Self-Employment Tax: As a 1099 worker, you pay both the employer and employee portions of Social Security (12.4%) and Medicare (2.9%) taxes, totaling 15.3% on 92.35% of net earnings.
Safe Harbor Rule: To avoid underpayment penalties, pay either 90% of your current year tax or 100%/110% of your prior year tax (110% if your AGI exceeds $150K) throughout the year via quarterly estimated payments.
Common Deductions: Home office, equipment, software, health insurance premiums (self-employed), SEP-IRA or Solo 401(k) contributions, professional development, and business travel.
QBI Deduction: The Section 199A Qualified Business Income deduction allows eligible self-employed individuals to deduct up to 20% of their qualified business income.
Disclaimer: This is an estimate only. State tax rates shown are approximate. Does not account for all deductions, credits, AMT, or complex situations. Consult a qualified tax professional.