Taxes for Software Engineers
Income mix: Mostly W-2 wages; RSUs/ISOs common at public tech employers; occasional 1099 consulting.
Common deduction themes
- Home office only if qualifying (rare for W-2)
- Educator/training rarely deductible for employees after TCJA
- HSA / 401(k) / mega backdoor where plan allows
Software engineers often under-withhold in RSU vest years because supplemental withholding does not match the full ordinary-income hit. Model vesting with the RSU calculator, then true-up annual liability with the federal income tax tool.
If you moonlights on 1099, plan quarterly estimates and SE tax separately from your W-2 paycheck.