Side Hustle Income Calculator
Find out what your side hustle really pays after expenses and taxes — your true monthly profit and your real hourly rate.
Calculate Your Real Side Hustle Income
Supplies, software, gas, platform fees, phone — anything the hustle costs you each month.
25–30% is the usual set-aside for 1099 income: it covers income tax plus the 15.3% self-employment tax.
| Breakdown | Amount |
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Your tax set-aside is money you should move to a separate savings account the day you get paid — not money you can spend. If your side hustle earns enough to owe tax, you will generally need to pay it in four quarterly installments. Work out each payment with our Quarterly Estimated Tax Calculator.
How the Side Hustle Math Works
Your quoted hourly rate is not what you keep. Three things eat into it: the hours you actually bill, the expenses of doing the work, and taxes. This calculator strips each layer away in order, so the final number is the money that is genuinely yours.
- Monthly gross: hours per week × hourly rate × 4.33 (the average number of weeks in a month — 52 weeks divided by 12 months).
- Net before tax: monthly gross minus your monthly business expenses.
- Tax set-aside: net before tax × your set-aside percentage. The set-aside is not your exact tax bill; it is a safety cushion you hold back so tax time never hurts.
- True hourly rate: monthly net after tax divided by your total monthly hours. This is the number to compare against your day job or against raising your rates.
Net before tax = monthly gross − monthly expenses
Tax set-aside = net before tax × tax set-aside %
Monthly net = net before tax − tax set-aside
Annual net = monthly net × 12
True hourly rate = monthly net ÷ (hours per week × 4.33)
The 25–30% Tax Set-Aside Rule
If you earn 1099 income — freelance work, gig apps, Etsy sales, tutoring, delivery driving — nobody withholds tax for you. The widely used rule is to set aside 25–30% of every payment you receive. That range covers two separate taxes: your ordinary income tax (which depends on your total income and filing status) and self-employment tax. If your side hustle is your only income and your total profit is modest, 25% is usually enough. If you also have a well-paid day job that pushes you into a higher bracket, lean toward 30%.
Self-Employment Tax: 15.3% on Net Earnings of $400 or More
Self-employment tax is the part that surprises new side hustlers. It is 15.3% — 12.4% for Social Security plus 2.9% for Medicare — and it applies on top of your income tax. The IRS applies it to 92.35% of your net profit (your profit after expenses), and you owe it once your net earnings from self-employment reach $400 in a year. The Social Security portion only applies up to the 2026 wage base of $184,500 of combined wages and net earnings; the Medicare portion has no cap. You also get to deduct half of your self-employment tax as an adjustment on your return. Figures per IRS Topic No. 554 and the IRS self-employment tax page.
Driving Gigs: The 2026 Mileage Deduction
If your side hustle involves driving — delivery, rideshare, courier work — mileage is usually your biggest deduction. The IRS standard mileage rate for 2026 is split: 72.5 cents per business mile for miles driven January 1 through June 30, 2026, and 76 cents per business mile for miles driven July 1 through December 31, 2026 (IRS Notice 2026-10 and Announcement 2026-11). Keep a log with the date, purpose, and miles of every business trip; commuting from home to a regular workplace does not count. You can use the standard rate or track actual vehicle costs, but not both in the same year for the same car. Count your mileage deduction as a monthly expense in the calculator above.
Worked Example: 10 Hours a Week at $25 an Hour
| Calculation | Monthly | |
|---|---|---|
| Monthly gross | 10 hrs × $25 × 4.33 | $1,082.50 |
| Monthly expenses | Supplies and platform fees | −$150.00 |
| Net before tax | $1,082.50 − $150.00 | $932.50 |
| Tax set-aside (25%) | 25% × $932.50 | −$233.13 |
| Monthly net after tax | $699.38 | |
| Annual net after tax | $699.38 × 12 | $8,392.50 |
| True hourly rate | $699.38 ÷ 43.3 hours | $16.15 |
Notice the gap: the quoted rate is $25 an hour, but after $150 of monthly expenses and a 25% tax set-aside, the real pay is $16.15 an hour. That is still solid extra income — about $700 a month — but it is the number to use when deciding whether the hustle is worth your evenings.
Ways to Raise Your Real Hourly Rate
- Raise your rate first: a $5 increase at 10 hours a week adds about $162 a month after a 25% set-aside.
- Cut low-value expenses: audit subscriptions and supplies every quarter; every $10 saved is $7.50 kept after tax.
- Track every deduction: mileage, phone, home-office share, and software all reduce net profit — and therefore both taxes.
- Batch your hours: fewer, longer sessions cut unpaid setup and travel time, which lifts your true hourly rate without raising prices.
