Preparing Your Tax Return(s) and Information Returns
Self-Employment Tax
Self-employment tax is the social security and Medicare
tax for individuals who work for themselves. Your payments of self-employment
tax contribute to your coverage under the social security system. Social
security coverage provides you with retirement benefits, disability benefits,
survivor benefits, and medical insurance (Medicare) benefits.
You must pay self-employment tax if your net earnings from
self-employment are $400 or more.
TAX TIP: Deduct one-half of your self-employment
tax as an adjustment to income on your Form 1040.
Important References
Publication
583
Business Taxes
Form
1040 Schedule SE
Self-Employment Tax
1040
Schedule SE Instructions
