Freelance Hourly Rate Calculator
Work backward from the take-home pay you actually want — after expenses and taxes — to the hourly rate you need to charge.
Your details
Rough figures are fine — you can refine later.
How we calculate this
We solve for the rate that produces your desired take-home after expenses and taxes.
1. Required revenue. (Target take-home + business expenses) ÷ (1 − tax rate). Dividing by (1 − tax rate) "grosses up" your goal so what's left after tax equals what you wanted.
2. Billable hours. Billable hours per week × working weeks per year.
3. Rate. Required revenue ÷ billable hours.
This is a pricing tool, not tax advice — the tax rate is an estimate you provide. We flag billable hours above 30/week because utilization is the single most common reason a "good enough" rate leaves freelancers short.
Primary sources
- General freelance pricing methodology (cost-plus / target-income)
- Utilization-rate norms for solo service businesses
Price from your goal, not from a number you saw online
Most freelancers set a rate by copying what someone else charges, or by nudging up from an old employer's hourly wage. Both start in the wrong place. Your rate isn't a market average — it's the number that, after expenses and taxes and the hours you can't bill, leaves you with the income you actually need. This calculator works backward from that goal.
Tell it the take-home you want, your business expenses, how many hours you can realistically bill each week, and a tax estimate. It returns the hourly rate that produces that take-home, the total revenue you'd need to bill in a year, and the annual billable hours you're planning around.
Why the rate is higher than it "feels"
There's a gap between what a client pays per hour and what you keep, and three things open it up.
Taxes come out first. As a freelancer you owe self-employment tax (both halves of Social Security and Medicare, 15.3% of net earnings) on top of income tax. Dividing by (1 − your tax rate) grosses your goal up so the after-tax amount is what you wanted, not what's left after a surprise.
Expenses come off the top. Software, hardware, insurance, subscriptions, and fees are real costs of doing business. The rate has to cover them before a dollar reaches you.
You can't bill every hour you work. This is the one that quietly wrecks rates. A 40-hour week doesn't produce 40 billable hours — sales calls, email, invoicing, admin, and breaks eat a big share. Bill 25 hours out of a 40-hour week and your true hourly rate is far below your quoted one.
The utilization trap
Because unbillable time is invisible, freelancers routinely assume they'll bill 35, 40, even 45 hours a week — then wonder why the money is short. Most solo freelancers realistically bill 50–60% of the hours they work. This tool flags any figure above 30 billable hours a week, because that's where the estimate starts to drift into wishful thinking. If you can't sustain the hours you entered, your rate needs to be higher to compensate, not lower.
Turning the rate into a business
The rate is a floor, not a ceiling. Value-based pricing, package deals, retainers, and rush premiums can all push your effective earnings above this baseline. But you can't price up from a number you never calculated. Start here to know the rate below which you're losing money, then let demand and positioning carry you above it.
What this is
A planning estimate, not tax advice. The tax rate is a figure you supply — use our tax tools to sharpen it — and the result assumes you can actually book the billable hours you enter. Treat it as the honest starting point for a rate conversation, not the final word.
Common questions
How do I calculate my freelance hourly rate? + −
Start from the take-home pay you want, add your business expenses, and divide by (1 − your tax rate) to get the revenue you must bill. Then divide that by your realistic billable hours for the year. This tool does the arithmetic — you supply the goal, expenses, hours, and an estimated tax rate.
Why is my rate so much higher than a salary hourly wage? + −
Because a freelance rate has to cover things an employer normally pays: both halves of Social Security and Medicare, health insurance, retirement, paid time off, unbillable admin hours, and business expenses. A $50/hr salary job often needs a freelance rate well north of $75–100/hr to match.
What tax rate should I use? + −
For most US freelancers, 25–30% covers combined federal income tax, self-employment tax, and a modest state rate at typical income levels. Use our Effective Tax Rate or Tax Set-Aside calculators for a figure tailored to your numbers, then plug it back in here.
How many billable hours should I assume? + −
Fewer than you think. A 40-hour week rarely yields 40 billable hours — sales, admin, email, and breaks eat into it. Billing 20–30 hours a week is realistic for many solo freelancers. If you enter more than 30, this tool flags it.
Keep going
Prepared for tax year 2026. Every rate and cap on this page cites a primary IRS or SSA source. Estimates only — not tax or financial advice. — for planning purposes only, not tax, legal, or financial advice.