About the Side Hustle Income Calculator
This side hustle income calculator shows how much of your extra income you actually keep once taxes are paid. Enter your W-2 wages, what your side gig brings in and your business expenses, and it works out the extra federal income tax, the 15.3% self-employment tax, any Additional Medicare Tax and an estimate of state income tax — the tax on the side income alone, on top of what your job already costs you.
It uses 2026 federal rules: the inflation-adjusted brackets and standard deduction ($16,100 single, $32,200 married filing jointly, $24,150 head of household), self-employment tax on 92.35% of net profit with Social Security capped at the $184,500 wage base (reduced by your W-2 wages), the deduction for half of SE tax, and the 20% qualified business income (QBI) deduction for sole proprietors. Because side income stacks on top of your salary, it is taxed at your highest marginal rates.
It is for freelancers, gig drivers, resellers, creators and anyone with 1099 or cash income besides a day job who wants to know what to set aside for quarterly estimated taxes. It assumes the standard deduction, no other credits, and a flat state rate on side profit.
With the default inputs, the you keep (after all taxes) is $7,784.05. Change any value above to recalculate instantly.
How to use the side hustle income calculator
- 1Choose your filing status and enter your yearly W-2 wages.
- 2Enter what your side hustle earns and what it costs you in a year.
- 3Enter your state income tax rate (0 if your state has none).
- 4Read how much you keep and the percentage to set aside.
- 5Use the quarterly figure for estimated tax payments or extra W-4 withholding.
Formula and method
Net profit P is side income minus expenses. Self-employment tax is charged on 92.35% of P: 12.4% Social Security up to whatever room is left under the $184,500 wage base after your W-2 wages, plus 2.9% Medicare with no cap. The 0.9% Additional Medicare Tax applies to SE earnings above $200,000 ($250,000 joint) minus your wages. No SE tax is due if 92.35% of profit is under $400.
Federal income tax is calculated twice — with and without the side income — and the difference is the extra tax. With the side income, half of SE tax is deducted from AGI, the standard deduction applies, and the 20% QBI deduction is taken on profit minus half SE tax, limited to 20% of taxable income and phased out over $75,000 ($150,000 joint) above $201,750 ($403,500 joint) for a business with no employees, with a $400 minimum when QBI is at least $1,000. State tax is your rate × (profit − half SE tax).
- P
- Net side-hustle profit (income − expenses)
- W2
- Wages from your job (Social Security wages)
- SE tax
- Self-employment tax (Social Security + Medicare)
- QBI
- Qualified business income deduction (§199A)
Worked examples
$15,000 side gig on a $70,000 salary (single)
Profit of $12,000 carries $1,695.55 of SE tax. After deducting half of it and a $2,230 QBI deduction, federal income tax rises by $1,962.79 at your 22% bracket. With $557.61 of state tax, you keep $7,784 — about 65% of profit.
Married couple, $150,000 wages, $40,000 side income with $10,000 expenses, no state tax
SE tax on $30,000 of profit is $4,238.87. The extra income is taxed mostly at 22%, adding $4,906.98 of federal tax after the QBI deduction. The couple keeps $20,854, so they should set aside about 30%.
High earner over the Social Security wage base
Only $4,500 of wage base is left, so Social Security on the side income is $558 and Medicare $803. SE earnings above $20,000 trigger $69.35 of Additional Medicare Tax. Federal tax adds $5,629 at 24%, and you keep $21,767.
Frequently asked questions
How much should I set aside for taxes on a side hustle?+
Most people with a full-time job should set aside 25–35% of side-hustle profit: 15.3% self-employment tax (on 92.35% of profit) plus your top federal bracket, usually 12%–24%, plus state tax. This calculator gives your exact percentage.
Do I have to pay tax on side income if I don’t get a 1099?+
Yes. All income is taxable regardless of whether you get a 1099. The 1099 threshold is only a reporting rule for the businesses paying you, not a tax-free allowance. SE tax applies once net self-employment earnings reach $400.
Why is side hustle income taxed so heavily?+
Side income stacks on top of your wages, so it is taxed at your highest marginal rate, and you pay both halves of Social Security and Medicare (15.3%) as a self-employed person instead of the 7.65% an employee pays.
Do I need to make quarterly estimated tax payments?+
If you expect to owe $1,000 or more when you file, the IRS expects estimated payments by April 15, June 15, September 15 and January 15. Alternatively, increase withholding on your W-4 at your main job to cover the side-hustle tax.
What expenses can I deduct?+
Ordinary and necessary business costs: supplies, equipment, software, platform and payment fees, business mileage at the IRS standard mileage rate, a home office used exclusively for the business and a share of your phone and internet.
Does the QBI deduction apply to side hustles?+
Usually, yes. Sole proprietors can deduct up to 20% of qualified business income on Form 8995. Below $201,750 of taxable income ($403,500 joint) in 2026 there are no wage or service-business limits.
Tax results are estimates based on published rules and simplified assumptions. They are not tax advice — check official guidance or a tax professional for your situation.