1099 Tax Calculator
Estimate federal taxes on US 1099 contractor income. Net profit is your 1099 income minus business expenses; the calculator estimates self-employment tax, income tax, and a suggested tax set-aside to help you plan.
Written by the CalcBundle Research & Editorial Team · Reviewed by the Quality Review Team · Transparent formulas · results are estimates, not advice. · Updated
Total estimated tax
Enter your 1099 income greater than your expenses.
What a 1099 tax calculator does
The freedom of contract work comes with a catch: no employer withholds your tax, so the money that hits your account is not yours to keep in full. A 1099 tax calculator estimates what you will actually owe — self-employment tax and income tax combined — and turns it into a simple set-aside percentage you can hold back from each payment. Used from the start of the year, it is the difference between a calm April and a bill that arrives without the cash to pay it.
From 1099 income to net profit
A 1099 reports gross payments, but tax is charged on net profit — your income minus deductible business expenses. This is the step that saves contractors the most money and the one they most often skip. Equipment, software subscriptions, professional services, business mileage and a reasonable home-office share all reduce profit, and every dollar of legitimate expense removes that dollar from both taxes. Enter income and expenses so the estimate reflects your real profit, not your gross receipts.
The two taxes a contractor owes
First comes self-employment tax — Social Security and Medicare at 15.3% on 92.35% of your profit, because a contractor pays both the employee and employer halves. Then comes income tax on the remainder, after the deductible half of the SE tax and your standard deduction, applied through the progressive brackets. Keeping these separate is why a contractor's effective rate is higher than a salaried worker's on the same profit — the extra employer-half of FICA is the difference. The self-employment tax calculator breaks the first piece down in detail.
Worked example
Say you invoice $80,000 on 1099s and have $15,000 of deductible expenses, leaving $65,000 of profit. Self-employment tax applies to 92.35% of that at 15.3%, and income tax applies to the profit after the deductible half of SE tax and the standard deduction. Add them and the total federal tax might land near a quarter to a third of profit — which is exactly why the calculator suggests holding back a similar share of every payment as it arrives.
Turning the estimate into a habit
Because nothing is withheld, the practical trick is to move the suggested set-aside into a separate account each time a client pays, then send it to the government in four instalments during the year using the quarterly tax calculator. Treat the set-aside as money that was never yours and the year-end reconciliation becomes routine. This calculator gives a planning estimate; your final liability depends on all your income, deductions and credits.
Frequently asked questions
How much should I set aside for 1099 taxes?
It depends on your profit, other income and filing status, but many contractors set aside roughly 25–35% of net profit. This calculator estimates your total federal tax (self-employment plus income tax) and suggests a set-aside percentage of net income — a planning estimate to keep you covered, not a required legal amount.
What is a 1099 and how is it different from a W-2?
A 1099 reports payments made to you as an independent contractor, with no tax withheld. A W-2 reports employee wages with income tax and the employee's half of FICA already withheld. As a 1099 worker you receive the full amount but are responsible for setting aside and paying the tax yourself — including both halves of Social Security and Medicare.
Is my entire 1099 payment taxable?
No — you are taxed on net profit, which is your 1099 income minus deductible business expenses. Diligently tracking expenses such as equipment, software, mileage and a home-office share lowers both your self-employment tax and your income tax, so good records directly reduce what you owe.
Do I have to pay taxes throughout the year?
Usually, yes. Because nothing is withheld, the US system expects independent workers to pay estimated tax in four instalments during the year rather than all at once in April. Underpaying can trigger penalties, which is why the suggested set-aside and the quarterly tax calculator matter.
What if 1099 work is only part of my income?
Enter your other income too. Self-employment tax applies to your contractor profit, but income tax is figured on your combined income, so a side gig on top of a salaried job can be taxed at a higher marginal rate than the gig alone would suggest. The calculator accounts for other income when estimating the income-tax portion.
Does this include state taxes?
No. It estimates US federal self-employment and income tax only. State and local income taxes vary widely and are not included — add your state's effect separately if it applies.
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Disclaimer. This calculator provides estimates for informational purposes only. Results are based on the information you enter and the assumptions used by the calculator. Actual financial, tax, business valuation, lending, marketplace or investment outcomes may differ. Consider consulting a qualified professional for decisions involving significant amounts of money. Estimates only, US federal. The suggested set-aside is a planning estimate, not a required legal amount, and this is not tax advice.