SmartSalaryCalcs
Career & freelance

Freelance Rate Calculator

Calculate the hourly rate you need to hit your real income goal.

Last data update: May 26, 2026 · 2026 IRS self-employment tax rules; common freelancer billable-hours benchmarks

$

What you want to keep after taxes and expenses.

hrs

Not all 40 hours are billable — sales, admin, and learning eat real time. 20–30 is realistic for solo freelancers.

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$

Software, equipment, accounting, coworking, etc.

Federal + state + self-employment (~15.3%). Most solo freelancers land around 25–35% all-in.

Billable hours / year
Working weeks
Recommended hourly rate
per billable hour
Daily rate (8 hrs)
Weekly rate (full billable week)
Annual revenue needed
Where each revenue dollar goes
Take-home % Taxes % Expenses %

Quote rounded up — this is a floor, not a target. Premium clients and rush work earn more.

How to use this calculator

Start with your desired annual take-home — the number you want to actually keep in your bank account after taxes and business costs. Don't anchor on an old salary; anchor on the lifestyle you want to fund.

Set billable hours per week realistically. This is the time you can actually invoice for, not your total working hours. Solo freelancers typically lose 30–50% of their week to sales calls, proposals, admin, accounting, marketing, and learning — none of which clients pay for directly. Starting at 20–25 billable hours and adjusting as you measure your real ratio is sensible.

Pick vacation weeks honestly. You're the boss, so unpaid time off is real money out of pocket. Four weeks (US standard PTO equivalent) is a good baseline; add more if you take a long winter break or sick weeks.

Enter your annual business expenses — software subscriptions, hardware refreshes, accounting fees, coworking, professional development, and any pass-through costs. Then set the combined tax rate: federal income tax + state income tax + self-employment tax (~15.3%). For most US freelancers, 25–35% is realistic.

Calculation method

We work backwards from the take-home you want to the gross revenue your business must generate to deliver it:

  • Billable weeks = 52 − vacation weeks
  • Billable hours / year = billable hours per week × billable weeks
  • Gross revenue needed = (take-home + expenses) ÷ (1 − tax rate)
  • Hourly rate = gross revenue ÷ billable hours per year
  • Daily rate = hourly rate × 8
  • Weekly rate = hourly rate × billable hours per week

The "gross-up" by dividing by (1 − tax rate) is the part most freelancers miss. If you want $80,000 to keep at a 30% tax rate, you don't bill $80k + 30% × $80k = $104k — that still leaves you short. You need $80k ÷ 0.70 = $114,286 in pre-tax income to keep $80k, because taxes apply to the whole gross, including the part you're using to "pay" the tax.

Why freelancer tax rates run higher than W-2 employees': you owe self-employment tax on net earnings — 12.4% Social Security on the first $168,600 of net SE income (2024 wage base, indexes upward) plus 2.9% Medicare with no cap, totaling 15.3%. On top of that you pay regular federal and state income tax. W-2 workers only see half the FICA on their pay stub because their employer pays the other half; as a freelancer, you pay both halves.

The math says: pricing for your real cost of being in business is non-negotiable. Whatever rate you charge, the IRS, your state, your software vendors, and your own future bank account all take their cut first.

Examples

Junior freelancer, $60k target

$60,000 take-home target, 20 billable hrs/wk, 4 weeks off, $3,000 expenses, 25% tax rate.
Gross revenue needed: $84,000
Billable hours: 960/year
Hourly rate: $88/hr

Lower billable hours per week means a higher rate — you have fewer hours to spread fixed costs across.

Established freelancer, $100k target

$100,000 take-home target, 30 billable hrs/wk, 4 weeks off, $8,000 expenses, 30% tax rate.
Gross revenue needed: $154,286
Billable hours: 1,440/year
Hourly rate: $107/hr

Premium specialist, $150k target

$150,000 take-home target, 25 billable hrs/wk, 6 weeks off, $12,000 expenses, 35% tax rate.
Gross revenue needed: $249,231
Billable hours: 1,150/year
Hourly rate: $217/hr

Higher take-home goals with selective working hours pushes you firmly into specialist pricing territory.

Frequently Asked Questions

For solo freelancers, 20–30 billable hours per week is the honest range. The rest of your "working" time goes to client communication, proposals, invoicing, marketing, taxes, learning new skills, and the unpaid first hour of every project setup. Brand-new freelancers often hit 15 or fewer billable hours until their pipeline fills. Agency-employed contractors with steady backlog can reach 35+. If you assume 40 billable hours, you will underprice yourself.
Start at 30% as a working assumption for most US solo freelancers. That covers ~15.3% self-employment tax (Social Security + Medicare) plus roughly 12–18% effective federal income tax once standard deduction and QBI deduction apply, plus state income tax in most states. If you earn under ~$60k net or live in a no-income-tax state (TX, FL, WA, etc.), 25% is closer. If you clear $150k+ or live in a high-tax state (CA, NY, NJ), bump to 35%. Have your accountant verify with your actual return.
Yes, but where you put it matters. Either roll your annual ACA premium into "business expenses" (it's a legitimate self-employed health insurance deduction on Schedule 1), or include it in your take-home target so post-tax income covers it. Either way, don't forget it — freelance health coverage runs $500–$1,500/month per person without an employer subsidy, which is real money your hourly rate has to fund.
Because you're replacing the entire compensation package, not just the paycheck. A W-2 employee at $100k cash gets roughly $30–$50k more in employer-paid benefits: half the FICA tax, health insurance, retirement match, paid vacation, sick days, equipment, software licenses, and the management overhead of running a business. As a freelancer you pay all of that yourself — plus accept the income volatility. A 2x to 3x multiple on the equivalent W-2 hourly rate is normal and necessary, not greedy.
Use this hourly rate as your internal cost floor, then quote projects in fixed price for anything well-scoped. Clients prefer fixed price (no surprise bills), and you get paid for results not hours — meaning faster work earns more per hour, not less. To set a project price: estimate hours, add a 20–30% buffer for scope creep and revisions, multiply by this hourly rate, round up to a clean number. Keep hourly billing for true open-ended advisory work where scope is impossible to predict.

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