How much tax will I pay on side income?

Self-employment tax of about 14.1% of profit, plus income tax at your top rate. This playbook adds both up for your state.

Do I have to pay quarterly?

If you'll owe $1,000 or more at filing, the IRS expects quarterly payments, or extra W-4 withholding from your job.

Money Playbook · Updated 2026-10-02

Starting a $20k Side Hustle in Virginia: the money playbook

On $75k in Virginia, if you start a $20k side hustle your take-home pay rises by about $12,016 a year. 5-year simulator, scorecard, salary table and checklist.

Scenario simulator

Salary: $75,000Your monthly cost change: $0Years: 5

W-2 job only

$57,582

W-2 job + $20k profit

$69,598

Change per year

+$12,016

If the yearly difference is invested at 5%, after 5 years: $66,397

Includes self-employment tax (15.3% of 92.35% of profit, Social Security part capped) and income tax at your top rate. The 20% QBI deduction is left out, so your real result is likely a little better.

Decision scorecard

Tax impact (auto from simulator)5/5

Separate bank account for the business3/5Setting aside 25–30% for tax3/5Paying quarterly estimates3/5Tracking expenses and mileage3/5Side income doesn't break your job's rules3/5

Leaning yes — close the gaps first

Rate each factor honestly. The score is yours alone and isn't saved.

By salary level

Salary	W-2 job only	W-2 job + $20k profit	Difference
$40,000	$32,625	$46,500	$13,875
$60,000	$47,545	$59,908	$12,364
$75,000	$57,582	$69,598	$12,016
$100,000	$73,732	$85,744	$12,011
$150,000	$105,399	$117,044	$11,644
$200,000	$138,181	$151,181	$12,999

Printable checklist

Open a separate checking account for side income
Move 25–30% of every payment into a tax account
Pay quarterly estimates (April, June, September, January) or raise W-4 withholding
Track expenses and mileage from day one
Look at a Solo 401(k) or SEP-IRA to shelter profit
Keep every 1099 you receive

Questions

How much tax will I pay on side income?: Self-employment tax of about 14.1% of profit, plus income tax at your top rate. This playbook adds both up for your state.
Do I have to pay quarterly?: If you'll owe $1,000 or more at filing, the IRS expects quarterly payments, or extra W-4 withholding from your job.

Method and sources

Figures come from the same engine as our paycheck calculators: 2026 federal brackets and standard deduction, 2026 FICA, and 2025–2026 resident state schedules. City and county taxes, credits other than the Child Tax Credit, and nonresident rules are not modeled. Educational estimate, not tax advice.