Self-Employment Tax by State 2026 — Full Ranking
See how much a freelancer keeps in every state: self-employment tax (15.3%) + federal income tax + state income tax, ranked from best to worst.
Net profit from Schedule C after business expenses. Same income is compared across all 51 jurisdictions.
Which states have no income tax for freelancers in 2026?
Nine states levy no individual income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington (on wage income) and Wyoming. Washington taxes capital gains only. At $100K net income a freelancer in any of these keeps about $74,255 — roughly $5,200 more than in California and $8,200 more than in Oregon.
What is the biggest state tax gap for freelancers?
The spread between the cheapest and most expensive states is about $8,200 a year at $100K of net income. Texas, Florida and Nevada sit at $0 state tax, while Oregon (top rate 9.9%) and Hawaii (top rate 11%) are the most expensive. Over a decade that gap is worth more than $80,000 — the single biggest lever a remote freelancer has on take-home pay.
Do I pay state income tax on top of self-employment tax?
Yes. Self-employment tax (15.3%) is federal and identical in every state; 42 states then tax your income on top. The state tax is calculated on your income after the federal standard deduction and the deductible half of SE tax, so the total effective rate ranges from 15.3% in no-tax states to over 30% in California and Oregon.
Which states changed their income tax for 2026?
Ohio flattened its tax to a single 2.75% rate on income above $26,050 (HB 96), Nebraska cut its top rate to 4.55%, Oklahoma collapsed six brackets into three (top 4.5%), Montana dropped to 5.65%, Kentucky to 3.5%, Mississippi to 4% and Indiana to 2.95%. Louisiana now has a flat 3% rate.
Are local taxes included in this ranking?
No — this ranking covers state income tax only. Local taxes can add on top: New York City residents pay an extra 3.1–3.9%, and Ohio municipalities levy their own income tax. Washington has a gross-receipts B&O tax that applies even in loss years, and New Hampshire taxes business profits above $109K. Always check local rules before relocating.
Disclaimer
Indicative estimate based on the rules in force on the verification date. This is not tax advice: always confirm with the tax authority, social security office or your accountant, because your own case may involve allowances, deductions or deadlines.
- Data verified on
- 21.10.2026
How to BECOME
Register with the social security authority for your country and apply for the reduced starter rate if you qualify. The contribution base can be changed 6 times a year.
How to become self-employedHow to become self-employed: step by step
Six steps with the real deadlines and the official links. Order matters: the registration date is what opens the window for the reduced rate and the VAT threshold.
Two questions decide your structure before you invoice anyone. First, IR35: if your client ends the contract and pays a substitute worker, the client checks your status. If your own limited company is between you and the client, that client is outside IR35 — but clients do check. Second, VAT: you must register if your turnover exceeds £90,000 in any 12 months (from 1 April 2025) — the registration threshold is not a tax allowance.
gov.uk — VAT registration threshold →
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