Self-employment tax in Washington
Washington State has no personal state income tax, so freelancers here owe only federal self-employment tax and federal income tax on their earnings. (Washington does have a separate capital gains tax on large investment gains, but not on your ordinary 1099 income.)
What a Washington freelancer owes
- No Washington state income tax on your freelance or 1099 earnings.
- Federal self-employment tax of 15.3% still applies.
- Plus federal income tax on your net profit.
Estimate your Washington taxes
Free 1099 self-employment tax calculator. No sign-up.
Washington has no state income tax, so this federal estimate is your full bill.
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 Washington — no income tax, but watch the B&O tax
Washington is famous among freelancers for having no state income tax — no state return on your self-employment profit and no state estimated payments. For income tax purposes, your only bill is federal. But Washington has a second tax that catches newcomers off guard, and it works completely differently: the Business & Occupation (B&O) tax.
First, the federal layer. You owe self-employment tax of 15.3% on 92.35% of your net profit, plus federal income tax after the half-SE-tax deduction and your other deductions. Pay quarterly to the IRS with Form 1040-ES (April, June, September, January). Everything about this layer is identical to the rest of the country.
Now the B&O tax. Instead of taxing profit, Washington taxes gross receipts — your total business income before expenses — at a rate that depends on your business classification. Service businesses, which include most freelancers and consultants, pay one of the higher common rates (around 1.5%–1.75% for many service activities in recent years); retailing and wholesaling pay far less. There are no deductions for labor, materials, or rent. Small businesses may qualify for a monthly B&O tax credit that wipes out small bills entirely, and very small service businesses can owe little or nothing after the credit — but you generally must still register with the Department of Revenue and file the excise tax return. Filing frequency is assigned based on your expected liability. Many Washington cities also impose their own local B&O tax or license fees on the same activity.
Worked example. A Seattle consultant bills $100,000 and nets $78,000 after expenses. Federal SE tax: $78,000 × 92.35% × 15.3% ≈ $11,019, plus federal income tax of roughly $7,500–$8,500 — say about $19,000 total, owed to the IRS. The B&O tax ignores the $78,000 profit figure entirely: it is calculated on the full $100,000 of gross receipts at her classification's rate (before any small business credit), and reported to the state on its own schedule.
The practical lesson: track gross income carefully, not just profit — Washington taxes one, the IRS taxes the other. MoneyFeed is a WhatsApp tool that works with your existing bookkeeping app: capture income and snap expense receipts in chat, and export CSV, Excel, or PDF records showing both sides of the ledger, ready for your federal estimates, your excise return, and the year-end packet you hand to your CPA.
FAQ
Washington has no income tax, so there is no state tax on your profit and no state estimated income payments. Your income-tax obligation is entirely federal.
The Business & Occupation tax is a Washington state tax on gross business receipts, charged at rates that vary by business classification. Most self-employed people doing business in Washington must register and file, though a small business credit eliminates the tax for the smallest operations.
Because it is based on gross income, not profit, and allows no deductions for costs. A business with thin margins can owe B&O tax in a year it made almost no profit.
Around 20–25% of profit covers the federal bill for many sole proprietors. Keep the B&O tax separate in your planning: it is a percentage of gross receipts, so calculate it from your billings, not your profit.
Many do. Cities such as Seattle and Tacoma run their own B&O taxes or business license fees on top of the state tax. Check your city's requirements when you register.
Washington freelancer tax — FAQ
Do freelancers pay state income tax in Washington?
No. Washington has no personal state income tax on earned or self-employed income. A state capital gains tax exists but applies only to certain large investment gains, not your 1099 earnings.
What taxes do I owe as a Washington freelancer?
Federal self-employment tax (15.3%) and federal income tax, typically paid as quarterly estimates.
How do I estimate my Washington 1099 taxes?
Use MoneyFeed's free 1099 calculator; with no state income tax, the federal figure is your total.
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.