Self-Employment Tax

You pay both employee (7.65%) and employer (7.65%) portions = 15.3%. W-2 workers split with employer; you pay all. SE tax deduction offsets some (0.5 × SE tax).

Yes. Calculate: Gross income − Business deductions = Net income. Apply SE tax to net. Deductible expenses reduce both income tax and SE tax.

Additional 0.9% Medicare tax on earnings > $200k (single) or $250k (married). Plus 3.8% Net Investment Income Tax on unearned income. Cumulative rates hit high earners hard.