Estimate the self-employment tax owed on your LLC's net business income. Default LLC owners pay 15.3% SE tax on the first $168,600 (2026 Social Security wage base) and 2.9% Medicare above. The snapshot shows the full curve.
Net business income is revenue minus deductible business expenses. Use Schedule C line 31 for a single-member LLC or your bookkeeping software's net-income figure. This is the base the self-employment tax runs on, so it excludes W-2 wages, investment income, and anything already reported elsewhere. An accurate net figure is the whole game, because the tax is a fixed percentage applied to it up to the wage base.
The tool applies the projected 2026 Social Security wage base of $168,600. On the first $168,600 the rate is 15.3 percent, made up of 12.4 percent Social Security and 2.9 percent Medicare. Above the wage base only the 2.9 percent Medicare portion applies. An Additional Medicare Tax of 0.9 percent stacks on top above $200,000 for a single filer and $250,000 for married filing jointly.
The result shows total federal self-employment tax and the income left after it. The figure covers federal SE tax only and excludes federal and state income tax, which are separate bills. It also does not reflect the deduction for half of SE tax you claim on Form 1040. An S-corp election reduces this liability above a break-even income, which the LLC vs S-Corp calculator at /calculator/llc-vs-scorp/ quantifies.
Use the SE tax figure as the baseline for an S-corp comparison. Under the default LLC classification the full net income is subject to the 15.3 percent rate up to the wage base. Under an S-corp election only the reasonable-salary portion is payroll-taxed, and the distribution portion escapes SE tax. Once net income clears $40,000 to $60,000, that difference outweighs the payroll compliance cost and the election starts saving money.
| SE-tax base (profit × 0.9235) | $73,880 |
| Social Security 12.4% on first $168,600 | $9,161 |
| Medicare 2.9% on full base | $2,143 |
| Additional Medicare 0.9% over $200,000 single | $0 |
| Total SE tax owed | $11,304 |
| Deductible half (Form 1040 adjustment) | $5,652 |
seBase = profit × 0.9235 (the SE-tax adjustment)ssTax = min(seBase, $168,600) × 12.4%medicareTax = seBase × 2.9%addlMedicare = max(0, seBase − $200,000) × 0.9%SE tax = ssTax + medicareTax + addlMedicare
Uses the 2026 Social Security wage base of $168,600. Additional Medicare Tax of 0.9% applies above $200,000 single filer ($250,000 MFJ). Half of SE tax is deductible as an adjustment to income - that reduces federal income tax, not SE tax itself. State income tax not included.
Static snapshot pulled from current state filing fees, statutes, and pricing data. Updates when source data changes.
| Net business income | SE tax owed | Marginal rate | After-SE-tax net |
|---|---|---|---|
| $20,000 | $2,826 | 15.3% | $17,174 |
| $40,000 | $5,652 | 15.3% | $34,348 |
| $60,000 | $8,478 | 15.3% | $51,522 |
| $80,000 | $11,304 | 15.3% | $68,696 |
| $100,000 | $14,130 | 15.3% | $85,870 |
| $150,000 | $21,194 | 15.3% → 2.9% | $128,806 |
| $168,600 | $23,824 | SS wage base cap | $144,776 |
| $200,000 | $25,738 | 2.9% only | $174,262 |
| $300,000 | $28,638 | 2.9% + 0.9% surtax over $200k | $271,362 |
Calculations use the 2026 Social Security wage base ($168,600 projected). SE tax is 15.3% (12.4% SS + 2.9% Medicare) up to the wage base, then 2.9% Medicare only. Additional Medicare Tax of 0.9% applies above $200,000 single / $250,000 MFJ. State income tax not included. Does not account for the 50% deductible-half of SE tax on Form 1040.
Self-employment income is the net business income of an LLC taxed as a sole proprietorship (single-member default) or a partnership (multi-member default). It is the profit from actively running the business. It excludes W-2 wages, most rental income, interest, dividends, and capital gains, none of which carry self-employment tax. After an S-corp election, distributions fall out of the base entirely and only the reasonable-salary portion is wage-taxed. The distinction matters because two owners with identical total income can owe very different SE tax depending on how much of that income is active business profit versus investment or salary.
The self-employment tax rate is 15.3 percent on the first $168,600 of net earnings, the projected 2026 Social Security wage base, then 2.9 percent Medicare on earnings above it. The 15.3 percent splits into 12.4 percent for Social Security and 2.9 percent for Medicare. The Social Security portion stops at the wage base; the Medicare portion has no ceiling. A 0.9 percent Additional Medicare Tax applies above $200,000 for a single filer and $250,000 for married filing jointly. This tiered structure is why the marginal rate in the snapshot drops from 15.3 percent to 2.9 percent once income crosses the wage base.
Yes. You deduct half of your self-employment tax on Form 1040 as an adjustment to income. The deduction lowers income tax owed but does not lower the SE tax itself. The logic mirrors an employer's ability to deduct its share of payroll tax, since a self-employed owner pays both halves. The snapshot table does not fold in this deduction, so the real after-tax cost of SE tax is a little lower than the raw figures suggest once income tax is calculated. Treat the deduction as a separate income-tax benefit rather than a reduction in the SE tax line.
Above the $168,600 wage base, the 12.4 percent Social Security portion stops and only the 2.9 percent Medicare rate applies to additional net earnings. That is why the SE tax curve flattens sharply past the cap. A business earning $200,000 pays the full 15.3 percent on the first $168,600 and 2.9 percent on the remaining $31,400. Above $200,000 single or $250,000 married filing jointly, the 0.9 percent Additional Medicare Tax adds to the Medicare portion. The flattening above the cap is also why S-corp savings grow more slowly at very high incomes: most of the Social Security saving is already captured below the wage base.
An S-corp election reduces self-employment tax by splitting income into a reasonable salary, which carries payroll tax, and distributions, which escape self-employment tax entirely. Once net income exceeds $40,000 to $60,000 per year, the election pays off. Below that band, the roughly $1,500 annual payroll compliance cost outweighs the saving. Above it, the untaxed distribution portion produces net savings that grow with income. The salary must satisfy the IRS reasonableness test, so the distribution portion cannot be inflated without audit risk. The LLC vs S-Corp calculator at /calculator/llc-vs-scorp/ shows the break-even tables by income level.
No. Non-resident aliens are not subject to US Social Security or Medicare tax on US business income unless the income is effectively connected to a US trade or business and meets specific thresholds. Self-employment tax funds Social Security and Medicare, systems that non-resident aliens do not participate in for most US-source business income. A foreign founder invoicing clients through a US LLC with no US trade or business owes no SE tax. The analysis changes when the LLC has US employees or a US office, so a non-resident owner with US operations confirms the position with a US tax preparer.
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