How much should I set aside for taxes as a freelancer?

Most freelancers should save somewhere between 20% and 35% of every payment. The right number for you depends on your profit, your filing status, whether you also have a day job, and your state. Here's how to find yours.

Why freelancers owe more than they expect

When you're an employee, your employer pays half of your Social Security and Medicare taxes and withholds income tax from every paycheck. As a freelancer you pay both halves yourself, called self-employment tax, which is 15.3% on most of your profit, before income tax.

In 2026 the Social Security part (12.4%) applies up to a $184,500 wage base; the Medicare part (2.9%) has no cap.

A quick rule of thumb

Profit under $50,000, no other job, low-tax state: save about 20–25%.
Profit $50,000–$150,000, or a day job on top: save about 25–30%.
High-tax state (CA, NY, NJ, OR) or profit above $150,000: save 30–35%.

Get your exact percentage

Rules of thumb over-save or under-save. Our free quarterly tax calculator uses the 2026 brackets, the self-employment tax rules and the qualified business income deduction to give you one number to save from every payment.

Make it automatic

Open a separate savings account just for taxes. Each time a client pays you, move your set-aside percentage there before you spend anything. The Quarterbird app shows the exact amount for every payment it imports from Venmo, Cash App, PayPal, Stripe, Square or your bank.

Know your number for every payment.

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Frequently asked questions

Is 30% enough to set aside for 1099 taxes?

For most freelancers, yes. 30% is often a little more than needed. If your profit is under about $50,000 and your state has low or no income tax, you may only need 20–25%.

Do I set aside money from gross income or profit?

From profit, meaning income minus business expenses. If you track write-offs, you can save a smaller share of each payment. If you don't, apply the percentage to everything you receive to stay safe.

What if I also have a W-2 job?

Your freelance income stacks on top of your salary, so it's taxed at your highest bracket. Your set-aside percentage usually goes up. The calculator accounts for this if you enter your wages and withholding.

Estimates and general information, not tax advice. Check with a tax professional for your situation.