Side Income Tax Calculator
Estimate how much of your side hustle income you keep after tax. Freelancers, gig workers, and consultants pay both income tax and self-employment tax (15.3%) on net profit — enter your gross earnings and combined rate below to see your after-tax income and how much to set aside.
On this page: Calculator · Tax rates & set-aside guide · How it works · Deductions · FAQs
Side income tax calculator
Enter your gross side income and estimated combined tax rate to see tax owed and after-tax earnings.
Gross side income: $
Estimated tax: $
After-tax income: $
Effective tax rate: %
Side income tax rates and set-aside guide (2026)
Side income from self-employment is taxed in two layers: self-employment tax (15.3%) on top of your ordinary income tax rate. Because your day job typically fills the lower tax brackets, new side income is often taxed at your top marginal rate.
How much to set aside by income bracket
| Day-job income (approx.) | Marginal income tax rate | + SE tax (approx.) | Recommended set-aside |
|---|---|---|---|
| Under $48,475 (single) | 12% | ~14% | ~25–28% |
| $48,476 – $103,350 | 22% | ~14% | ~30–33% |
| $103,351 – $197,300 | 24% | ~14% | ~33–35% |
| Over $197,300 | 32–37% | ~14% | ~40–45% |
SE tax shown as ~14% because you can deduct half (7.65%) from gross income, reducing the effective SE tax impact. State income tax will increase the set-aside further. Texas, Florida, and Washington have no state income tax.
After-tax side income — common examples
| Gross side income | Combined rate | Tax owed | After-tax income |
|---|---|---|---|
| $5,000 | 28% | $1,400 | $3,600 |
| $10,000 | 30% | $3,000 | $7,000 |
| $10,000 | 35% | $3,500 | $6,500 |
| $25,000 | 32% | $8,000 | $17,000 |
| $50,000 | 35% | $17,500 | $32,500 |
| $100,000 | 38% | $38,000 | $62,000 |
How side income taxes work
When you earn income outside of a W-2 job — freelancing, consulting, driving for a rideshare app, selling on Etsy, or any other self-employment activity — two taxes apply:
- Ordinary income tax — the same federal brackets that apply to wages. Because your salary already fills the lower brackets, new side income lands at or near your top marginal rate.
- Self-employment tax (SE tax) — 15.3% on net profit (12.4% Social Security + 2.9% Medicare). Employees only pay 7.65% because employers match the other half. As a self-employed person, you pay both sides. You can deduct half of SE tax from your gross income, which slightly reduces the effective rate.
Net profit — not gross revenue — is what's taxed. If you earn $20,000 in freelance income but have $4,000 in deductible expenses, you pay tax on $16,000.
Quarterly estimated taxes
If you expect to owe $1,000 or more in federal tax from side income for the year, the IRS requires quarterly estimated tax payments to avoid an underpayment penalty. Payments are due in April, June, September, and January. A simple approach: divide your estimated annual side income tax by 4 and pay each quarter.
| Quarter | Period covered | Payment due |
|---|---|---|
| Q1 | January 1 – March 31 | April 15, 2026 |
| Q2 | April 1 – May 31 | June 16, 2026 |
| Q3 | June 1 – August 31 | September 15, 2026 |
| Q4 | September 1 – December 31 | January 15, 2027 |
Side hustle deductions that reduce your tax bill
Ordinary and necessary business expenses are deductible from side income on Schedule C, reducing both taxable income and self-employment tax. Every dollar of deduction saves roughly $0.30–$0.40 in combined taxes for most side hustlers.
- Home office — dedicated workspace (exclusive and regular use required); simplified method is $5/sq ft up to 300 sq ft
- Equipment and software — laptop, phone, camera, subscriptions, tools used for the side hustle
- Mileage — $0.67/mile standard rate for business driving in 2026
- Professional services — accountant fees, legal fees related to the business
- Marketing and advertising — website hosting, ads, business cards
- Professional development — courses, books, and conferences directly related to your side hustle
- Half of self-employment tax — automatically deductible from gross income on Schedule SE
Keep receipts and records throughout the year. Business expenses paid with personal funds are still deductible — what matters is that the expense was for business, not personal, use.
Filing taxes on side hustle income?
Side income requires Schedule C (business profit/loss) and Schedule SE (self-employment tax). Tax software guides you through both and helps identify every deductible expense — often saving more than the cost of the software.
- TurboTax Self-Employed — finds industry-specific deductions for freelancers and gig workers; imports 1099-NEC and 1099-K
- H&R Block Self-Employed — file online or with a tax pro; good for side hustlers with complex deduction situations
- FreeTaxUSA — handles Schedule C and self-employment tax at low cost for straightforward side hustle returns
Affiliate links — we may earn a commission at no cost to you.
Related self-employment and tax calculators
- After-tax self-employed income calculator Estimate net income after income tax and self-employment tax for full-time freelancers
- Contractor vs employee calculator Compare net income from contracting vs a salaried role after all taxes
- After-tax hourly rate calculator Calculate your true net hourly rate after taxes for any project or gig
- Bonus & severance tax calculator Estimate tax on irregular income payments — similar tax treatment to large side income
- Self-employment tax calculators — all tools Full overview of freelance, contractor, and side income tax calculators
Side income tax: FAQs
Is side income taxable?
Yes. Side income from freelancing, gig work, consulting, selling goods, or any other self-employment activity is taxable and must be reported on your federal tax return. The IRS requires reporting all income over $400 from self-employment. Platforms like Uber, DoorDash, Etsy, and Upwork issue 1099-NEC or 1099-K forms, but you are required to report income regardless of whether you receive a form.
Do you pay self-employment tax on side income?
Yes, if your net side income is $400 or more. Self-employment tax is 15.3% — 12.4% for Social Security (on income up to $176,100 in 2026) plus 2.9% for Medicare. This is in addition to your regular federal and state income tax. Because your day-job employer already withholds income tax on your wages, side income is often taxed at your top marginal rate with the full SE tax on top — making the combined rate 30–40% for most earners.
How much tax should I set aside for side hustle income?
A common rule of thumb is to set aside 25%–35% of gross side income for taxes. The lower end applies if you have significant deductible expenses. The higher end applies if you are in the 22% or higher income tax bracket and have few deductions. A precise estimate: self-employment tax is roughly 14.1% after the deduction for half of SE tax, plus your marginal income tax rate (12%, 22%, or 24% for most side hustlers). On $10,000 in side income at the 22% bracket with no deductions, set aside about $3,500.
Can I deduct expenses from side income?
Yes. Ordinary and necessary business expenses are deductible from side income on Schedule C, reducing both taxable income and self-employment tax. Common deductions include: a dedicated home office, equipment and software, mileage driven for business ($0.67/mile in 2026), professional subscriptions and tools, and health insurance premiums. Deductions are dollar-for-dollar reductions in net profit — a $2,000 deduction saves roughly $600–$800 in combined taxes for most side hustlers.
Do I need to pay quarterly estimated taxes on side income?
Yes, if you expect to owe $1,000 or more in federal tax from side income for the year. The IRS requires quarterly estimated tax payments — due in April, June, September, and January — to avoid an underpayment penalty. A simple approach: divide your expected annual side income tax by 4 and pay each quarter. Use the calculator above to estimate your annual tax, then divide by 4 for your quarterly payment.
Is this side income tax calculator accurate?
This calculator provides an estimate by applying a flat tax rate to gross side income. Actual taxes may be lower if you have deductible business expenses, or higher if the additional income pushes you into a higher marginal bracket. Use it as a planning guide and set aside a buffer above the estimated amount. A tax professional or tax software can calculate your precise liability on Schedule C.