Understanding Self-Employment Taxes in 2026
Operating as a 1099 contractor means you are responsible for both the employer and employee portions of FICA taxes. This is commonly known as the Self-Employment Tax (SECA). For 2026, the total SE tax rate remains 15.3%, consisting of 12.4% for Social Security and 2.9% for Medicare.
[Image of self-employment tax breakdown 15.3% chart]Quarterly Estimated Tax Requirements
The IRS requires most 1099 earners to pay taxes in four quarterly installments. Failure to do so can result in underpayment penalties. Our calculator helps you estimate these payments so you can set aside the necessary funds from every invoice.
2026 Tax Deductions: Lower Your Bill
Remember that you only pay tax on your Net Profit. You can subtract business expenses such as home office costs, equipment, and marketing from your gross income before calculating the 1099 tax burden.
The Social Security Wage Base 2026
One critical update for 2026 is the adjusted Social Security wage base. You only pay the 12.4% Social Security portion on income up to the annual limit. Any income earned above this threshold is only subject to the 2.9% Medicare tax, significantly increasing the take-home pay for high-earning contractors.