Who pays it, and the $400 line
IRS Topic 554 describes the people the tax covers: a sole proprietor, including an independent contractor, a partner, a member of a limited liability company taxed as a partnership, and the member of a disregarded single-member limited liability company. You generally pay it if net earnings from self-employment are $400 or more. The tax is due even if you already receive Social Security benefits, and it is due however old you are. A freelancer who is paid on invoices, with no employer withholding, is the usual case this page is written for.
Net profit, in the ordinary sense of the business, is receipts minus ordinary and necessary expenses. The calculator starts from that profit. It does not list the expenses for you, and it does not apply the qualified business income deduction. A loss is treated as zero for this tax. The optional farm and nonfarm methods in Part II of Schedule SE, which can produce a small amount of coverage when profits are low, are not applied. Church-employee income of $108.28 is a separate rule and is not applied either.
Why the base is 92.35 percent
Topic 554 says the amount subject to self-employment tax is generally 92.35 percent of net earnings. That step is what Schedule SE then calls net earnings from self-employment. On a profit of $100,000 the result is $92,350. The 92.35 percent factor stands in for the deductible employer-equivalent half. One-half of the computed self-employment tax is also deductible when you figure adjusted gross income. The calculator shows that half. It does not subtract the half before it computes the tax, and it does not feed the half into an income-tax calculation. Doing both the 92.35 percent step and a second reduction of the tax base would double-count the adjustment.
If net earnings are under $400, the tax on this page is zero. A profit of $400 produces net earnings of $369.40, which is under the line, so the tax is zero. A profit of $300 is further under. The page does not switch on the optional methods to create a tax below that line.
The 2026 rates and a W-2 job beside the business
The rate on net earnings is the combined employer and employee rate. Topic 751 states Social Security at 12.4 percent in total and Medicare at 2.9 percent in total. Only Social Security has a wage base. For earnings in 2026 that base is $184,500. Medicare has no cap. On the $100,000 example, Social Security is 12.4 percent of $92,350, which is $11,451.40, and Medicare is 2.9 percent of $92,350, which is $2,678.15. Self-employment tax is the sum, $14,129.55. Half of that, the deductible half, is $7,064.78.
Wages from a job use up the Social Security wage base before the business does. If W-2 wages have already been taxed for Social Security, only the leftover room is taxed again on the Schedule SE Social Security line. The form takes one figure for those W-2 wages and uses it both as Social Security wages and as Medicare wages, which is the usual case when the job withheld both. On a $50,000 profit beside $200,000 of W-2 wages, net earnings are $46,175, the Social Security room is zero, and Social Security tax on the business is zero. Medicare at 2.9 percent is still due on the whole $46,175, which is $1,339.08.
Additional Medicare Tax is 0.9 percent and it is not part of the 15.3 percent. Topic 560 sets the thresholds at $250,000 for married filing jointly, $125,000 for married filing separately, and $200,000 for single people, heads of household, and qualifying surviving spouses. This page uses $200,000 for both single and head of household. Medicare wages reduce the threshold for the self-employment portion, but not below zero. A single person with $200,000 of Medicare wages has no threshold left, so the 0.9 percent applies to all $46,175 of the example above, which is $415.58. Additional Medicare Tax is not cut in half by the deductible-half rule. It is computed on Form 8959, not on Schedule SE.
What a freelancer still has to do elsewhere
Federal income tax on the profit, including any qualified business income deduction and the standard deduction, lives on Form 1040. The paycheck calculator on this site is for wages, and its brackets are not applied to self-employment profit here. Estimated tax payments during the year are how many self-employed people pay both the income tax and the self-employment tax. This page does not divide the total into quarterly vouchers, because the safe-harbor rules depend on last year's tax. The $100,000 example is the one to memorise against the calculator: net earnings $92,350, Social Security $11,451.40, Medicare $2,678.15, self-employment tax $14,129.55, and a deductible half of $7,064.78, with no Additional Medicare Tax while the single threshold of $200,000 is untouched. Change the W-2 box and the Social Security room shrinks first. Medicare at 2.9 percent does not.
A loss in one business can offset profit in another before Schedule SE sees a combined figure. The calculator takes the net profit you type and does not combine businesses. Ministers and members of religious orders can have an exemption if the IRS has approved Form 4361. State tax is not included. The number to take from this guide is the Schedule SE shape for 2026: 92.35 percent, then 12.4 percent up to what is left of $184,500, then 2.9 percent on all of it, then 0.9 percent only past the Topic 560 threshold. A profit that produces net earnings under $400 stays at zero self-employment tax on this page.