Schedule SE (Form 1040): Self-Employment Tax

File Schedule SE if the amount on line 4c is $400 or more, or if you had church employee income of $108.28 or more. You must pay self-employment tax if you had net earnings of $400 or more as a self-employed person. If you filed Form 4029 or Form 4361 and received IRS approval, you may not need to file. Even with a loss or a small amount of income, filing and using an optional method may work in your favor.

• Line 4c comes to $400 or more
• Church employee income of $108.28 or more
• Each spouse with self-employment income files a separate Schedule SE
• Two or more businesses get combined on one Schedule SE

The form carries no filing date of its own. You complete it when you file your income tax return and attach it there, at Attachment Sequence No. 17. Residents of the U.S. Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and Puerto Rico file Schedule SE with Form 1040-SS. A self-employed nonresident alien living in the United States whose income is subject to the tax files it with Form 1040-NR.

Start with your business results. Line 1a takes farm profit or loss, line 2 takes nonfarm profit or loss, and line 3 combines those with line 1b. Multiply line 3 by 92.35% on line 4a. If line 4c is less than $400, stop, because you do not owe self-employment tax. Otherwise add church employee income, cap the social security part at $176,100 of combined wages and self-employment earnings, then multiply by 12.4% on line 10 and by 2.9% on line 11.

Line 12 is your self-employment tax. It goes on Schedule 2 (Form 1040), line 4, or Form 1040-SS, Part I, line 3. Line 13 takes half of line 12, found by multiplying by 50%, and that amount goes on Schedule 1 (Form 1040), line 15. Skip line 13 if you are filing Form 1040-SS. Enter all negative amounts in parentheses.

For 2025, the maximum amount of self-employment income subject to social security tax is $176,100. Line 7 is printed with that figure, and line 8a tells you to skip lines 8b through 10 if your social security wages and tips already reach $176,100. Line 14 sets the maximum income for the optional methods at $7,240. If your tax year is a fiscal year, use the tax rate and annual earnings limit that apply when the fiscal year begins.

Part II can give you credit toward your social security coverage even if you had a loss or a small amount of income. You may use the farm optional method if your gross farm income was not more than $10,860 or your net farm profits were less than $7,840. Line 15 reports two-thirds of gross farm income, up to $7,240, as your net earnings. There is no limit on how many years you can use this method.

The nonfarm optional method asks for net nonfarm profits under $7,840 that are also less than 72.189% of your gross nonfarm income, plus net earnings from self-employment of at least $400 in 2 of the 3 prior years. You may use it no more than five times, and the 5 years do not have to be consecutive. If you use both methods, you cannot report more than $7,240 of net earnings. You can change methods after filing by using Form 1040-X.

A 0.9% Additional Medicare Tax may apply if the total on line 6 of all your Schedules SE goes above $250,000 for married filing jointly, $125,000 for married filing separately, or $200,000 for single, head of household, or qualifying surviving spouse. If you have wages too, that threshold drops by the amount of wages subject to Additional Medicare Tax. Use Form 8959 to figure it. Statutory employees leave Schedule C, line 31, off line 2 and instead put their Form W-2 social security wages and tips on line 8a.