---
title: "What is the self-employment tax rate and how is it calculated? Cite only eCFR (www.ecfr.gov) or U.S. Code sources, never irs.gov. Answer in under 100 words."
canonical: https://www.m-i-n-d.ai/minds/tax/self-employment-tax-rate-how-calculated
jurisdiction: "US Federal · Tax Year 2026"
last_verified: 2026-08-26
license: CC BY 4.0 — https://creativecommons.org/licenses/by/4.0/
attribution: "Source: MIND (m-i-n-d.ai)"
---

# What is the self-employment tax rate and how is it calculated? Cite only eCFR (www.ecfr.gov) or U.S. Code sources, never irs.gov. Answer in under 100 words.

For tax year 2026, the self-employment tax rate is 15.3%, composed of 12.4% for Old-Age, Survivors, and Disability Insurance (OASDI) and 2.9% for Medicare. An additional 0.9% Medicare surtax applies to self-employment income exceeding $200,000 ($250,000 joint). The tax is calculated by applying these rates to net earnings from self-employment, defined as gross income from a trade or business less deductions, plus a distributive share of partnership income.

## Details / How it works

Self-employment tax is imposed by **26 U.S.C. § 1401** and implemented by **26 CFR § 1.1401-1**. It combines Social Security (OASDI) and Medicare taxes for self-employed individuals. The tax is levied, assessed, and collected as part of the income tax under Subtitle A of the Internal Revenue Code.

**Net earnings from self-employment** are defined in **26 CFR § 1.1402(a)-1** as gross income derived from a trade or business, less allowable deductions under Chapter 1 of the Code, plus the distributive share (whether or not distributed) of partnership income or loss under section 704. Special rules in §§ 1.1402(a)-3 through 1.1402(a)-17 may apply.

The tax is computed on Schedule SE (Form 1040).

## Numbers & thresholds

| Component | Rate | Source |
|-----------|------|--------|
| OASDI (Social Security) | 12.4% | 26 U.S.C. § 1401(a); 26 CFR § 1.1401-1(b)(1) |
| Medicare (Hospital Insurance) | 2.9% | 26 U.S.C. § 1401(b)(1); 26 CFR § 1.1401-1(b)(2)(i) |
| **Combined rate** | **15.3%** |  |
| Additional Medicare Tax (surtax) | 0.9% on excess over $200,000 ($250,000 joint) | 26 U.S.C. § 1401(b)(2); 26 CFR § 1.1401-1(b)(2)(ii), (d) |

**Thresholds for Additional Medicare Tax (per 26 CFR § 1.1401-1(d)(1)):**
- Married filing jointly: $250,000
- Married filing separate: $125,000
- All other: $200,000

These thresholds are reduced by any wages taken into account for FICA Additional Medicare Tax (26 CFR § 1.1401-1(d)(2)).

## Exceptions & edge cases

**Partnership income:** A partner's distributive share of income from a partnership engaged in a trade or business is included in net earnings (26 CFR § 1.1402(a)-1(a)(2), referencing sections 704 and 702(a)(9)).

**Guaranteed payments:** Payments received from a partnership for services or capital (determined without regard to partnership income) are included in gross income (26 CFR § 1.1402(a)-1(b); see section 707(c)).

**Real estate exclusions:** Rentals from real estate and personal property leased with real estate are generally excluded unless received as a real estate dealer (26 U.S.C. § 1402(a)(1)).

**Agricultural arrangements:** Income from a land arrangement where the owner/tenant materially participates in production may be included in net earnings (26 U.S.C. § 1402(a)(1)).

**Disregarded entities:** A single-member LLC disregarded as separate from its owner is treated as a sole proprietorship; the owner is subject to self-employment tax on the LLC's activities (26 CFR § 301.7701-2(c)(2)(iv)(C)).

**Estimated tax:** Self-employment tax must be included in computing estimated tax under section 6015 (26 CFR § 1.1401-1(a)).

**Penalties:** Underpayment of estimated tax can result in an addition to tax under section 6654 (26 CFR § 1.6654-1).

## Sources

- [1] U.S. National Archives, Electronic Code of Federal Regulations — 26 CFR 1.1401-1 — Tax on self-employment income · https://www.ecfr.gov/current/title-26/section-1.1401-1 · as of 2026-08-26
- [2] Office of the Law Revision Counsel, U.S. House of Representatives — United States Code (prelim) — 26 U.S.C. § 1401 — Rate of Tax (Self-Employment) · https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1401&num=0&edition=prelim · as of 2026-08-26
- [3] U.S. National Archives, Electronic Code of Federal Regulations — 26 CFR 1.1402(a)-1 — Definition of net earnings from self-employment · https://www.ecfr.gov/current/title-26/section-1.1402(a)-1 · as of 2026-08-26
- [4] Office of the Law Revision Counsel, U.S. House of Representatives — United States Code (prelim) — 26 U.S.C. § 1402 — Definitions (Net Earnings from Self-Employment) · https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1402&num=0&edition=prelim · as of 2026-08-26