How to Use This Calculator
- Enter Your Income Information
- Add Your State Information
- Review Your Tax Summary
- Important Notes
How Side Hustle Tax Calculator Works
This calculator helps you estimate your taxes for your side hustle.
Net Business Income = Side Hustle Income - Business Expenses
This is the amount that will be subject to self-employment tax and income tax.
Self-Employment Tax = Net Business Income × 15.3%
Self-employment tax consists of Social Security (12.4%) and Medicare (2.9%). You can deduct half of this amount from your income for income tax purposes.
AGI = Other Income + Net Business Income - Self-Employment Tax Deduction - Retirement Contributions
This is the amount used to determine your tax bracket.
Federal Tax = Σ(Taxable Income in Each Bracket × Bracket Rate)
Federal income tax is calculated using progressive tax brackets. Each portion of your income is taxed at the corresponding bracket rate. The 2024 tax brackets for single filers range from 10% to 37%.
State Tax = Adjusted Gross Income × State Tax Rate
State income tax is calculated by multiplying your AGI by your state's tax rate. Some states't have income tax, while others have progressive tax brackets similar to federal taxes.
Total Tax = Federal Tax + State Tax + Self-Employment Tax
This is the total amount you'll need to pay for the year.
Quarterly Payment = Total Tax ÷ 4
As a self-employed individual, you're required to make quarterly estimated tax payments. Each payment should be approximately one-fourth of your total tax obligation for the year.