How the 1099 tax calculator works
When you work as a freelancer or independent contractor, clients report what they paid you on Form 1099-NEC and nothing is withheld. You owe three layers of tax on your net profit: federal self-employment tax, federal income tax and, in most states, state income tax.
Self-employment tax is the Social Security and Medicare tax an employer would normally split with you. As a freelancer you pay both halves on Schedule SE, on 92.35% of your net profit:
Federal income tax then applies to what is left after three deductions: half of your self-employment tax, the standard deduction ($16,100 single, $32,200 married filing jointly in 2026) and, for most freelancers, the 20% qualified business income (QBI) deduction:
- SE
- Self-employment tax: Social Security plus Medicare on 92.35% of net profit
- QBI
- Qualified business income deduction: up to 20% of business profit, capped at 20% of taxable income
High earners also owe the 0.9% Additional Medicare Tax on self-employment earnings above $200,000 (single) or $250,000 (joint). The QBI deduction starts to phase out once taxable income passes $201,750 (single) and is gone $75,000 later; the calculator phases it out as for a business with no employees. For a specified service business, such as consulting, only the applicable percentage of the income counts in that range as well (IRC 199A(d)(3)), so the deduction shrinks faster; switch it on in the calculator. It also applies the $400 minimum deduction that starts in 2026 for anyone with at least $1,000 of qualified business income.
The estimate leaves out deductions that depend on your situation, such as the new deduction for people 65 and older (up to $6,000 each, 2025 through 2028) and the deduction for qualified tips.
State income tax
Each state sets its own rules. 9 states have no personal income tax (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming), although some tax business income or receipts in other ways, which their pages explain; the rest use a flat rate or graduated brackets with their own deductions and exemptions. Choose your state above to apply its rules, or open its page from the table below.
Worked example: $100,000 of freelance profit in six states
A single freelancer with $100,000 of net profit owes $14,129.55 of self-employment tax and $8,235.00 of federal income tax wherever they live. State income tax is what separates the totals:
| State | State income tax | Total tax | Effective rate |
|---|---|---|---|
| Texas | $0.00 | $22,364.55 | 22.4% |
| Florida | $0.00 | $22,364.55 | 22.4% |
| Pennsylvania | $2,853.11 | $25,217.66 | 25.2% |
| Illinois | $4,455.51 | $26,820.06 | 26.8% |
| California | $4,413.39 | $26,777.94 | 26.8% |
| New York | $4,442.93 | $26,807.48 | 26.8% |
Self-employment tax surprises many new freelancers: at $100,000 it costs more than federal income tax, because it applies from the first dollar of profit without a standard deduction.
State income tax on freelance income, state by state
The table estimates state income tax on $100,000 of freelance profit for a single filer in every state and D.C., using each state's 2026 brackets, deductions and exemptions. Select a state for its full calculator and breakdown.
| State | Tax structure | State tax | Total tax |
|---|---|---|---|
| Alabama | Graduated | $4,381.76 | $26,746.31 |
| Alaska | No income tax | $0.00 | $22,364.55 |
| Arizona | Flat rate | $1,920.88 | $24,285.43 |
| Arkansas | Graduated | $3,238.31 | $25,602.86 |
| California | Graduated | $4,413.39 | $26,777.94 |
| Colorado | Flat rate | $3,380.75 | $25,745.30 |
| Connecticut | Graduated | $4,361.44 | $26,725.99 |
| Delaware | Graduated | $4,792.72 | $27,157.27 |
| Florida | No income tax | $0.00 | $22,364.55 |
| Georgia | Flat rate | $3,888.97 | $26,253.52 |
| Hawaii | Graduated | $5,259.33 | $27,623.88 |
| Idaho | Flat rate | $3,817.28 | $26,181.83 |
| Illinois | Flat rate | $4,455.51 | $26,820.06 |
| Indiana | Flat rate | $2,712.09 | $25,076.64 |
| Iowa | Flat rate | $2,879.74 | $25,244.29 |
| Kansas | Graduated | $4,386.10 | $26,750.65 |
| Kentucky | Flat rate | $3,135.13 | $25,499.68 |
| Louisiana | Flat rate | $2,401.81 | $24,766.36 |
| Maine | Graduated | $4,623.67 | $26,988.22 |
| Maryland | Graduated | $4,050.80 | $26,415.35 |
| Massachusetts | Graduated | $4,426.76 | $26,791.31 |
