Side Income Tax Calculator: Side Hustle Taxes (2026)
Estimate how much of your side-hustle net profit you keep after tax. For self-employment, the statutory SE-tax rate is 15.3%, generally applied to 92.35% of net profit under the regular Schedule SE method. Enter net profit and a combined effective planning rate below to see after-tax income and a tax set-aside amount.
On this page: Calculator · Tax rates & set-aside guide · How it works · Deductions · FAQs
Side income tax calculator
Enter net side-business profit after deductible expenses and a combined effective tax rate to model tax owed and after-tax earnings.
Net side-hustle profit: $
Estimated tax: $
After-tax income: $
Effective tax rate: %
Need to file Schedule C income? FreeTaxUSA↗ supports self-employment filing; compare features for your situation before purchasing.
Side income tax rates and set-aside guide (2026)
Side-business profit can face both income tax and self-employment tax. Your existing wages may place additional profit into a higher federal bracket, but SE tax also depends on how much of the Social Security wage base has already been used by W-2 wages. The table below is a federal-only planning guide before QBI, credits, and state/local income tax.
How much to set aside by income bracket
| 2026 taxable income before added side profit | Marginal income tax rate | + SE tax (approx.) | Recommended set-aside |
|---|---|---|---|
| $0 – $12,400 | 10% | ~14.13% | ~23–25% |
| $12,401 – $50,400 | 12% | ~14.13% | ~25–27% |
| $50,401 – $105,700 | 22% | ~14.13% | ~34–36% |
| $105,701 – $201,775 | 24% | ~14.13% | ~36–38% |
| Above $201,775 | 32–37% | Varies | Model individually |
The ~14.13% figure is 92.35% × 15.3% and assumes the full Social Security portion still applies. It is not caused by the half-SE-tax income adjustment. If W-2 wages have already used some or all of the $184,500 Social Security wage base, the SE-tax portion can be lower; Additional Medicare Tax can apply at higher income. State/local tax may increase the set-aside.
After-tax side profit — common planning examples
| Net side-hustle profit | 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 business income outside a W-2 job—freelancing, consulting, app-based gig work, or selling products/services—start with business revenue minus ordinary and necessary business expenses. The resulting net profit can affect two federal tax calculations:
- 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) — the statutory rate is 15.3% (12.4% Social Security + 2.9% Medicare), generally applied to 92.35% of net profit under the regular method. W-2 wages share the same Social Security wage base, and half of calculated SE tax is generally an adjustment to income.
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
You may need estimated payments if you expect to owe at least $1,000 after withholding and refundable credits and you do not meet an applicable safe-harbor rule. If you also have a W-2 job, increasing payroll withholding can sometimes cover side-income tax instead. The regular 2026 calendar-year estimated-payment dates are:
| Quarter | Period covered | Payment due |
|---|---|---|
| Q1 | January 1 – March 31 | April 15, 2026 |
| Q2 | April 1 – May 31 | June 15, 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 — 72.5¢/mile for Jan.–June 2026 and 76¢/mile for July–December 2026 for qualifying business use
- 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 — generally deductible as an adjustment to income
Keep records throughout the year and separate business from personal use where required. For current vehicle rates see the IRS standard mileage rates; for estimated-payment rules see IRS Publication 505.
Filing taxes on side hustle income?
Many sole-proprietor side businesses report profit on Schedule C, and Schedule SE applies when net earnings meet the SE-tax threshold. Tax software can help prepare the forms and organize eligible deductions, but eligibility still depends on your facts.
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?
Taxable side income must generally be reported even if you do not receive a 1099 form. The $400 figure is not a general income-reporting threshold: it is the usual threshold at which net earnings from self-employment require Schedule SE and self-employment tax. Keep records of business revenue and deductible expenses regardless of whether a platform sends an information return.
Do you pay self-employment tax on side income?
Generally, yes when net earnings from self-employment are $400 or more. The statutory SE-tax rate is 15.3%, but under the regular method it is generally applied to 92.35% of net profit. W-2 wages and self-employment earnings share the 2026 $184,500 Social Security wage base, so a day job can reduce the Social Security portion still due on side profit. Medicare rules and federal/state income tax are separate.
How much tax should I set aside for side hustle income?
Base the set-aside on net profit, your marginal federal bracket, state/local tax, and how much Social Security wage base remains after any W-2 wages. When the full SE-tax rate applies, 92.35% × 15.3% is about 14.13% of profit before the half-SE-tax income adjustment. For someone already in the 22% federal bracket, a federal-only planning rate around the mid-30s can be reasonable before QBI or credits; use several scenarios rather than one universal percentage.
Can I deduct expenses from side income?
Ordinary and necessary business expenses generally reduce Schedule C net profit and can therefore reduce both income tax and SE tax. Examples can include qualifying home-office costs, business equipment/software, professional services, advertising, and business vehicle expenses. The 2026 business mileage rate is 72.5¢ per mile for January–June and 76¢ per mile for July–December. Deductibility depends on business purpose and substantiation.
Do I need to pay quarterly estimated taxes on side income?
You may need estimated payments if you expect to owe at least $1,000 after subtracting withholding and refundable credits and you do not meet a safe-harbor rule. For 2026 calendar-year taxpayers the regular due dates are April 15, June 15, September 15, 2026, and January 15, 2027. If you also have W-2 wages, increasing withholding can sometimes be used instead. Uneven income may also make the annualized-income installment method relevant.
Is this side income tax calculator accurate?
This calculator is a planning tool that applies one combined effective rate to the net side-business profit you enter. It does not calculate progressive brackets, Schedule SE, remaining Social Security wage base, QBI, credits, or state-specific tax. Use it to model set-aside scenarios; use tax software, IRS worksheets, or a tax professional for the return.