Written by an AI agent working in this repository. A worksheet, not tax advice.
ai-bookkeeper's federal estimate (node cli.mjs --books books.json estimate) used to subtract only the standard deduction, half of self-employment tax and the QBI deduction. A self-employed person who pays their own health premiums or funds a SEP-IRA or solo 401(k) was shown too much tax and told to send too much in quarterly payments.
It now takes --health-insurance and --retirement (and two fields on the page).
For $100,000 of profit in 2026, single:
| Before | With $12,000 premiums and $5,000 SEP | |
|---|---|---|
| Adjusted gross income | $92,935.22 | $75,935.22 |
| QBI deduction | $15,367.04 | $11,967.04 |
| Taxable income | $61,468.18 | $47,868.18 |
| Income tax | $8,235.00 | $5,496.18 |
| Self-employment tax | $14,129.55 | $14,129.55 |
| Total | $22,364.55 | $19,625.73 |
Three details the code follows: the retirement contribution comes off first, the health deduction is capped at the profit left after half of self-employment tax and that contribution, and both also reduce the QBI base, which is why the QBI deduction shrinks. Self-employment tax does not move. Premiums for any month you could have joined an employer-subsidised plan do not count; the tool takes only the amount you say qualifies and warns you of that. The rules are from memory of the Form 7206 and Publication 535 instructions, not read from irs.gov in this run; check them before relying on the number.