New York 1099 taxes: a 2026 guide for the self-employed
Keeper StaffKeeper is a delightfully smart tax filing software that's especially useful for people with 1099 contracting and freelance income. Our blog breaks down IRS guidance with real-world examples and analysis by tax professionals — empowering taxpayers to save money and take control of their finances.
Krislyn ChanKrislyn is Chief Growth Officer at Keeper. At Keeper, she strives to make expert-level tax strategies that used to require a traditional CPA accessible to all. Prior to Keeper, she was at Curology, where she helped bring custom, prescription-grade skincare out of the dermatologist's office to millions of faces.
Key takeaways
- 1099 income in New York is subject to three taxes: 15.3% federal self-employment tax, 10% to 37% federal income tax, and 3.9% to 10.9% New York State income tax. New York City residents also pay 3.078% to 3.876% city income tax.
- Set aside 25–30% of your profit in a high-yield savings account, or closer to 30% in New York City. For a single filer, total tax runs from 22.1% at $40,000 to 32.0% at $200,000, or 24.3% to 35.7% for an NYC resident.
- New York doesn’t allow the federal QBI deduction. You can still deduct half of your self-employment tax, and New York gives you an $8,000 standard deduction ($16,050 married filing jointly).
- Pay quarterly estimated taxes if you expect to owe $300 or more in New York State tax, or $300 or more in NYC tax. City tax goes on the same Form IT-2105 payments. Get your amounts with the New York quarterly tax calculator.
- Higher-earning self-employed people in NYC can owe two more taxes: NYC’s 4% business tax (UBT), which a credit wipes out for most people under about $100,000 of profit, and a 0.6% transit tax once self-employment earnings top $150,000.
How much tax do 1099 workers pay in New York?
These tables show estimated 2026 tax on self-employment profit, the amount left after business expenses. They assume this is your only income, you take the standard deduction, and you have no kids or tax credits.
Single filer, 2026
| 1099 profit | Total tax | % of profit | Self-employment tax | Federal income tax | New York income tax |
|---|---|---|---|---|---|
| $40,000 | $8,837 | 22.1% | $5,652 | $1,775 | $1,410 |
| $60,000 | $14,451 | 24.1% | $8,478 | $3,559 | $2,414 |
| $80,000 | $20,065 | 25.1% | $11,304 | $5,344 | $3,418 |
| $100,000 | $26,807 | 26.8% | $14,130 | $8,235 | $4,443 |
| $150,000 | $45,153 | 30.1% | $21,194 | $16,413 | $7,545 |
| $200,000 | $63,926 | 32.0% | $28,234 | $25,196 | $10,495 |
Married filing jointly, one self-employed spouse, 2026
| 1099 profit | Total tax | % of profit | Self-employment tax | Federal income tax | New York income tax |
|---|---|---|---|---|---|
| $40,000 | $6,893 | 17.2% | $5,652 | $398 | $844 |
| $60,000 | $12,175 | 20.3% | $8,478 | $1,885 | $1,812 |
| $80,000 | $17,669 | 22.1% | $11,304 | $3,550 | $2,816 |
| $100,000 | $23,283 | 23.3% | $14,130 | $5,335 | $3,819 |
| $150,000 | $37,530 | 25.0% | $21,194 | $9,795 | $6,540 |
| $200,000 | $54,312 | 27.2% | $28,234 | $16,472 | $9,606 |
How New York taxes 1099 income
If you’re a freelancer, independent contractor, gig worker, or solo business owner in New York, your net profit (1099 income minus business expenses) is taxed three ways, and a fourth if you live in New York City:
- Federal self-employment tax: 15.3% on most of your profit (92.35% of it). That’s 12.4% for Social Security, on earnings up to $184,500 in 2026, plus 2.9% for Medicare with no cap. Estimate it with the self-employment tax calculator.
- Federal income tax: 10% to 37% on what’s left after three deductions: the $16,100 standard deduction ($32,200 married filing jointly), half of your self-employment tax, and the 20% QBI deduction.
- New York State income tax: 3.9% to 10.9% on your profit, minus half of your self-employment tax and the $8,000 standard deduction. You report it on Form IT-201.
- New York City income tax: 3.078% to 3.876%, if you live in one of the five boroughs. It’s figured on the same income as your state tax and paid on the same state return.
What’s different about New York
- No QBI deduction. The IRS lets you deduct up to 20% of your business profit. New York doesn’t. At $80,000 of profit, that’s $11,650 you deduct on your federal return but still pay New York tax on.
- Some federal deductions carry over. Because New York starts with the income on your federal return, three deductions you take there also lower your New York tax: half of your self-employment tax, self-employed health insurance premiums, and self-employed 401(k) contributions.
