Updated for 2026 tax brackets

How much of your side hustle do you keep?

Enter your main job and every side income stream. See exactly what you owe, how much your side hustle gets taxed on top of your day job, and what to set aside each quarter.

✓ W-2 + 1099 combined ✓ Self-employment tax ✓ Bracket stacking ✓ Quarterly estimates
Your main job (W-2 or 1099)
$
$
Side hustle income streams
Side hustle deductions optional — reduces your taxable income
$
$
$
$
$
$
Total annual take-home
$0
Per paycheck
$0
Total taxes
$0
Effective rate
0%
Hustle keep rate
—
Income stream
Gross
Taxes
Keep
How bracket stacking works: Side hustle income is taxed starting at your highest day-job bracket — not from zero. A $30K side hustle added to a $80K salary is taxed at 22–24%, not 10%. This tab shows exactly where your income stacks up.
⚠️ Quarterly taxes required: If your side hustle nets more than $400 after expenses, the IRS requires quarterly estimated payments. Missing deadlines triggers a penalty — even if you pay in full at tax time.
Home office
Deduct the % of your home used exclusively for business — either simplified ($5/sq ft, up to 300 sq ft) or actual expenses (rent, utilities, etc.).
Up to ~$1,500 simplified
Business mileage
Track every mile driven for your side hustle. The 2026 IRS standard mileage rate is 70¢ per mile. 1,000 miles = $700 deduction.
$0.70/mile in 2026
Equipment & supplies
Laptop, camera, tools, software, subscriptions — anything used for your business. Section 179 lets you deduct the full cost in year one.
Section 179: up to $1.16M
Self-employed health ins.
If you pay your own health, dental, or vision premiums and aren't eligible for employer coverage, 100% of premiums are deductible — above the line.
100% deductible
SEP-IRA / Solo 401(k)
Reduce both income tax and SE tax. Contribute up to 25% of net self-employment income. Solo 401(k) allows employee + employer contributions.
SEP-IRA: up to $69,000
SE tax deduction (auto)
You get to deduct half your self-employment tax as an income tax adjustment — this is already factored into your results above automatically.
50% of SE tax

Why side hustle income gets taxed harder

Three things make side income more expensive than regular W-2 wages.

01

Self-employment tax (15.3%)

W-2 employees pay 7.65% FICA and their employer matches it. With a side hustle, you pay both sides — the full 15.3% on net self-employment income. On $20K side income that's $3,060 before a dollar of income tax.

02

Bracket stacking

Your day job fills the lower brackets first. Side hustle income starts being taxed at your highest current rate — often 22–24% for a $60–80K salary. The first dollar of side income isn't at 10%.

03

No withholding

Nobody withholds taxes from your side income. You must estimate and pay quarterly. If you underpay by more than $1,000, you'll owe a penalty — regardless of how much you pay at tax time.

04

The silver lining: deductions

Employees can rarely deduct work expenses. Self-employed individuals can deduct equipment, mileage, home office, health insurance, and retirement contributions — often saving $3,000–$10,000+ per year.

Frequently asked questions

Yes. The $600 threshold only determines whether a client must send you a 1099-NEC. You are legally required to report all self-employment income regardless of amount — even if you earned $50 on a single gig and never received any tax form.
The self-employment (SE) tax rate is 15.3% on net self-employment income up to $184,500 (2026), and 2.9% above that threshold. This covers Social Security (12.4%) and Medicare (2.9%) — the same taxes a W-2 employee splits with their employer, but here you pay both halves. You can deduct half of SE tax as an income adjustment.
The 2026 quarterly estimated tax deadlines are: Q1 — April 15, 2026; Q2 — June 16, 2026; Q3 — September 15, 2026; Q4 — January 15, 2026. Pay via IRS Direct Pay or EFTPS. Missing a deadline doesn't mean you can skip it — pay as soon as possible to minimize penalty accrual.
The IRS allows deductions for expenses that are "ordinary and necessary" for your business. This includes equipment, software, supplies, professional services, business portions of phone and internet, business travel, and meals (50% deductible). Personal expenses mixed with business use must be apportioned. Keep receipts and records for everything.
Absolutely. Add as many income streams as you like in this calculator. Each 1099 income stream is subject to SE tax. Your combined net self-employment income is what SE tax is calculated on — all streams are aggregated, so deductions from one hustle can offset income from another.
It can. If your day job income puts you near the top of the 22% bracket ($47,150–$100,525 for single filers in 2026), side hustle income that crosses that line will push some income into 24%. Only the income above the threshold is taxed at the higher rate — not your entire income. The "Bracket stacking" tab shows this visually.