I'm starting a new business. Do I need to pay the self-employment tax?
So, you’ve started a business and freed yourself from the daily grind of that old job. But there’s no freedom from paying taxes. In fact, you’ll owe tax that you never had to pay as an employee. The self-employment tax (officially known as the SECA tax for Self-Employment Contributions Act tax) is the self-employed person's version of the FICA (Federal Insurance Contributions Act) tax paid by employers and employees for Social Security and Medicare, and it's due on your net earnings from self-employment.