Quick Answer
No, freelancers do not pay Seattle's head tax. The city repealed its employee head tax in 2018, and the current JumpStart payroll tax only applies to businesses with employees earning over $150,000 annually. Solo freelancers and independent contractors are not subject to any Seattle head tax or payroll tax requirements.
Best Answer
James Okafor, Self-Employment Tax Specialist
Best for established freelancers working with Seattle businesses who want to understand their tax obligations
The short answer: No head tax for freelancers
Seattle freelancers and independent contractors do not pay a head tax. The city's current JumpStart payroll tax, enacted in 2020, only applies to businesses with employees — not to solo freelancers or independent contractors.
History of Seattle's head tax attempts
Seattle has attempted various forms of head taxes over the years:
2018 Employee Head Tax: Seattle briefly imposed a $275 per employee annual tax on businesses grossing over $20 million. This was repealed after just one month due to business opposition.
2020 JumpStart Payroll Tax: Currently in effect, this tax ranges from $0.0025 to $0.0057 per hour worked, but only applies to businesses with employees earning over $150,000 annually.
Example: Seattle freelancer vs. employee
Compare two scenarios:
Marcus (Freelancer): Web developer earning $85,000/year as a 1099 contractor for various Seattle businesses. He pays no Seattle head tax or payroll tax — these obligations fall on his clients only if they have qualifying employees.
Jennifer (Employee): Software engineer earning $160,000/year at a Seattle tech company. Her employer pays approximately $912/year in JumpStart tax on her behalf ($0.0057 × 40 hours × 52 weeks = $11.856 per $1 of wages, roughly $912 on $160,000).
What Seattle taxes DO freelancers pay?
While freelancers avoid the head tax, they're still subject to:
State Level:
Federal Level:
Business & Occupation (B&O) Tax confusion
Many freelancers confuse Seattle's head tax with Washington's B&O tax. The B&O tax applies to freelancers grossing over $12,000 annually, but it's calculated on gross receipts (typically 0.015%), not per employee.
What about working for Seattle businesses?
If you're a freelancer working for Seattle businesses subject to the JumpStart tax, this doesn't affect you directly. Your clients may factor their payroll tax costs into their pricing, but you have no direct obligation to pay or track these taxes.
What you should do
Focus on your actual tax obligations: federal self-employment tax, income tax, and Washington B&O tax if applicable. Don't spend time worrying about Seattle's head tax — it doesn't apply to independent contractors.
Use our quarterly estimator to plan for the taxes you actually owe, and ensure you're properly tracking your Washington B&O tax liability if you're above the $12,000 threshold.
Key takeaway: Seattle freelancers pay no head tax. The current JumpStart payroll tax only applies to businesses with employees earning over $150,000 annually, not to independent contractors.
Key Takeaway: Seattle freelancers pay no head tax. The current JumpStart payroll tax only applies to businesses with employees earning over $150,000 annually, not to independent contractors.
Seattle tax obligations: Freelancers vs. Employees
| Tax Type | Freelancers | Employees | Rate/Amount |
|---|---|---|---|
| Seattle JumpStart Tax | Not applicable | Employer pays | $0.0025-$0.0057/hour |
| Washington B&O Tax | Yes (if over $12K) | No (employer pays) | ~0.015% gross receipts |
| Federal Self-Employment | Yes | No (employer pays half) | 15.3% |
| Seattle Business License | Maybe | No | Varies by activity |
More Perspectives
James Okafor, Self-Employment Tax Specialist
Best for freelancers new to working in the Seattle market
Head tax confusion for new Seattle freelancers
If you're new to freelancing in Seattle, you might have heard about the city's "head tax" and wondered if it applies to you. The good news: it doesn't.
What you actually need to worry about
As a new Seattle-area freelancer, focus on these real tax obligations:
Federal taxes: You'll pay self-employment tax (15.3%) and income tax on your Schedule C profit.
Washington state: No state income tax, but you may owe B&O tax if you gross over $12,000 in a year.
Local: Seattle business license requirements depend on your specific work, but there's no head tax for independent contractors.
Why the confusion exists
Seattle's tax landscape has changed frequently, leading to confusion:
The key distinction: these taxes target businesses with employees, not solo freelancers.
Key takeaway: New Seattle freelancers should focus on federal self-employment taxes and Washington B&O tax (if applicable) — not head taxes that don't apply to independent contractors.
Key Takeaway: New Seattle freelancers should focus on federal self-employment taxes and Washington B&O tax (if applicable) — not head taxes that don't apply to independent contractors.
Sources
- Seattle Municipal Code 5.38 — JumpStart Seattle payroll tax ordinance
- IRS Publication 334 — Tax Guide for Small Business
Reviewed by James Okafor, Self-Employment Tax Specialist on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.