How the estimate is worked out
Start with your expected net profit: what your business takes in for the year minus its expenses, the figure that ends up on Schedule C. Self-employment tax is charged on 92.35% of that profit, at 12.4% for Social Security up to the $184,500 wage base and 2.9% for Medicare on all of it. If you also have a W-2 job, your wages use up the Social Security wage base first. Once profit and wages together pass $200,000 ($250,000 married filing jointly, $125,000 separately), a further 0.9% Additional Medicare Tax applies.
For income tax, the calculator adds your profit and wages, subtracts half of the self-employment tax, then takes off the 2026 standard deduction: $16,100 single or married filing separately, $32,200 married filing jointly and $24,150 head of household. The rest is taxed through the 2026 brackets, from 10% to 37%.
The QBI deduction, simplified
Most sole proprietors can deduct up to 20% of their qualified business income. Tick the box and the calculator takes 20% of your profit less half your self-employment tax, capped at 20% of taxable income. Above $201,750 of taxable income ($403,500 jointly), limits based on the wages your business pays and on specified service businesses (such as consulting, law and health) start to apply; those are not modelled, so the page warns you when they may apply.
Paying in four instalments
Your total tax minus any withholding is what you still owe. Split it into four and pay by April 15, 2026, June 15, 2026, September 15, 2026, January 15, 2027. To avoid the underpayment penalty you only need to reach the safe harbor: the smaller of 90% of this year's tax or 100% of last year's (110% if last year's AGI was over $150,000, or $75,000 married filing separately). If you owe less than $1,000 after withholding, no estimated payments are required. Paying the safe-harbor amount avoids the penalty, but you will still owe the difference when you file.
What this leaves out
This is a federal estimate only. State income tax is out of scope, as are tax credits such as the child tax credit, investment and other income, itemized deductions, the alternative minimum tax and the net investment income tax. If your income is uneven through the year, the annualized method on Form 2210 may let you pay less early on. Check the result against your own return or an accountant before relying on it.
Sources
Figures for tax year 2026, checked October 31, 2026: