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What is the Self-Employment Tax Rate?

how are self employment taxes calculated

By Jean Murray. US Business Law / Taxes Expert

Jean Murray has the education and experience to help you become an expert in your small business, and to provide you with information about business legal and tax issues. With an MBA and a PhD in entrepreneurship, she brings almost 30 years of experience and knowledge to these important business subjects.

You can also read more about Jean's current and past work on her page.

DISCLAIMER: I am not a CPA or attorney, and nothing on this site in articles, emails, blog posts, or other communications is intended to be tax or legal advice. The purpose of this site is to provide general information to readers. No claim is made regarding the accuracy or legal status of information on this

site. Federal, state, and local laws and regulations change, and every business situation is unique. Readers should not take action on any tax or legal matter without reviewing options with a tax advisor or attorney.

Question: What is the Self-Employment Tax Rate?

Answer: The Social Security tax rate currently is 15.3 percent on self-employment income. The rate consists of two parts: 12.4% for social security (old-age, survivors, and disability insurance) and 2.9% for Medicare (hospital insurance).

The Social Security portion is taxed up to the Social Security maximum for each year. If your net earnings exceed the maximum, you continue to pay only the Medicare portion of the self-employment tax. The Social Security annual maximum applies to all income, including self-employment income and wages or salaries earned from employment.

Category: Taxes

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