1099 Tax Calculator
Figure out exactly how much of your 1099 income to set aside for taxes. This calculator adds up your self-employment tax, federal income tax, and state income tax - after business expenses, the QBI deduction, health insurance, and retirement - then shows a quarterly estimate. Figures are for US tax year 2025.
How 1099 taxes are calculated
As a 1099 contractor, no employer withholds tax for you, so it helps to know your total bill up front. Your 1099 tax is the sum of three pieces:
- Self-employment tax - 15.3% (12.4% Social Security + 2.9% Medicare) on 92.35% of your net profit, with the Social Security portion capping at $176,100 for 2025.
- Federal income tax - the 2025 marginal brackets (10% to 37%) applied to your taxable income after the standard deduction and the QBI deduction.
- State income tax - your state's effective rate applied to taxable income (nine states have no income tax).
Deductions that lower your bill
- Business expenses reduce your net profit directly - the single biggest lever for most freelancers.
- Half of your SE tax is deductible above the line.
- The QBI deduction can remove up to 20% of qualified business income, subject to the 2025 service-business phase-out.
- Self-employed health insurance and retirement contributions (SEP-IRA or Solo 401(k)) are deductible above the line.
A rule of thumb for what to set aside
Many freelancers aim to set aside 25-35% of their net profit for taxes. Lower earners and those in no-income-tax states land near the bottom of that range; higher earners and those in high-tax states land at the top. Rather than guess, use the headline figure above - it's tuned to your income, filing status, deductions, and state - and move that share into a separate account each time you're paid.
Frequently asked questions
How much should I set aside for 1099 taxes? +
A common rule of thumb is to set aside 25-35% of your net profit for taxes, but the exact figure depends on your income, filing status, deductions, and state. This calculator gives you a precise 2025 estimate of your total tax (self-employment tax + federal income tax + state) and the percentage to save.
What taxes do 1099 contractors pay? +
Three layers: self-employment tax (15.3% Social Security and Medicare on 92.35% of net profit), federal income tax (the 2025 marginal brackets after the standard deduction and QBI), and state income tax based on your state's effective rate. There is no employer withholding, so you're responsible for all of it.
What can I deduct as a 1099 worker? +
Business expenses reduce your net profit directly. You can also deduct half of your self-employment tax, self-employed health insurance premiums, and retirement contributions (SEP-IRA or Solo 401(k)) above the line, plus the QBI deduction of up to 20% of qualified business income. This calculator applies all of these.
What is the QBI deduction? +
The Qualified Business Income (Section 199A) deduction lets many self-employed people deduct up to 20% of their business income. For 2025 it begins to phase out for service businesses (consulting, design, law, health, finance) once taxable income exceeds $197,300 (single) or $394,600 (married filing jointly). Toggle the service-business checkbox to model it.
Do I have to pay 1099 taxes quarterly? +
Usually yes. If you expect to owe $1,000 or more, the IRS expects quarterly estimated payments (due mid-April, June, September, and the following January). The calculator divides your estimated total tax by four to show a quarterly figure. A common safe harbor is paying 100% of last year's tax (110% if prior-year income exceeded $150,000).
Is this tax advice? +
No. This is an educational estimate for tax year 2025 using federal rules and an effective state rate you provide. It does not model every credit, the AMT, local taxes, or full state brackets. Always confirm important decisions with a qualified tax professional.
Plan your quarterly payments
Break your annual bill into the four estimated payments the IRS expects - and never get surprised at tax time.
Open the quarterly tax calculatorMore tax tools
Break down the 15.3% SE tax on your net profit.
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