What's different for US freelancers
If you work for yourself in the US, usually as a 1099 contractor or sole proprietor, a few things work differently from being an employee. Keep them in mind when you use our calculators.
You pay self-employment tax on top of income tax
Employers normally pay half of an employee's Social Security and Medicare taxes. When you're self-employed, you pay both halves yourself through self-employment tax. That's why your total tax rate is higher than you might expect, and why a freelance rate has to be well above an employee's hourly pay. See the IRS self-employment tax page.
Tax is paid every quarter, not once a year
No employer is withholding tax from your pay, so if you expect to owe tax you usually need to pay estimated tax during the year, using Form 1040-ES. Setting aside part of every payment you receive makes this much easier. See IRS estimated taxes.
Paid time off is on you
There are 11 federal holidays a year, and freelancers aren't paid for any of them, or for vacation and sick days. Count them as time off in our hourly rate and day rate calculators. Source: OPM federal holidays.
Late fees depend on your contract and your state
There's no single national rule for charging interest on late invoices. You can usually charge what your contract says, within your state's limits. Our late payment calculator works it out using your contract rate.
Tip: the IRS Self-Employed Individuals Tax Center is the best free starting point for US tax rules.