- Lower rates in 2026. New York cut its five lowest rates by 0.1 point for 2026, and cuts them again for 2027.
- Higher earners lose the lower brackets. Once your income passes about $107,650, New York gradually taxes more of your income at your top rate. By about $157,650 for a single filer, all of it is.
At $80,000 of profit, a single self-employed person pays $20,065 in New York State: about $805 more than in California and $3,418 more than in Texas. In New York City, the total rises to $22,304.
New York State income tax rates for 2026
These are the 2026 rates, on your income after the standard deduction.
| Rate | Single or married filing separately | Married filing jointly |
|---|---|---|
| 3.9% | $0 – $8,500 | $0 – $17,150 |
| 4.4% | $8,500 – $11,700 | $17,150 – $23,600 |
| 5.15% | $11,700 – $13,900 | $23,600 – $27,900 |
| 5.4% | $13,900 – $80,650 | $27,900 – $161,550 |
| 5.9% | $80,650 – $215,400 | $161,550 – $323,200 |
| 6.85% | $215,400 – $1,077,550 | $323,200 – $2,155,350 |
| 9.65% | $1,077,550 – $5,000,000 | $2,155,350 – $5,000,000 |
| 10.3% | $5,000,000 – $25,000,000 | $5,000,000 – $25,000,000 |
| 10.9% | Over $25,000,000 | Over $25,000,000 |
If you live in New York City
New York City residents pay city income tax on top of state tax. Commuters who live outside the five boroughs don’t. The rates haven’t changed since 2017:
| Rate | Single | Married filing jointly |
|---|---|---|
| 3.078% | $0 – $12,000 | $0 – $21,600 |
| 3.762% | $12,000 – $25,000 | $21,600 – $45,000 |
| 3.819% | $25,000 – $50,000 | $45,000 – $90,000 |
| 3.876% | Over $50,000 | Over $90,000 |
If you live in NYC, you also get two small school tax credits on your state return, which the totals below include. Here’s what a self-employed person in NYC pays in all:
Single filer, New York City resident, 2026
| 1099 profit | Total tax | % of profit | Federal taxes | New York State tax | NYC taxes |
|---|---|---|---|---|---|
| $40,000 | $9,732 | 24.3% | $7,427 | $1,410 | $895 |
| $60,000 | $16,013 | 26.7% | $12,037 | $2,414 | $1,562 |
| $80,000 | $22,304 | 27.9% | $16,647 | $3,418 | $2,239 |
| $100,000 | $29,724 | 29.7% | $22,365 | $4,443 | $2,917 |
| $150,000 | $49,765 | 33.2% | $37,608 | $7,545 | $4,612 |
| $200,000 | $71,342 | 35.7% | $53,431 | $10,495 | $7,416 |
Married filing jointly, one self-employed spouse, New York City resident, 2026
| 1099 profit | Total tax | % of profit | Federal taxes | New York State tax | NYC taxes |
|---|---|---|---|---|---|
| $40,000 | $7,383 | 18.5% | $6,050 | $844 | $489 |
| $60,000 | $13,317 | 22.2% | $10,363 | $1,812 | $1,143 |
| $80,000 | $19,477 | 24.3% | $14,854 | $2,816 | $1,807 |
| $100,000 | $25,758 | 25.8% | $19,464 | $3,819 | $2,475 |
| $150,000 | $41,692 | 27.8% | $30,990 | $6,540 | $4,162 |
| $200,000 | $61,278 | 30.6% | $44,706 | $9,606 | $6,966 |
At $200,000, the NYC column includes $1,108 of transit tax (MCTMT). Two NYC taxes depend on how much your business earns:
- Unincorporated business tax (UBT): 4%. If your business does work in NYC and earns more than $95,000 in gross income, you file a UBT return, even if you work alone. A business credit wipes the tax out until your profit reaches roughly $100,000, then shrinks to zero by roughly $150,000. NYC residents then get part of the UBT back as a credit against your city income tax. These totals don’t include UBT.
- Transit tax (MCTMT): 0.6% in NYC, 0.34% in the suburbs. Starting in 2026, it only applies once your self-employment earnings in the NYC metro area top $150,000 (about $162,400 of profit). Then it applies to all of them.
