Self-employment tax in Ohio
Ohio taxes self-employed income in two layers: business income is taxed at 3% after a $250,000 business income deduction, and most Ohio freelancers also owe municipal income tax where they live or work - on top of federal self-employment and income tax.
What a Ohio freelancer owes
- Federal self-employment tax of 15.3% (12.4% Social Security + 2.9% Medicare).
- Ohio business income tax of 3% after the first $250,000 of business income is excluded (single or joint filers).
- Municipal income tax where you live or work, from 0.1% to 3% - Cleveland and Columbus are 2.5% - collected for many cities by RITA or CCA.
Estimate your Ohio taxes
Free 1099 self-employment tax calculator — add Ohio's 2.75% / 3% business state rate. No sign-up.
Enter Ohio's 2.75% / 3% business in the State Tax field for a full estimate.
States with no income tax are set to 0%. Estimate only — adjust for local taxes.
Estimates use 2026 US federal figures (IRS Rev. Proc. 2025-32): self-employment tax of 15.3% (12.4% Social Security up to the $184,500 wage base + 2.9% Medicare) plus federal income tax on your net profit after the standard deduction. State and local taxes are only included if you set a state rate above. Simplified estimate for planning only — not tax advice.
Guide: Self-employment tax in Ohio — business income, city tax, and the CAT
Ohio freelancers owe three layers of tax: federal self-employment tax, federal income tax, and Ohio tax — and Ohio itself has two systems. Business income is taxed at 3% after the business income deduction, which excludes the first $250,000 of business income (single or married filing jointly; $125,000 married filing separately). Nonbusiness income follows a separate 2026 schedule: up to $26,050 no tax, and over $26,050 you pay $332.00 plus 2.75% of the excess over $26,050.
The federal layer is the same in every state. Self-employment tax is 15.3% (12.4% Social Security + 2.9% Medicare) on 92.35% of your net profit, and it applies once your net earnings reach $400. The Social Security wage base is $184,500 for 2026; Medicare is uncapped. The deduction for half of your SE tax lowers your income tax only — it does not lower your net earnings or your SE tax.
Ohio has no standard deduction, and its personal exemption slides with income: $2,350 if modified AGI is $40,000 or less, $2,100 between $40,000 and $80,000, and $1,850 over $80,000, per taxpayer, spouse, and dependent (with a modified AGI cap of $750,000 for tax year 2025 and $500,000 for 2026 and later). Then there is the Commercial Activity Tax (CAT): a $6,000,000 exclusion applies for 2025 and later, so taxable gross receipts of $6,000,000 or less are not subject and need no filing, and receipts above the exclusion are taxed at 0.26%. In practice the CAT is nothing for nearly all freelancers. Finally, municipal income tax applies where you live and work, also on net business profit: 674 municipalities levied one in 2024, at rates from 0.1% to 3%, most commonly 1.0%, 1.5%, or 2% — Cleveland and Columbus charge 2.5% — and many are collected by RITA (about 400 cities and villages) or CCA.
Worked example. Take a freelancer with $60,000 of business income. The first $250,000 is excluded, so Ohio business income tax is $0. If that same $60,000 were nonbusiness income in 2026, the Ohio bill would be $332 + 2.75% of $33,950 = $1,265.63. Federal SE tax is $60,000 x 92.35% = $55,410, x 15.3% = $8,477.73. As an illustration, Columbus municipal tax at 2.5% on $60,000 would be $1,500 on top.
Ohio estimated payments for 2026 are due April 15, June 15, and September 15, 2026, and January 15, 2027, using the Ohio Universal Payment Coupon (OUPC) and 2026 Form IT-ES. Keep every receipt and invoice in MoneyFeed via WhatsApp, so your net profit — and the business-versus-nonbusiness split — is ready when each estimate comes due.
FAQ
Yes. The business income deduction excludes the first $250,000 of business income for single and joint filers ($125,000 married filing separately), and the remainder is taxed at 3%. That is why many Ohio freelancers owe no Ohio tax on their business income at all.
For 2026, nonbusiness income up to $26,050 is not taxed; over $26,050 you pay $332.00 plus 2.75% of the excess over $26,050. For comparison, the 2025 schedule was $342.00 plus 2.75% of the excess over $26,050 up to $100,000, and $2,394.32 plus 3.125% of the excess over $100,000.
In practice, no. The CAT applies to all entity types including sole proprietors, but a $6,000,000 exclusion applies for 2025 and later: taxable gross receipts of $6,000,000 or less are not subject and require no filing. Only receipts above the exclusion are taxed, at 0.26%.
Yes, in most places. Municipal income tax applies where you live and work, also on net business profit. In 2024, 674 municipalities levied one, at rates from 0.1% to 3%; the most common rates were 1.0% (268 municipalities), 1.5% (121), and 2% (123), while Cleveland and Columbus charge 2.5%. Many are collected by RITA (about 400 cities and villages) or CCA.
Use the calculator for the federal estimate, then handle Ohio separately: if your income is business income under the $250,000 exclusion, Ohio business tax is $0 — but remember to add your municipal rate. If your income is nonbusiness, use the 2026 schedule above.
Ohio freelancer tax — FAQ
Do freelancers pay state income tax in Ohio?
Yes, in two ways. Business income is taxed at 3% after the first $250,000 is excluded, and nonbusiness income over $26,050 in 2026 is taxed at $332.00 plus 2.75% of the excess. On top of that, most freelancers owe municipal income tax where they live or work.
What is Ohio CAT, and does it apply to freelancers?
The Commercial Activity Tax is a gross-receipts tax of 0.26% on receipts above a $6,000,000 exclusion for 2025 and later, so a freelancer with $6,000,000 or less in taxable gross receipts is not subject to it and does not file - in practice, no CAT for nearly all freelancers.
How do I estimate my Ohio 1099 taxes?
Use the free MoneyFeed 1099 calculator for the federal estimate, then add Ohio tax at 3% on business income above the $250,000 deduction and your municipal rate - for example, 2.5% in Cleveland or Columbus.
Figures are 2026 headline guidance for freelancers and the self-employed, not tax advice. Check current IRS and state rules or a CPA for your situation.