Know what you owe on your side hustle
Self-employment tax, federal tax, state tax—calculated in seconds. No signup. No BS.
Over 41 million Americans earn side hustle income. If you're one of them, you need to know that 1099 income is taxed differently than W-2 wages. Our free calculator shows you exactly what you'll owe—including the 15.3% self-employment tax that catches many freelancers off guard.
Last updated: January 2026 · Data from IRS Rev Proc 2024-40
Three taxes on your side income
When you earn money from a side hustle, freelancing, or gig work, you're considered self-employed by the IRS. This means your income is taxed differently than traditional W-2 wages from an employer.
Understanding these three tax components helps you plan ahead, avoid surprises at tax time, and potentially reduce your tax burden through legitimate deductions and strategies.
15.3% for Social Security (12.4%) and Medicare (2.9%). You pay both halves—the employer and employee portions—calculated on 92.35% of net earnings.
The Social Security portion applies only to earnings up to $176,100 in 2025. Medicare has no cap and adds 0.9% on income over $200,000.
10-37% based on your total taxable income from all sources. Your side hustle income is added to your W-2 income to determine your tax bracket.
The QBI deduction lets you deduct up to 20% of qualified business income, significantly reducing your federal tax on side hustle earnings.
Varies by state from 0% to 13.3%. Nine states have no income tax at all, while others like California and New York have progressive systems with higher rates.
Some states also have local income taxes that add another layer, particularly in cities like New York City and Philadelphia.
Quarterly estimated tax payments
If you expect to owe $1,000 or more in taxes for the year, the IRS requires you to make quarterly estimated tax payments. Missing these deadlines results in penalties and interest charges.
Side hustle tax FAQ
How much tax do I pay on side hustle income?
Side hustle income is subject to three taxes: self-employment tax (15.3% for Social Security and Medicare), federal income tax (10-37% depending on your bracket), and state income tax (0-13.3% depending on your state). Our calculator estimates all three based on your specific situation.
What is self-employment tax?
Self-employment tax is 15.3% of your net self-employment earnings (calculated on 92.35% of your profit). It covers Social Security (12.4%) and Medicare (2.9%). Unlike W-2 employees who split this with their employer, self-employed individuals pay both halves.
Do I need to pay quarterly estimated taxes?
If you expect to owe $1,000 or more in taxes for the year, the IRS requires quarterly estimated tax payments. The due dates are April 15, June 15, September 15, and January 15. Missing these deadlines can result in penalties and interest.
What is the QBI deduction?
The Qualified Business Income (QBI) deduction allows eligible self-employed individuals to deduct up to 20% of their qualified business income from their federal taxes. This can significantly reduce your tax bill if you qualify.
Which states have no income tax on side hustles?
Nine states have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. If you live in one of these states, you only pay federal self-employment tax and federal income tax on your side hustle earnings.
State-specific tax calculators
Each state has different tax rates and rules. Use our state-specific calculators for detailed breakdowns tailored to where you live.
Every state calculates differently
The calculator above supports all 50 states. Below are our dedicated state guides with detailed breakdowns, examples, and FAQs.
More state guides coming soon. Use the calculator above for instant estimates for any state—it supports all 50 states plus DC.
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This calculator provides estimates for informational purposes only. For personalized advice, consult a qualified tax professional.
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