Freelance Tax Estimator

Freelance Tax Estimator

Don't get caught by the IRS. Estimate your quarterly payments accurately.

Enter 0 for no state tax (TX, FL, WA, etc.)

How This Tool Works

The Freelance Tax Estimator is designed to help self-employed professionals calculate their Estimated Quarterly Tax Payments. Unlike traditional employees (W-2), freelancers are responsible for paying their own Social Security, Medicare, and Income taxes directly to the IRS and state authorities.

This tool calculates your Net Profit (Revenue - Expenses) and applies the standard 15.3% Self-Employment tax before estimating your federal and state income tax brackets. It provides both an annual total and the specific amount you should set aside for each quarterly deadline.

How to Use the Estimator

  • Annual Revenue: Enter your projected total income for the year.
  • Annual Expenses: Enter deductible business costs (software, equipment, health insurance).
  • Filing Status: Select your tax filing status, as this drastically changes your federal tax brackets.
  • State Tax Rate: Enter your local state's average income tax rate. If you live in a state with no income tax (like TX or FL), enter 0.

Example Calculation

If you earn $100,000 with $10,000 in expenses (Single filer, 5% state tax):

  • Net Profit: $90,000
  • Self-Employment Tax: ~$12,717
  • Federal Income Tax (Est): ~$10,400
  • State Tax (5%): $4,500
  • Total Annual Liability: ~$27,617
  • Recommended Quarterly Payment: $6,904

Why This Tool Is Accurate

We use a comprehensive approach to self-employment tax logic:

  • SE Tax Base: We calculate SE tax on 92.35% of your net profit, mirroring the actual IRS Schedule SE logic.
  • Deduction Adjustments: The tool automatically accounts for the half-SE-tax deduction when calculating federal income tax liability.
  • Progressive Brackets: We use simplified progressive bracket logic to ensure that higher earners see higher effective tax rates, rather than just a flat percentage.

Frequently Asked Questions

Why do I have to pay taxes quarterly as a freelancer?

The U.S. tax system is "pay-as-you-go." Since you don't have an employer withholding taxes from every paycheck, the IRS requires you to make estimated payments four times a year if you expect to owe $1,000 or more.

What is Self-Employment Tax?

Self-Employment (SE) tax consists of Social Security and Medicare taxes. It is currently 15.3% of your net earnings. As a freelancer, you pay both the employee and employer portions of these taxes.

How can I lower my quarterly tax payments?

You can lower your tax liability by maximizing your business deductions. Every dollar you spend on valid business expenses (software, equipment, home office) reduces your taxable net profit.
Limitations & Disclaimer: This tool is an estimator and not a substitute for professional tax advice or a proper tax return (Form 1040-ES). Tax laws and brackets change frequently. Always consult a certified CPA or tax advisor for official calculations.