The core idea

What is your quit number?

Published October 2, 2026 6 min read

Your quit number is the monthly profit your sales must bring in before you can leave your job and resell full time. It can be higher than your salary, because a salary is only part of what a job pays you. On average, your employer also pays most of your health premium, and it pays half your payroll tax.

It's easy to start with the wrong sum: I earn $58,000, so reselling has to make $58,000. It's wrong three ways. It starts from salary instead of spending. It leaves out what your employer pays on top. And it forgets that business profit gets taxed before you can spend it.

How do you calculate your quit number?

Add your monthly spending and the health premium, divide by 1 minus your tax rate, then add your business's fixed costs. Five steps below walk through it; use real figures from your bank statements, not a budget of what you plan to spend.

1. Add up 12 months of actual spendingEverything that left your accounts, divided by 12. Include the irregular things: annual renewals, car repairs, gifts, the dentist. Spending is what has to be covered, not salary.
2. Add the health premium you'll pay yourselfThe full monthly premium for the cover you'll buy, not your payroll deduction. What self-employed health insurance costs shows how to find it.
3. Gross it up for taxDivide by 1 minus your tax rate. Business profit is taxed before you spend it, so the profit has to be bigger than the spending it covers.
4. Add the business's fixed costsSubscriptions, storage, insurance, accounting: the monthly costs you pay whether or not anything sells.
5. Compare it with your profit from salesYour trailing 12 months of sale price minus item cost, fees and shipping. That's the number your quit number has to beat.

Quit number = (monthly spending + health premium) ÷ (1 minus your tax rate) + fixed business costs

What does your employer pay that you'll have to cover?

Your employer pays its share of your health premium, half your payroll tax, any retirement match and your paid time off, and all of it moves to you when you quit. The two biggest pieces have federal numbers behind them.

Source: AHRQ Medical Expenditure Panel Survey, Insurance Component, 2025, private-sector averages (employer share = total premium minus employee contribution); IRS. Read 2 October 2026.

Why gross up your quit number for tax?

Your quit number gets grossed up because the IRS taxes business profit before you spend it. Self-employment tax alone is 15.3% on 92.35% of net earnings, about 14.1% of profit, before any federal or state income tax (IRS). That holds below the yearly Social Security earnings limit; above it, the 12.4% Social Security part stops. Half of it is deductible when you figure income tax, which lowers your income tax but not the self-employment tax itself.

Use a rate from your own tax history or from a tax professional. The example below assumes 27%: about 14.1 points of self-employment tax and 12.9 points standing in for income tax. That split is an assumption, not a prediction of your bill.

One thing works in your favor. If you qualify for the self-employed health insurance deduction, the premium lowers your income tax, though not your self-employment tax, and you can't take it for any month you could join an employer's subsidized plan, including a spouse's (IRS Form 7206 instructions). The quit number leaves the deduction out, which keeps it on the safe side.

What does a worked quit number look like?

In this example, not a typical case, a household spending $3,400 a month and paying the 2025 national average single premium in full needs a quit number of $6,088 a month.

That's about $73,000 a year of profit from sales to replace a job paying $58,000. The gap is who was paying for what. On a $58,000 salary, the employer's half of Social Security and Medicare is $4,437 a year, and in 2025 the average employer share of a single premium was about $7,208.

How many sales does a quit number take?

A quit number turns into sales when you divide it by your average profit per sale. At $20 a sale, the example's $6,088 needs 305 sales a month, about 10 a day. The full-time reselling math carries that on to listings and listing hours a week.

Is your quit number the same as your target income?

Your quit number is a floor, not a target. It gets you to break-even with your current life and holds nothing for a slow quarter, for growth, or for the risk you're taking. Plan to earn above it, and hold enough savings to cover the gap months.

A number hit once proves little. What counts is whether your worst months clear it, which is what the income floor test checks.

Sources

Every rule and figure on this page was checked against these pages, read 2 October 2026.

• IRS: Self-employment tax (Social Security and Medicare taxes)
• IRS Topic 554: Self-employment tax (the 92.35% rule)
• IRS Topic 751: Social Security and Medicare withholding rates
• IRS: Instructions for Form 7206, self-employed health insurance deduction
• AHRQ MEPS-IC 2025, Tables I.C and I.D: private-sector premiums and employee shares

Keep reading

• Can reselling be a full-time job? Run your own numbers

  Your quit number in sales, listings and listing hours a week, worked out step by step.

• How much money do you need saved before you quit?

  Months of spending plus the health premium, and a separate reserve for inventory.