1099 Expense Tracking: A Guide for US Freelancers
In short: US freelancers paid on a 1099 deduct business expenses that are ordinary and necessary for their work on Schedule C, which lowers both income tax and self-employment tax. Keep a receipt or written record for every deduction, a mileage log for vehicle costs and your home office measurements for at least six years, and set aside 25-30% of every payment for taxes.
Read MoreSelf-Employment Tax Explained: The 15.3% Nobody Warns You About
In short: US self-employment tax is 15.3% (12.4% Social Security up to the $184,500 wage base for 2026, plus 2.9% Medicare with no cap), applied to 92.35% of your net self-employment earnings. On $50,000 of net income that comes to about $7,065, on top of income tax. It applies once net earnings reach $400, and half of it is deductible when calculating adjusted gross income.
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