Example: New York tax on $80,000 of 1099 income
Here’s how much a single self-employed person with $80,000 of profit and no other income would pay, step by step, with and without NYC tax:
| Step | Amount |
|---|---|
| Self-employment tax: $80,000 × 92.35% × 15.3% | $11,304 |
| $80,000 minus half of self-employment tax | $74,348 |
| Income the IRS taxes: $74,348 minus the $16,100 standard deduction and $11,650 QBI deduction | $46,599 |
| Federal income tax | $5,344 |
| Income New York taxes: $74,348 minus the $8,000 standard deduction (no QBI deduction) | $66,348 |
| New York State income tax | $3,418 |
| Total, outside NYC | $20,065 (25.1%) |
| NYC income tax, after school tax credits | $2,239 |
| Total, NYC resident | $22,304 (27.9%) |
Self-employment tax is the biggest piece. Every dollar you write off lowers your federal, state, and city taxes at once.
What tax write-offs can I claim?
How to lower your New York 1099 tax bill
At $80,000 of profit, every $1,000 of business expenses you deduct cuts about $281 from your total tax. Common write-offs for self-employed people in New York include:
- Your phone and internet, for the share you use for work
- Car expenses, using a set rate per mile or your actual costs (compare the two)
- A home office, if you use part of your home regularly and only for work (estimate yours)
- Software, equipment, and supplies you buy for your business
- Health insurance premiums you pay as a self-employed person
- Retirement contributions to a SEP-IRA or Solo 401(k)
Most of these are small purchases spread across a year of bank and card statements, which is where they get missed. See the full list of tax write-offs for self-employed people.
Track and claim every eligible deduction with Keeper
Keeper scans your accounts for write-offs and files your return — with tax pros reviewing every one.
Try it freeNew York estimated tax payments
Pay New York estimated taxes with Form IT-2105 if, beyond any tax already taken out of a paycheck, you expect to owe $300 or more in New York State tax or $300 or more in NYC tax. Any transit tax (MCTMT) also requires payments. They’re due on the same dates as your federal payments, and each is a quarter of the total:
| Payment | Share of your New York tax | Due date |
|---|---|---|
| 1st | 25% | April 15, 2026 |
| 2nd | 25% | June 15, 2026 |
| 3rd | 25% | September 15, 2026 |
| 4th | 25% | January 15, 2027 |
- City tax rides along: NYC income tax goes on the same state payments. There’s no separate city form.
- Federal payments are separate: you pay the IRS on the same four dates with Form 1040-ES.
- To avoid a penalty for paying too little, pay at least 90% of this year’s New York tax or 100% of last year’s, whichever is less. If your income last year was over $150,000, it’s 110% of last year’s tax.
Get your payment amounts with the New York quarterly tax calculator.
Should you form an LLC or S corp in New York?
You don’t need one to work as an independent contractor. If you work for yourself without forming a business, you report 1099 income on Schedule C, part of your regular tax return. New York LLCs cost more to set up than in most states:
- LLCs cost $200 to form. Within 120 days, you also have to publish a notice in two newspapers for six weeks and file proof ($50). Newspaper costs vary by county and can be high in NYC. After that, you pay $9 every two years, plus a $25 yearly New York filing fee if the LLC has New York income.
- S corps can make sense once your profit is around $80,000, when the self-employment tax savings get significant. You pay yourself a reasonable salary and take the rest as profit payouts (distributions) that aren’t subject to self-employment tax. New York needs its own S corp election (Form CT-6) and charges a small minimum tax based on revenue. New York City doesn’t recognize S corps, so in NYC the business pays city corporate tax instead of UBT.
Whether an S corp saves money depends on your profit and where you work. Run the numbers for your income.
Do self-employed people in New York charge sales tax?
Usually not. New York only taxes services it specifically lists, and most professional services, like writing, design, consulting, and coaching, aren’t on it. Taxable services include some information services, cleaning and maintaining buildings, interior decorating, and security services. Physical goods you sell are taxable too. The combined rate in NYC is 8.875%.
12 sources
- New York Tax Law §601: tax rates · nysenate.gov
- 2026 Form IT-2105 instructions (rates, NYC tax, MCTMT, estimated payments) · tax.ny.gov
- Form IT-201 instructions · tax.ny.gov
- New York Tax Law §801: MCTMT · nysenate.gov
- NYC-202 instructions: unincorporated business tax · nyc.gov
- Form IT-219 instructions: NYC UBT credit · tax.ny.gov
- Forming a limited liability company in New York · dos.ny.gov
- Form IT-204-LL instructions: LLC filing fee · tax.ny.gov
- New York S corporations · tax.ny.gov
- TB-ST-740: taxable and exempt property and services · tax.ny.gov
- IRS releases tax inflation adjustments for tax year 2026 · irs.gov
- Contribution and benefit base · ssa.gov
This article is for informational purposes only and isn’t tax, legal, or financial advice. Tax rules change and depend on your situation, so talk to a tax professional about yours.
