Freelance Tax Snapshot — Know Your Real Numbers
You earned $120,000 freelancing this year. You think you owe about $25,000 in taxes. The IRS says you owe $34,000.
The $9,000 gap has a name: self-employment tax. It is 15.3% of your net earnings — 12.4% Social Security plus 2.9% Medicare — and it sits ON TOP of your federal income tax. Most freelancers do not know it exists until their first April surprise.
On $120K of freelance income, SE tax alone is $14,412. That is more than the income tax in many brackets. And if you did not pay it quarterly, the IRS adds a 7% underpayment penalty compounded daily.
This agent makes sure you never get that surprise.
Five outputs. Not just a number.
Enter your income, expenses, filing status, and state. You get a complete financial action plan:
1. Quarterly Tax Breakdown
Three layers calculated separately — because understanding WHERE your money goes changes how you price your services:
| Layer | What it is | Rate |
|---|---|---|
| Self-Employment Tax | Social Security + Medicare | 15.3% on 92.35% of net |
| Federal Income Tax | Marginal brackets on adjusted income | 10% - 37% |
| State Income Tax | Varies by state | 0% - 13.3% |
Each layer shown with the exact dollar amount. No surprises.
2. Per-Invoice Set-Aside
The most actionable number you will get: exactly how much to transfer to your tax savings account every time a client pays.
Example: Your effective tax rate is 28.5%. Client pays $5,000 → immediately transfer $1,425 to your tax account. Do this on every payment and you will never face a quarterly scramble.
This is the four-account method recommended by financial advisors — automated with your exact numbers.
3. Effective Hourly Rate
The number that reveals whether your business model actually works.
Example:
- You charge $75/hour
- After taxes ($28,500), expenses ($12,000), and unpaid admin hours
- Your real take-home: $33.06/hour
That gap between $75 and $33 is where financial stress lives. Seeing it changes
