When you are self-employed, the number on your client invoice is not the number that lands in your bank account. Unlike a W-2 employee, a freelancer, contractor, or small-agency owner pays both the employer and employee side of Social Security and Medicare, sets aside money for taxes every quarter, and still has to cover software, travel, and a home office out of the same gross billings. This freelance income calculator turns your hourly rate, billable hours, and working weeks into a realistic annual gross, a self-employment tax estimate, and your true net take-home pay — so you can quote clients and plan your budget from real numbers instead of guesses.
Adjust any field and every figure below updates instantly.
How to Use
- Enter your Hourly Rate — what you actually charge clients per billable hour. This is not your target salary; it is the rate on your invoice.
- Set Billable Hours per Week. Be honest: most freelancers bill only half to two-thirds of the hours they sit at a desk, because pitching, invoicing, and admin do not count.
- Choose Weeks Worked per Year. Start from 52 and subtract vacation, sick days, holidays, and slow periods. Forty-eight weeks is a realistic full-time freelance baseline.
- Add Annual Business Expenses if you have them — software subscriptions, coworking space, mileage, equipment, and other deductible costs. They lower your taxable profit.
- Leave the Self-Employment Tax Rate at the default 15.3% for US freelancers (12.4% Social Security + 2.9% Medicare). Change it only if you know your effective rate.
The result card then shows your annual gross income, net profit after expenses, the estimated self-employment tax, your annual and monthly net take-home, and the effective tax rate on your earnings.
How Freelance Income Is Taxed
W-2 employees split FICA with their employer: 7.65% comes out of their paycheck and 7.65% is paid by the company. The self-employed pay the full 15.3% on their net earnings through Schedule SE. That is the single biggest surprise for new freelancers — a $100,000 billing year does not mean $100,000 of spendable money.
There is some relief. You deduct ordinary business expenses before calculating profit, and you can deduct half of the self-employment tax itself on your income tax return. This calculator focuses on the self-employment tax layer, which is the one freelancers most often forget to budget for. Federal and state income tax sit on top of that, so set aside an additional 15–25% of your net profit for quarterly estimated payments.
Examples
Example 1 — The default baseline. At $100 per hour, 20 billable hours a week, and 48 weeks a year, annual gross is $96,000. With no expenses and the standard 15.3% rate, self-employment tax is about $14,688, leaving an annual net take-home of $81,312 — roughly $6,776 per month.
Example 2 — A designer with real expenses. The same $96,000 gross, but $12,000 goes to software, a coworking membership, and mileage. Net profit drops to $84,000, the self-employment tax falls to $12,852, and net take-home is $71,148 (about $5,929/month). Tracking your deductions directly grows your bottom line.
Example 3 — Scaling hours. Push to 40 billable hours a week at $100 for 48 weeks and gross doubles to $192,000. At 15.3%, the self-employment tax is nearly $29,376, and net take-home is about $162,624 a year — which is why raising your billed hours or rate is the fastest lever for freelance income.
FAQ
How much can a freelancer really take home?
Take-home pay is your gross billings minus business expenses minus self-employment tax (15.3% on net profit), and then minus federal and state income tax. As a rough rule, budget to keep about 60–75% of your gross billings after all taxes. Use this calculator to see your own number by entering your rate, hours, and expenses.
What is the self-employment tax rate?
For US freelancers, the standard self-employment tax is 15.3% of net earnings: 12.4% for Social Security on wages up to an annual base and 2.9% for Medicare with no cap. It covers both the employer and employee portions that a W-2 worker splits with their company.
Is the self-employment tax on gross or net income?
It is on your net profit — gross income minus allowable business expenses. That is why tracking deductions matters: every deductible dollar reduces both your income tax and your self-employment tax.
How many billable hours should I expect per week?
Most full-time freelancers bill 20–30 hours per week, not 40. The remaining time goes to sales calls, proposals, invoicing, accounting, and continuing education. Entering a realistic number prevents you from overestimating your annual income.
Do I have to pay quarterly estimated taxes?
If you expect to owe $1,000 or more in tax for the year, the IRS generally requires quarterly estimated payments on the 15th of April, June, September, and January. Underpaying triggers penalties, so set aside a percentage of every invoice rather than waiting for tax day.
What expenses can a freelancer deduct?
Common deductions include home office costs, software and subscriptions, coworking or office rent, business travel and mileage, equipment, professional insurance, education, and contract labor. Keep receipts and separate business and personal bank accounts to defend your deductions in an audit.
Disclaimer
This freelance income calculator is provided for informational purposes only and does not constitute tax, legal, or financial advice. Estimates use simplified assumptions (a flat 15.3% self-employment rate and your entered inputs) and do not include federal or state income tax, the Social Security wage-base cap, the half-SE deduction, or local rules. Actual tax owed varies by your filing status, location, and situation. Consult a qualified tax professional before making financial or tax decisions.