Mastering the 15.3% Self-Employment Tax
Transitioning to freelance work brings massive creative freedom, but it also makes you responsible for your own taxes. Unlike W-2 employees whose taxes are withheld from every paycheck, 1099 independent contractors must pay the 15.3% self-employment tax directly.
This tax consists of two primary components: 12.4% for Social Security and 2.9% for Medicare. It is calculated on your net business profits, not your gross billing.
The IRS Quarterly Estimated Tax Deadlines
To avoid IRS underpayment penalties, you must estimate your annual tax liability and make four quarterly payments throughout the year:
| Quarter | Income Period | IRS Payment Deadline |
|---|---|---|
| Q1 | January 1 - March 31 | April 15 |
| Q2 | April 1 - May 31 | June 15 |
| Q3 | June 1 - August 31 | September 15 |
| Q4 | September 1 - December 31 | January 15 (Following Year) |
Try the Live The Freelancer's Guide to 1099 Self-Employment Taxes & Quarterly IRS Payments
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