Why it exists
Employees and employers share payroll taxes. A self-employed person generally accounts for both sides through the self-employment tax rules.
Freelancer tax guide
What Is Self-Employment Tax?
Learn what self-employment tax pays for, who generally owes it, and how Schedule C profit connects to Schedule SE.
Self-employment tax is primarily the Social Security and Medicare tax for people who work for themselves. It is separate from regular income tax and is calculated on Schedule SE.
Where the calculation starts
For many freelancers, the starting point is Schedule C net profit. Other self-employment activities can also feed Schedule SE, while some kinds of income are excluded or follow special rules.
How it reaches your return
Schedule SE calculates the tax, and part of the amount is generally allowed as an adjustment to income. The tax itself remains due even though the adjustment can reduce income subject to regular income tax.
Questions & answers
Who usually pays self-employment tax?
People with net earnings from self-employment generally use Schedule SE when they meet the filing threshold or another special rule applies.
Does an LLC avoid self-employment tax?
An LLC is a legal entity classification, not automatically a federal tax classification. A single-member LLC taxed as a sole proprietorship commonly follows the same Schedule C and Schedule SE rules.
Official sources
Educational information only. Tax rules and filing details change; verify the filing-year instructions or work with a qualified tax professional.
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