Your quarterly estimates were perfect. Every voucher matched the safe harbor, the SE tax math checked out, and then April brought a bill for $900 you never modeled. That is the usual introduction to the additional Medicare tax for self-employed workers: a 0.9% surtax on earnings above $200,000 that lives outside the self-employment tax calculation entirely. Nothing withholds it for you, most calculators skip it, and it has a few properties that make it worse than it looks.
What the 0.9% tax is and who pays it
The Additional Medicare Tax dates to the Affordable Care Act and took effect in 2013. It adds 0.9% on top of the regular Medicare tax for high earners. The regular Medicare piece, 2.9% for the self-employed, has no wage base; the surtax kicks in only above a threshold: $200,000 for single filers, $250,000 for married filing jointly, $125,000 for married filing separately. Wages, self-employment income, and railroad compensation all count toward the same threshold, so a $150,000 W-2 plus $100,000 of freelance profit puts a single filer $50,000 over. That combination case is covered in our W-2 plus side income guide.
For employees, the employer starts withholding the 0.9% once wages from that one employer pass $200,000, regardless of filing status, and any mismatch gets sorted out on Form 8959 at filing time. The self-employed get no such machinery. Nobody withholds it. You compute it on Form 8959 yourself and you pay it with your return, which is why it keeps arriving as a surprise.
How the additional Medicare tax hits self-employed income: the 0.9% math
Single filer, $300,000 in net self-employment income. The regular SE tax works the way you expect: 15.3% on the first $184,500 of the 92.35% base, then 2.9% Medicare on the rest. The surtax is simpler and meaner: 0.9% on the $100,000 above the $200,000 threshold. That is $900, added to everything else.
Now the detail most people miss, and the reason this tax punches above its 0.9% weight: it applies to your full net earnings, not the 92.35% reduced base. The 7.65% haircut that shrinks regular SE tax does not exist here. On $300,000 of net earnings the difference is small, about $69, but on larger incomes it adds up, and more importantly it means you cannot reuse your SE tax worksheet. The surtax needs its own line of math.
Two more properties, both unfavorable. The 0.9% is not deductible. The familiar deduction for half of self-employment tax stops at the regular SE tax; the surtax gets no offset. And the thresholds have not moved since 2013. They are not indexed to inflation, which means every year of wage growth pushes more people across a line drawn over a decade ago. A freelancer who crossed $200,000 for the first time in 2026 is paying a tax designed for 2013's definition of high income.
Putting it in your estimates
The fix is boring, which is why nobody does it. Once your net earnings are running above your filing-status threshold, add 0.9% of the excess to each quarterly estimate. On a $300,000 single-filer year, that is $225 a quarter. Leave it out and you can hit the safe harbor on income tax and SE tax and still owe an underpayment penalty on the surtax portion, because the penalty looks at total tax, not the parts you remembered.
One honest caveat: the 0.9% is the smallest of the problems at this income level. The regular Medicare piece keeps climbing with no cap, state taxes take their cut, and the QBI deduction starts phasing out. I would not reorganize your business around the surtax. I would just stop being surprised by it. The threshold table has sat unchanged for thirteen years; plan like it will sit unchanged for thirteen more.
Frequently asked questions
What is the Additional Medicare Tax rate for self-employed workers?
0.9% on net earnings from self-employment above $200,000 for single filers, $250,000 for married filing jointly, and $125,000 for married filing separately. It sits on top of the regular 2.9% Medicare portion of self-employment tax, and there is no employer to split it with.
What are the Additional Medicare Tax thresholds for 2026?
$200,000 single, $250,000 married filing jointly, $125,000 married filing separately. The thresholds have not been adjusted for inflation since the tax took effect in 2013, so more earners cross them every year.
Does the 0.9% apply to the 92.35% reduced amount or full net earnings?
Full net earnings. The 92.35% reduction that shrinks the base for regular self-employment tax does not apply to the Additional Medicare Tax. You multiply 0.9% by your total net earnings from self-employment above the threshold.
Do self-employed workers include the Additional Medicare Tax in quarterly estimated payments?
Yes. It is part of your total tax liability, so fold it into your quarterly estimates. Leaving it out is a common cause of an underpayment penalty for high-earning freelancers who otherwise estimate carefully.
Is the Additional Medicare Tax deductible?
No. The deduction for half of self-employment tax does not cover the 0.9% surtax. You pay it in full with no offsetting deduction.
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