W-2 employee pays 7.65% and their employer silently pays the other 7.65%. As a self-employed person you pay both halves — which is why the right structure matters: a solo 401(k) or HSA contribution reduces the income you are taxed on, and hiring through an S-corp or a spouse payroll arrangement can change the SE tax picture entirely. Those moves are worth a conversation with a tax professional.
Run the numbers
Use our self-employment tax calculator to see your exact Social Security, Medicare, and total SE tax. Then set your payments with the estimated quarterly tax calculator, see how the numbers flow into your overall bill with the federal income tax calculator, and cut taxable income with the solo 401(k) calculator. Need the bracket context? Read our 2026 tax brackets guide.