| Michigan | Flat rate | $3,699.00 | $26,063.55 |
| Minnesota | Graduated | $4,796.20 | $27,160.75 |
| Mississippi | Flat rate | $2,985.41 | $25,349.96 |
| Missouri | Graduated | $3,430.62 | $25,795.17 |
| Montana | Graduated | $3,889.94 | $26,254.49 |
| Nebraska | Graduated | $3,349.01 | $25,713.56 |
| Nevada | No income tax | $0.00 | $22,364.55 |
| New Hampshire | No income tax | $0.00 | $22,364.55 |
| New Jersey | Graduated | $3,730.02 | $26,094.57 |
| New Mexico | Graduated | $3,222.93 | $25,587.48 |
| New York | Graduated | $4,442.93 | $26,807.48 |
| North Carolina | Flat rate | $3,199.39 | $25,563.94 |
| North Dakota | Graduated | $553.02 | $22,917.57 |
| Ohio | Flat rate | $1,773.34 | $24,137.89 |
| Oklahoma | Graduated | $3,636.58 | $26,001.13 |
| Oregon | Graduated | $7,302.21 | $29,666.76 |
| Pennsylvania | Flat rate | $2,853.11 | $25,217.66 |
| Rhode Island | Graduated | $2,868.20 | $25,232.75 |
| South Carolina | Graduated | $3,846.59 | $26,211.14 |
| South Dakota | No income tax | $0.00 | $22,364.55 |
| Tennessee | No income tax | $0.00 | $22,364.55 |
| Texas | No income tax | $0.00 | $22,364.55 |
| Utah | Flat rate | $4,135.62 | $26,500.17 |
| Vermont | Graduated | $3,673.52 | $26,038.07 |
| Virginia | Graduated | $4,529.68 | $26,894.23 |
| Washington | No income tax | $0.00 | $22,364.55 |
| West Virginia | Graduated | $3,367.33 | $25,731.88 |
| Wisconsin | Graduated | $4,008.16 | $26,372.71 |
| Wyoming | No income tax | $0.00 | $22,364.55 |
| District of Columbia | Graduated | $4,930.99 | $27,295.54 |
These are estimates: they leave out local income taxes, credits other than personal credits, and a number of state-specific phase-outs. Each state page lists the details that matter there.
Paying 1099 taxes during the year
Because nothing is withheld from freelance income, the IRS expects estimated payments on Form 1040-ES once you expect to owe $1,000 or more for the year. For 2026, the four payments are due April 15, June 15 and September 15, 2026, and January 15, 2027. Paying at least 90% of this year's tax, or 100% of last year's (110% if your AGI was above $150,000), generally avoids an underpayment penalty even if you owe more when you file. States with an income tax run their own estimated payment programs, usually on the same schedule.
That safe harbor can be smaller than the tax you will actually owe. On $100,000 of profit in Texas, this year's federal tax is $22,364.55, so 90% of it is $20,128.10. If last year's tax was $15,000, paying $15,000.00 in four installments of $3,750.00 avoids the penalty, and the rest is due with the return in April. Had last year's AGI been over $150,000, the 110% rule would make it $16,500.00. Turn on “Use your 2025 tax” in the calculator to see your own figure.
Ways to lower the bill
- Deduct every business expense. Each dollar of expense lowers self-employment, federal and state income tax together, which is why the calculator asks for expenses separately.
- Use retirement accounts built for the self-employed. SEP-IRA and solo 401(k) contributions reduce income tax, and self-employed health insurance premiums are deductible too.
- Set money aside as you are paid. Moving your tax percentage into a high-yield savings account earns interest until each quarterly due date; a short Treasury bill pays interest that is exempt from state income tax.
The bottom line
Your 1099 tax has three parts: self-employment tax, federal income tax and, in most states, state income tax. On $100,000 of profit in Texas, which has no income tax, the federal share alone is $22,364.55, 22.4% of profit; state tax adds anywhere from nothing to several thousand dollars more.
Choose your state in the 1099 tax calculator for its exact brackets, set aside your percentage from every payment, and pay estimated taxes quarterly so April holds no surprises.
Frequently asked questions
How much should I set aside for taxes on 1099 income?
Many freelancers set aside 25% to 30% of each payment, but the right share depends on your profit and state. A single freelancer with $100,000 of net profit and no state income tax owes about $22,364.55 (22.4%); in a high-tax state the total can be several thousand dollars more. Use the calculator with your state selected for a precise figure.
What is the self-employment tax rate for 2026?
