Tennessee Self-Employment Tax & Rate Calculator 2026

What hourly rate does a Tennessee freelancer need in 2026?

Tennessee has no state income tax on wages or self-employment income. To take home $100,000 a year as a single filer in Tennessee, charge at least $129 an hour. That covers $20,685 of self-employment tax, $13,712 of federal income tax and $7,800 of business expenses across 1,200 billable hours (2026 rules).

Hourly rate needed in Tennessee by take-home pay

30 billable hours a week, 4 weeks off, $500 a month of business expenses, no health insurance or retirement savings, tax year 2026.

Required hourly rate in Tennessee by take-home pay and filing status
Take-home pay	Single	Married filing jointly	Tax share (single)
$50,000	$48/hr	$47/hr	18.4%
$75,000	$71/hr	$69/hr	20.8%
$100,000	$96/hr	$92/hr	23.3%
$150,000	$147/hr	$138/hr	25.8%
$200,000	$200/hr	$182/hr	28.3%

Tennessee income tax for freelancers in 2026

Tennessee has no personal income tax on wages or self-employment income in 2026.

Tennessee does not levy a personal income tax on wages or self-employment income. Freelancers there pay federal income tax and the 15.3% self-employment tax only.

How the calculator handles Tennessee

Tennessee has no personal income tax on wages or self-employment income (the Hall tax on investment income was fully repealed for tax years beginning in 2021).
Important for LLC owners: unlike a sole proprietorship, a Tennessee LLC owned by an individual is NOT disregarded for franchise and excise tax. It must file Form FAE170 every year and pay franchise tax of 0.25% of net worth ($100 minimum). It also owes the 6.5% excise tax on net earnings, but a single-member LLC owned by an individual may deduct the earnings subject to federal self-employment tax (Schedule J2), so for a typical service freelancer the excise tax is usually $0 or small. The calculator does not include the franchise tax; sole proprietors without an LLC are exempt.
State business tax on gross receipts applies only when gross sales in a county (and separately in a city) reach $100,000 (most services: Classification 3, 0.1875%; minimum $22 per location, $44 inside a city); between $3,000 and $100,000 only a $15 minimal activity license per county/city is required. Not modeled.

Local income taxes in Tennessee

Tennessee cities and counties do not levy a local income tax.

Tennessee estimated tax payments

Who must pay: Not required. Not applicable: no personal income tax. (LLCs subject to franchise and excise tax have separate quarterly estimate rules.)
Safe harbor: Not applicable.
Form: None

Federal estimated payments follow their own schedule. Work them out with the quarterly estimated tax calculator.

Business costs for a Tennessee freelancer

LLC formation fee	$300 Articles of Organization for a single-member LLC ($50 per member, $300 minimum, $3,000 maximum; Tennessee Secretary of State form SS-4270).
Annual report	$300 annual report for an LLC with up to 6 members (plus $50 per member over 6, $3,000 maximum), due every year by the first day of the fourth month after fiscal year end (April 1 for calendar-year entities).
Franchise or minimum tax	LLCs (including single-member LLCs owned by an individual) must file a franchise and excise tax return (FAE170) each year: franchise tax of 0.25% of net worth with a $100 annual minimum, plus 6.5% excise tax on net earnings after deducting earnings subject to federal self-employment tax (so a service freelancer's LLC usually owes little or no excise tax and pays about the $100 minimum). Sole proprietors and general partnerships are not subject.
Gross receipts tax	Tennessee business tax applies once gross sales in a county or city reach $100,000: most services are Classification 3 at 0.1875% of gross receipts, $22 minimum per location ($44 in a city). Between $3,000 and $100,000 only a $15 minimal activity license per county (and city) is required; $3,000 or less needs no license.

You don’t need an LLC to freelance as a sole proprietor. Compare the tax treatment in LLC vs sole proprietor for freelancers.

What else a Tennessee freelancer deals with

Hall income tax is repealed

The Tennessee Department of Revenue says the Hall income tax applied only to interest from bonds and notes and to dividends from stock. It was repealed for tax periods beginning on or after January 1, 2021, and the Department asks that no return be filed for those years. Tennessee does not tax wages or self-employment income. (source)

Franchise and excise tax: LLCs yes, sole proprietors no

According to the Department's June 2026 Franchise and Excise Tax Manual, sole proprietors and general partnerships are not subject to franchise and excise tax. LLCs registered or doing business in Tennessee are. A single-member LLC is disregarded only when its single member is a corporation, so an LLC owned by one individual files its own return. Franchise tax is 0.25% of Tennessee net worth with a $100 minimum, and excise tax is 6.5% of Tennessee taxable income. (source 1, source 2, source 3)

Excise deduction for self-employment income

The June 2026 manual says a single-member LLC owned by an individual completes Schedule J2. It may deduct income subject to federal self-employment tax, but the deduction cannot create or increase a net loss. Earnings on federal Schedule C are generally subject to self-employment tax. The $100 minimum franchise tax still applies. For calendar-year filers the return is due April 15, and quarterly estimates are required at $5,000 or more of combined liability. (source 1, source 2)

Business tax thresholds and licenses

For tax years ending on or after December 31, 2023, an in-state location with gross receipts over $3,000 but under $100,000 needs only a minimal activity license from the county or municipal clerk. At $100,000 or more it needs a standard license and pays state business tax, plus city business tax where enacted. A separate $15 license registration fee is paid to the clerk. The return is due the 15th day of the fourth month after the fiscal year ends, with a $22 minimum tax. (source 1, source 2, source 3)

Service businesses: Classification 3 and exempt services

Business tax Classification 3 covers service businesses, and its retail rate is 0.001875 (0.1875%) of gross receipts. The Department lists services whose receipts are exempt, with no business license needed and no tax due. They include accounting, architecture, engineering, legal, surveying, and medical, dental and allied health services, along with several other categories. (source 1, source 2)

Frequently asked questions

Does Tennessee have a state income tax on freelance income?

No. Tennessee does not tax wage or self-employment income, so freelancers there pay federal income tax and self-employment tax only. Business taxes can still apply: Tennessee business tax applies once gross sales in a county or city reach $100,000: most services are Classification 3 at 0.1875% of gross receipts, $22 minimum per location ($44 in a city). Between $3,000 and $100,000 only a $15 minimal activity license per county (and city) is required; $3,000 or less needs no license.

Do freelancers in Tennessee pay state estimated taxes?

No. Tennessee does not require state income tax estimated payments. Not applicable: no personal income tax. (LLCs subject to franchise and excise tax have separate quarterly estimate rules.)

Sources for Tennessee figures

Verified October 22, 2026 against official Tennessee and IRS publications.

Estimates for educational and planning purposes only. HourFloor does not provide tax, legal or financial advice. Verify your numbers with a qualified tax professional.

Tennessee freelance rate & 1099 tax calculator

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