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Social Security Taxes on Self-Employment Income

Excerpted from "Social Security Handbook". See the up-to-date, official Social Security Handbook at

1415. Social Security Taxes on Self-Employment Income

1415.1 What are the tax rates on self-employment income?

Social Security taxes are paid on self-employment income up to the maximum amount creditable for the year. Medicare taxes are paid on all self-employment income, as there is no yearly maximum. (See §1201.) The Social Security and Medicare tax rates on self-employment income are shown in the following chart:

Social Security and Medicare Tax Rates (Self-Employment)

Taxable year

Retirement, survivors, and disability insurance rate

Hospital insurance rate

Combined rate













1990 and later




1415.2 What tax credits are allowed for self-employed persons?

If you were self-employed in 1984-1989, you were allowed credit against your Social Security and Medicare tax liability for those years in the following percentages:

Self-Employed Tax Credits

Taxable Year

Percentage Rate







After 1989, the credit was replaced with special deduction provisions designed to treat the self-employed like employees and employers are treated for Social Security and income tax purposes.

Last Revised: March, 2001


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