If your expenses are more than your income, the difference is a net loss. If your expenses are less than your income, the difference is net profit and becomes part of your income on page 1 of Form 1040 or 1040-SR. You do this by subtracting your business expenses from your business income. In general, the wording "self-employment tax" only refers to Social Security and Medicare taxes and not any other tax (like income tax).īefore you can determine if you are subject to self-employment tax and income tax, you must figure your net profit or net loss from your business. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. SE tax is a Social Security and Medicare tax primarily for individuals who work for themselves. Self-employed individuals generally must pay self-employment (SE) tax as well as income tax.
You are otherwise in business for yourself (including a part-time business or a gig worker).īack to top What are My Self-Employed Tax Obligations?Īs a self-employed individual, generally you are required to file an annual return and pay estimated tax quarterly.You are a member of a partnership that carries on a trade or business.You carry on a trade or business as a sole proprietor or an independent contractor.Generally, you are self-employed if any of the following apply to you. Married Couples Business - What is a Qualified Joint Venture?.Am I Required to File an Information Return?.What Are My Self-Employed Tax Obligations?.
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