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1099 Tax Calculator
Earned 1099 income this year — freelancing, contracting, gig work? Nobody withheld taxes for you. This free calculator estimates your federal self-employment tax and income tax, and shows how much to set aside for each quarterly payment.
How 1099 taxes work
When a client pays you as a 1099 contractor, no taxes come out. That feels great in January and terrible in April, because the IRS still expects its share — roughly 15.3% for self-employment tax on top of your regular income tax. W-2 employees never see this: their employer withholds income tax every paycheck and quietly pays half of payroll tax. As a 1099 worker, both jobs are yours.
Self-employment tax is 12.4% for Social Security plus 2.9% for Medicare — 15.3% total — applied to 92.35% of your net profit (profit after business expenses). The 92.35% adjustment exists because employees never pay payroll tax on the employer's half; the formula gives contractors roughly equivalent treatment. On top of that you owe federal income tax at your rate, and possibly state tax.
Because nothing is withheld, the IRS wants you to pay as you go in four quarterly estimated payments: April 15, June 15, September 15, and January 15. If you expect to owe $1,000 or more for the year, quarterly payments are effectively required — skipping them can trigger an underpayment penalty. A practical habit: move each payment amount into a separate savings account the day client money lands, so April never surprises you.
This is a planning estimate, not a tax return. It does not apply the Social Security wage cap, tax credits, filing-status differences, or the deductible half of self-employment tax against income tax, and it cannot see state-specific rules. Use it to set aside the right ballpark each quarter, and confirm final numbers with a tax professional or tax software before you file.
1099 tax questions, answered
How much should I set aside from 1099 income for taxes?
A common rule of thumb is 25–30% of net profit: 15.3% self-employment tax (on 92.35% of profit) plus your income-tax rate. Enter your numbers in the calculator above for a personalized estimate.
What is self-employment tax?
It is the 1099 worker's version of payroll tax: 12.4% Social Security + 2.9% Medicare = 15.3%, applied to 92.35% of net self-employment profit. W-2 employees split this cost with their employer; as a 1099 contractor, you pay both halves.
Do I have to pay quarterly estimated taxes?
Generally yes, if you expect to owe $1,000 or more in tax for the year after withholding and credits. The IRS operates pay-as-you-go; waiting until April can trigger an underpayment penalty.
When are quarterly estimated payments due?
April 15, June 15, September 15, and January 15 of the following year. If a date falls on a weekend or holiday, the deadline shifts to the next business day.
What's the difference between 1099 and W-2 taxes?
With W-2 work, your employer withholds income tax and pays half your payroll tax (7.65%). With 1099 work, nothing is withheld and you owe the full 15.3% self-employment tax yourself, plus income tax — usually paid through quarterly estimates.
Can I deduct half of my self-employment tax?
Yes. You may deduct one-half of self-employment tax from your income when figuring income tax. It does not reduce the self-employment tax itself.
What happens if I skip quarterly payments?
You may owe an underpayment penalty plus interest when you file. The per-payment amounts from the calculator above are designed to keep you current through the year.
Will I get a 1099-K from payment apps in 2026?
Probably not unless you are a high-volume seller. The federal 1099-K threshold stays at more than $20,000 in payments and more than 200 transactions in 2026 — both must be met, and the planned drop to $600 was scrapped. So $30,000 across 150 sales triggers no form, and neither does $15,000 across 300 sales. Two caveats: some states keep their own $600 trigger, so a form can still arrive below the federal line — and every dollar of income is taxable whether or not a platform sends you a form.