Guides / Taxes
Self-employment tax, explained
Social Security and Medicare, paid by you as both employee and employer.
Employees split Social Security and Medicare taxes with their employer. When you're self-employed, you pay both halves, as self-employment tax, on top of income tax.
The basics
- Self-employment tax is 15.3%: 12.4% for Social Security and 2.9% for Medicare
- It generally applies to 92.35% of your net self-employment earnings
- You generally owe it if net self-employment earnings are $400 or more
- The Social Security part only applies up to a yearly wage base; extra Medicare tax can apply at high incomes
- You can deduct half of it when figuring your income tax
Estimate yours
Our tax set-aside calculator estimates self-employment and income tax on your numbers.
General information, not tax advice. See IRS.gov. Pocket Change Pros isn't paid by any bank, software company or tax service.