Schedule SE
Schedule SE
Self-Employment Tax
Every line is explained below in plain English — click any line to see what it means, who needs to fill it in, and what people commonly overlook.
Section A — Short Schedule SE
- 1a Net Farm Profit or Loss Your net farm profit or loss from Schedule F, line 34, plus any farm income from partnership Schedule K-1 (Form 1065), box 14, code A. If you operated a...
- 1b CRP Payments Adjustment An adjustment for Conservation Reserve Program (CRP) payments if you receive Social Security retirement or disability benefits.
- 2 Net Nonfarm Profit or Loss Your net profit or loss from Schedule C, line 31, plus any nonfarm self-employment income from partnership Schedule K-1 (Form 1065), box 14, code A. This...
- 3 Combined SE Earnings The sum of lines 1a, 1b, and 2. This is your total net self-employment earnings from all sources -- farm and nonfarm -- before the 92.35% adjustment.
- 4a SE Earnings Calculation Multiply line 3 by 92.35% (0.9235). This adjustment accounts for the employer-equivalent portion of FICA tax.
- 4b Optional Method Total The total from the optional methods calculated in Section B (lines 15 and 17). This line is blank for most filers.
- 4c Total SE Earnings The combined total of lines 4a and 4b. This is your total self-employment earnings subject to SE tax.
- 5a Social Security Wages Total wages and tips subject to Social Security tax from all your W-2 forms.
- 5b Unreported Tips Subject to Social Security Unreported tip income that is subject to Social Security tax, from Form 4137, line 10.
- 6 Total Social Security Wages and Tips The sum of lines 5a and 5b -- your total wages and tips that were already subject to Social Security tax through employment.
- 7 Maximum Social Security Earnings Limit The Social Security wage base for the tax year -- $176,100 for 2025.
- 8a Social Security Wages Entered Enter the amount from line 6 -- your total Social Security wages and tips from employment.
- 8b Remaining Social Security Ceiling Subtract line 8a from line 7.
- 9 Social Security Tax Portion Multiply the smaller of line 4c (total SE earnings) or line 8b (remaining Social Security ceiling) by 12.4% (0.124).
- 10 Medicare Tax Portion Multiply line 4c (total SE earnings) by 2.9% (0.029). This is the Medicare tax portion of your self-employment tax.
- 11 Self-Employment Tax Total Add lines 9 and 10. This is your total self-employment tax -- the combined Social Security (12.4%) and Medicare (2.9%) taxes on your net SE earnings.
- 12 Deductible Half of SE Tax Multiply line 11 by 50% (0.50). This is the deductible half of your self-employment tax. Enter it on Schedule 1 (Form 1040), line 15.
Section B — Long Schedule SE
- 14 Maximum Income for Optional Methods The maximum amount of income you can report using the optional methods.
- 15 Farm Optional Method The farm optional method lets you report two-thirds of your gross farm income as SE earnings instead of using your actual net farm profit.
- 16 Nonfarm Optional Method Subtraction Subtract line 15 from line 14. This is the remaining room under the optional method cap after the farm optional method has been applied.
- 17 Nonfarm Optional Method The nonfarm optional method lets you report two-thirds of your gross nonfarm income as SE earnings instead of using your actual net profit from Schedule C....