What Self-Employment Tax Actually Is
Self-employment tax is 15.3% of your net earnings — 12.4% for Social Security and 2.9% for Medicare. It's not a separate, extra tax on top of income tax; it's the self-employed version of what a W-2 employee and their employer split between them automatically.
Why You Pay Both Halves
A W-2 employee pays 7.65% and their employer matches it. As a 1099 worker, you're both the employee and the employer, so you pay the full 15.3% yourself — the single biggest tax-rate difference between 1099 and W-2 income.
It's Not 15.3% of Everything You Earn
Self-employment tax applies to roughly 92.35% of your net profit, not your gross income and not your full net profit. This adjustment exists because the employer-side half is technically deductible before the calculation runs.
You Get Half of It Back
The employer-equivalent half of your self-employment tax (7.65%) is deductible from your income tax — a real, automatic deduction that partially offsets what feels like double taxation, even though most gig workers never realize it's happening.
How SUNY Tracks This for You
SUNY calculates your running self-employment tax estimate as you log 1099 income, so your quarterly payment reflects the real 15.3% on 92.35% of net profit — not a rough guess.