What rate matches your salary?
Going freelance? The honest floor is far higher than salary divided by 2,080. Self-employment tax, lost benefits, and billing fewer than 2,080 hours all push it up. Here's the real number.
In short
Updated for tax year 2026 · June 2026To match a salary as a freelancer, you have to bill far more than salary divided by 2,080. You pay both halves of FICA through self-employment tax, you cover the benefits an employer used to fund, and you bill far fewer than 2,080 hours a year. The real rate floor sits well above the naive number.
How is the freelance rate floor calculated?
This tool does the actual tax math: it applies self-employment tax to 92.35 percent of your net earnings, takes the deduction you are allowed for the employer half, and runs your real federal and state income tax brackets, then solves backward for the billings you would need so your take-home matches your old job. The result is a floor calculated from your actual situation, not a rule of thumb. Most rate calculators instead use a shortcut: take your salary, add 30 to 40 percent for taxes, multiply by some factor, which is fine for a rough sense but is a guess dressed up as a number. It also shows the qualified business income deduction (QBI) as a separate, lower figure if you qualify, because QBI is conditional, it phases out above an income threshold and does not apply to everyone, so the headline stays on the safe number that holds either way.
This is a floor, not your final rate
This tool calculates the rate at which freelancing breaks even with your old job, the line below which going independent actually makes you poorer. It accounts for self-employment tax, income tax, the benefits you lose (using the dollar value you enter), and realistic billable hours. It does not include your business expenses, software, equipment, insurance, an accountant, a co-working space, and it does not include any profit margin above simply replacing your salary. Those are real costs you must add on top. So treat the number as the bottom of your range, not the answer. Your actual rate should sit comfortably above it, with room for expenses, slow months, and growth. Pricing at the floor keeps you even with employment. Pricing above it is the whole point of working for yourself.
Two numbers to help you fill in the inputs
Two of the inputs are easy to underestimate, so here are rough benchmarks to anchor them.
Benefits are usually worth more than people guess. Employer-paid health insurance, retirement matching, and paid time off together tend to run about 25 to 40 percent of salary. So if you earned 80,000 dollars as an employee, the benefits you are giving up are often in the range of 20,000 to 30,000 dollars a year, not a token amount. Enter a realistic figure rather than a small one, because underestimating it is one of the quietest ways freelancers end up behind.
Billable hours are the other one. Full-time work is about 2,080 hours a year, but freelancers typically bill only 60 to 70 percent of that once you subtract finding clients, proposals, admin, and gaps. That is why the floor divides by a realistic billable number, not the full work year.
Common questions
How much should I charge as a freelancer to match my salary?
More than salary divided by 2,080. You owe self-employment tax, which is both halves of FICA, you replace your old benefits out of pocket, and you bill fewer hours than a full work year. The rate that matches your old take-home is the honest target.
Why is self-employment tax higher than payroll tax?
As an employee you pay one half of Social Security and Medicare and your employer pays the other. As a freelancer you pay both halves yourself, about 15.3 percent on net earnings, against roughly 7.65 percent as an employee.
Does the 20 percent QBI deduction lower my rate?
It can, if you qualify. We default the headline to the safe floor that assumes no QBI, then show the lower figure if you're eligible. Underpricing is the costlier mistake, so we lead with the higher number.
Built and reviewed by the EverydayBudd editorial team. Every figure on this page is reproduced in automated tests against published IRS data before it ships, and the tax figures use 2026 brackets and limits.