Sources (checked 9 August 2026)
- Schedule SE + Pub 334: SE tax stack and 92.35% net-earnings adjustment. About Schedule SE
- IRS Rev. Proc. 2025-32: 2026 federal brackets and standard deductions ($16,100 single / $32,200 MFJ / $16,100 MFS / $24,150 HoH). IRS newsroom (Rev. Proc. 2025-32)
- Form 8995 instructions: QBI deduction = lesser of 20% of QBI or 20% of taxable income before the QBI deduction. irs.gov/instructions/i8995
- SSA COLA / CBB: 2026 Social Security wage base $184,500. ssa.gov/oact/cola/cbb.html
- State revenue department rate tables: flat top-marginal rates for 50 states + DC stored in production
STATE_TAX_RATES.
Calculation steps (production)
Supported filing statuses: single, married filing jointly, married filing separately, and head of household. Optional inputs include W-2 income, withholding, quarterly payments already made, QBI toggle, health insurance, retirement contributions, and business miles at the IRS standard mileage rate stored in constants ($0.725 for the current engine).
- Net SE income = gross 1099 income − business expenses − mileage deduction − health insurance − retirement contributions (floored at zero).
- Taxable SE earnings = net SE income × 0.9235.
- SE tax = Social Security (capped at $184,500 of taxable SE earnings × 12.4%) + Medicare (taxable SE earnings × 2.9%) + Additional Medicare (0.9% of max(0, taxable SE earnings + W-2 income − threshold)). This tool does not reduce the Social Security wage base for concurrent W-2 Social Security wages; use the SE Tax methodology tool when that coordination matters.
- AGI = net SE income − (SE tax × 50%) + W-2 income. The QBI deduction is not an AGI reduction.
- Taxable income before QBI = max(0, AGI − standard deduction for the filing status).
- QBI deduction (when enabled) = min(net SE income × 20%, taxable income before QBI × 20%). SSTB and Form 8995-A limitations are not modelled.
- Federal taxable income = taxable income before QBI − QBI deduction. Federal income tax uses 2026 MFJ brackets for MFJ; single, MFS, and HoH currently share the Single bracket table.
- State income tax = federal taxable income × flat state top-marginal rate (zero in no-tax states).
- Total tax = SE tax + federal income tax + state income tax. Quarterly / monthly planning figures divide total by 4 / 12. Amount due or refund subtracts federal/state withholding and quarterly amounts already paid when those fields are used.
2026 key constants
| Constant | Value in production |
|---|---|
| SS wage base | $184,500 |
| SS / Medicare / Additional Medicare rates | 12.4% / 2.9% / 0.9% |
| Net earnings adjustment | 92.35% |
| Standard deduction | $16,100 single & MFS; $32,200 MFJ; $24,150 HoH |
| QBI | Lesser of 20% of net SE income or 20% of pre-QBI taxable income |
| State tax base | Federal taxable income (after QBI) |
Reconciled worked example (Denver)
Published fixture: gross 1099 income $96,400, business expenses $13,250, filing status single, state Colorado (flat 4.4%), QBI on, no miles / W-2 / withholding. Rounded dollars match calculate1099Tax.test.ts:
| Line | Amount (rounded) |
|---|---|
| Net SE income | $83,150 |
| SE tax total | $11,749 |
| QBI deduction (taxable-income limit binds; not 20% × $83,150) | $12,235 |
| Federal taxable income | $48,941 |
| Federal income tax | $5,625 |
| State income tax (CO 4.4% × federal taxable) | $2,153 |
| Total tax / quarterly planning figure | $19,527 / $4,882 |
State-tax approximation
All 50 states and DC are available. The engine multiplies federal taxable income by a single stored rate (examples: CA 9.3%, NY 6.85%, IL 4.95%, CO 4.4%, TX/FL/WA and other no-income-tax states 0%). Progressive brackets, locality taxes, and state-specific conformity adjustments are out of scope. Moderate incomes in progressive states are often overestimated relative to a full state return. The Chicago SEO Vitest fixture (Illinois flat rate on federal taxable income) is a second regression check alongside the Denver example above.
Filing-status handling
Standard deductions and Additional Medicare thresholds follow the selected status. Federal bracket tables currently distinguish only MFJ versus everyone else (Single table). Qualifying surviving spouse is not a separate control on this tool; use MFJ brackets only when that status truly applies on a return, or run the dedicated SE Tax Calculator when you only need Schedule SE.
Limitations
- HoH and MFS use Single federal brackets (standard deductions remain status-correct).
- QBI SSTB / Form 8995-A phase-outs and wage limitations are not modelled.
- W-2 Social Security wages do not reduce the SE Social Security cap in this tool.
- AMT, most credits, itemized deductions, and multi-state allocation are unsupported.
Results are estimates for planning purposes only. Consult a licensed CPA or Enrolled Agent for your actual tax liability.
Testing, updates, responsibility, corrections
Denver and Chicago fixtures pin QBI, federal tax, state tax, and totals to the dollar. Constants refresh with Rev. Proc. / SSA autumn releases. Publishing responsibility: FreelanceMath (organizational voice, no invented credentials). Corrections: freelancemath.mail@gmail.com.
Version log
- 2026-08-09: Corrected Rev. Proc. citation to 2025-32; rewrote QBI as Form 8995 taxable-income limitation (removed incorrect AGI subtraction); aligned state-tax base and HoH/MFS bracket notes with code; added Denver reconciled example and version log.
- 2026-05-18: Initial 1099 methodology page.