Frequently Asked Questions
Got questions about your freelance taxes? We have answers.
How does a 1099 tax calculator work?
Our free 1099 tax calculator and self-employment tax estimator works by taking your total 1099 gross income, subtracting your independent contractor business write-offs, and calculating the 15.3% self-employment tax so you know exactly what to set aside for your freelance quarterly taxes.
What is a 1099 form?
A 1099 form is used to report non-employment income to the IRS. As a freelancer or independent contractor, clients who pay you $600 or more in a tax year will typically send you a Form 1099-NEC.
How much should I set aside for taxes?
A common rule of thumb is to set aside 25% to 30% of your net income for taxes. This covers both your estimated income tax and self-employment tax. You can use our calculator to get a more tailored estimate.
What qualifies as a business write-off?
The IRS states that a business expense must be both "ordinary" (common and accepted in your trade) and "necessary" (helpful and appropriate for your trade). Check out our Top Deductions guide for specific examples like home office and software expenses.
Do I have to pay taxes quarterly?
If you expect to owe $1,000 or more in taxes for the year (after subtracting withholding and refundable credits), the IRS generally requires you to make estimated quarterly tax payments to avoid penalties.
Is this calculator accurate for my specific state?
Our tool uses a generalized blended bracket rate for income tax estimates based on your selection. It is not state-specific to local county taxes and does not substitute for a professional tax assessment. Always consult a local CPA.
What is the QBI Deduction?
The Qualified Business Income (QBI) deduction allows eligible self-employed people to deduct up to 20% of their qualified business income from their taxes. This is automatically factored into our calculator estimates.