How much should I set aside for taxes? Free calculator for self-employed founders.
Sole prop, LLC, or S-Corp — enter your revenue, pick your structure, and get the exact dollar amount to move to a separate tax account every month.
This is an estimate. CaskFlow calculates your exact tax set-aside every month using your real transactions — and reminds you before a quarterly payment is due.
Get this calculated automatically every month → Try CaskFlow freeNo credit card. No bank login. Takes 3 minutes.
Why self-employed founders get blindsided by taxes
When you run your own business, nobody withholds taxes for you. Every dollar of net profit is exposed — income tax, self-employment tax, state tax — and the bill comes due four times a year as quarterly estimated payments. Most founders discover this the hard way, in April, when the account they thought was full is mostly spoken for.
The fix is mechanical: calculate your tax exposure on every dollar of revenue before you spend a single cent, and move that money immediately to a separate account. This calculator helps you find that number based on your business structure and effective rate.
Self-employment tax: the one founders always forget
If you're self-employed — sole proprietor, single-member LLC, or 1099 contractor — you pay self-employment (SE) tax of 15.3% on your net earnings. This covers Social Security (12.4%) and Medicare (2.9%) that would normally be split between you and an employer. When you work for yourself, you pay both halves.
On top of SE tax, you owe federal income tax on net profit. Add your state's income tax if applicable, and a typical solo LLC ends up in the 25–30% effective rate range on gross revenue. Higher earners or those in high-tax states can push toward 35%.
How business structure changes your set-aside
Sole Prop / 1099: Every dollar of net income is hit with SE tax. Simple to calculate, hardest to minimize. Default for freelancers and new founders.
Single-member LLC: Taxed identically to sole prop by default. The LLC provides liability separation, not tax savings. You still owe SE tax on all net profit.
S-Corp election: Once revenue is consistently above roughly $60k/year, an S-Corp election often makes sense. You pay yourself a "reasonable salary" — taxed via payroll including SE — and take additional profit as distributions, which avoid SE tax entirely. The savings can be $5,000–$15,000/year. Talk to a CPA about the threshold where it pencils out for your situation.
Quarterly estimated taxes: the schedule you need to know
The IRS expects self-employed founders to pay taxes four times a year:
- Q1 (Jan–Mar) due April 15
- Q2 (Apr–May) due June 15
- Q3 (Jun–Aug) due September 15
- Q4 (Sep–Dec) due January 15 of the following year
Miss a payment or underpay significantly, and you owe an underpayment penalty on top of the taxes owed. The safe harbor rule: pay at least 100% of last year's tax liability (or 110% if your prior-year AGI exceeded $150k) and you avoid the penalty even if your income grew.
When to consult a CPA
This calculator gives you a solid estimate. But tax is personal — state rates vary dramatically, deductions (home office, health insurance, retirement contributions) lower your effective rate, and S-Corp elections require payroll setup and annual filings. If you're clearing more than $60k in net profit, a one-time CPA consultation almost always pays for itself in the first year. Use this calculator to understand the order of magnitude, then get professional advice to optimize it.
The founders who stress least about taxes aren't the ones who earn less. They're the ones who treat the tax account as untouchable the moment revenue hits.
— Matthew, CaskFlow