Self-Employment Tax Set-Aside Calculator

Estimate how much to set aside for self-employment tax, using the standard IRS calculation: net earnings × 92.35%, then × 15.3% (12.4% Social Security + 2.9% Medicare). This is an estimate for planning purposes, not tax advice — the Social Security portion is capped at an annual wage base, and this doesn't include income tax.

Net Self-Employment Earnings ($)

Combined SE Tax Rate (%)

Two steps, and where the 92.35% comes from

The tool models the long-standing US self-employment tax structure: shrink the earnings to a taxable base, then apply the combined rate:

taxable base = net earnings × 92.35%
SE tax       = taxable base × rate (default 15.3%)
monthly      = SE tax ÷ 12

On $50,000 of net earnings the base is $46,175 and the tax $7,064.78, which is $588.73 a month. The 92.35% is 100% minus 7.65%, which strips the employer-equivalent half of the tax out of the base. The net effect is about 14.13% of net earnings.

What goes in the earnings box

Net, not invoiced. Net earnings are your business profit - revenue after deductible business expenses - so $62,000 invoiced with $12,000 of costs is $50,000 here.
The rate is editable for a reason. 15.3% is 12.4% Social Security plus 2.9% Medicare. The Social Security half only applies up to an annual wage base, so earnings above that threshold are nearer 2.9%; leaving 15.3% in the box overstates the bill for high earners.

Net earnings	Taxable base	SE tax at 15.3%
$20,000	$18,470	$2,825.91
$50,000	$46,175	$7,064.78
$80,000	$73,880	$11,303.64

This is Social Security and Medicare only. Federal and state income tax sit on top, the high-earner Medicare surcharge and the wage base cap are not modelled, and nothing here schedules quarterly estimated payments. Thresholds and rates change from year to year and none of this is tax advice - check the current figures with the IRS or your own accountant, and if you are outside the US your contributions work differently altogether.

Frequently asked questions

How much should I set aside for self-employment tax?

Roughly 14.13% of net earnings covers this part - $7,064.78 on $50,000, or $588.73 a month. Income tax is separate, so most freelancers park a noticeably larger share of each payment.

Why is self-employment tax calculated on 92.35% of earnings?

The 7.65% taken off represents the employer's half of Social Security and Medicare, which a self-employed person is paying anyway. Excluding it from the base stops the tax being charged on itself.

Do I owe it on gross freelance income?

No - it applies to profit. Deduct your allowable business expenses first, and enter that figure; putting your invoice total in the box will overstate what you owe, sometimes by thousands.