The self-employment tax rate is 15.3%: 12.4% for Social Security and 2.9% for Medicare, applied to 92.35% of your net profit. In 2026 the Social Security part applies to the first $184,500 of net earnings, and an extra 0.9% Medicare tax applies above $200,000 for single filers. You can deduct half of your self-employment tax when calculating income tax.
Do I have to pay quarterly estimated taxes as a freelancer?
Generally yes, if you expect to owe $1,000 or more in federal tax for the year after withholding and credits. Payments for the 2026 tax year are due April 15, June 15 and September 15, 2026, and January 15, 2027. Most states with an income tax have a similar requirement.
How does the safe harbor estimated tax rule work?
The safe harbor estimated tax rule says you avoid the federal underpayment penalty if, by each due date, you have paid a quarter of the smaller of 90% of this year's tax and 100% of last year's tax (110% if last year's AGI was over $150,000, or $75,000 if married filing separately). Last year's return must cover a full 12 months. You still owe any balance when you file.
What is the 110% rule for estimated taxes?
Under the 110% rule, if the adjusted gross income on last year's return was more than $150,000 ($75,000 if you are married filing separately), the prior-year safe harbor is 110% of last year's tax instead of 100%. Paying 90% of this year's tax still works as the other safe harbor, whichever is smaller.
How do I avoid an underpayment penalty as a freelancer?
Pay estimated tax in four installments that add up to at least the safe harbor amount, each by its due date (April 15, June 15 and September 15, 2026, and January 15, 2027 for 2026). The underpayment penalty is figured installment by installment, so paying late in the year doesn't cancel it for earlier quarters. You don't have to pay estimated tax if you expect to owe less than $1,000 after withholding and credits, or if you had no tax liability for a full 12-month prior year.
Does it matter if I'm a consultant or other service business?
Only at higher incomes. Consulting, law, accounting, health, financial services, performing arts and the other specified service fields in IRC 199A(d)(2) get the full QBI deduction while taxable income is $201,750 or less ($403,500 joint). Over the next $75,000 ($150,000 joint), only part of a specified service business's income counts, so its deduction shrinks faster than another business's, and above that range it gets none. The calculator asks whether your business is one and shows a reminder when your income is in that range.
What is the QBI deduction?
The qualified business income deduction lets many self-employed people deduct up to 20% of their business profit from federal taxable income, capped at 20% of taxable income. Above an income threshold ($201,750 single and $403,500 joint for 2026) it phases out over the next $75,000 ($150,000 joint) for specified service businesses, such as consulting, and for other businesses it becomes limited by the W-2 wages they pay and the property they own, so a freelancer with no employees loses it at higher incomes. Starting in 2026, at least $1,000 of qualified business income from a business you actively run allows a minimum deduction of $400. It reduces federal income tax only, not self-employment tax.
Which states have no income tax for freelancers?
Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming have no personal income tax, although some tax businesses in other ways: New Hampshire's Business Profits Tax applies above $109,000 of gross business income, Tennessee's business tax requires a return from $100,000 of gross receipts, and Washington's B&O tax applies to the gross income of businesses, sole proprietors included. New Hampshire's tax on interest and dividends ended after 2024, and Washington taxes only certain capital gains. Freelancers in these states still owe federal self-employment and income tax.
Is a 1099 freelancer's tax different from an employee's?
Income tax works the same way, but a freelancer pays both halves of Social Security and Medicare (15.3%) instead of the 7.65% employees see on their pay stubs, and nothing is withheld, so you make estimated payments yourself. In return, you can deduct business expenses, half of your self-employment tax and often the QBI deduction.
Sources and further reading
- Self-employment tax (Social Security and Medicare taxes) (opens in a new tab), Internal Revenue Service
- IRS releases tax inflation adjustments for tax year 2026, including amendments from the One, Big, Beautiful Bill (opens in a new tab), Internal Revenue Service
- Qualified business income deduction (opens in a new tab), Internal Revenue Service
- Estimated taxes (opens in a new tab), Internal Revenue Service
- Contribution and benefit base (opens in a new tab), Social Security Administration
- 2026 State Income Tax Rates and Brackets (opens in a new tab), Tax Foundation
- 2026 Form 1040-ES, Estimated Tax for Individuals (opens in a new tab), Internal Revenue Service
- 26 U.S. Code § 6654, Failure by individual to pay estimated income tax (opens in a new tab), Legal Information Institute, Cornell Law School
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