Self-Employment Tax
Overview
SE Tax Rates & Caps
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2025 Cap is $176,100,
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$21,836.40 maximum tax @ 12.4%).
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The $176,100 cap is reduced for any FICA wages.
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Medicare element is 2.9% with No Cap.
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Additional 0.9% Medicare tax if SE income exceeds $200K/$250K/$125K threshold
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$400 SE Income Threshold (no SE tax if total SE income is under $433 ($433 x 92.35% = $400).
Self-Employment Income Generally Includes
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Schedule C Income
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Schedule F Income
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SE Income from a Partnership K-1
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Miscellaneous Income from a Regularly Conducted Trade or Business
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Excluded Foreign Earned Income of self-employed person
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Back Pay – At rates for year of payment
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Professional Fiduciary
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Agricultural Co-op Payments to Retired Farmers
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Fishing Crew Member
Self-Employment Income Generally Does Not Include
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Rental Income from Schedule E
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Sub-chapter S K-1 Income (Taxpayer is supposed to take a reasonable wage on which FICA would be withheld.)
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Miscellaneous Income from an Occasional Act or Transaction
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Services performed as Notary Public
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Non-Professional Fiduciary
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Limited Partners’ Share of Income
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Newspaper Vendors under age 18
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Termination Payments of Former Insurance Salespeople
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Taxpayer's Child Employee under age 18
Non-Farm Optional Method
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2025 Gross $10,860 or less (up from $10,380 in 2024)
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2025 SE Net is less than $7,240 (up from $6,920 in 2024)
Related IRC and IRS Publications and Forms
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Schedule SE (Form 1040) – Self-Employment Tax
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Form 8919 – Uncollected SS and Medicare Tax on Wages
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Pub 225 – Farmer’s Tax Guide
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Pub 334 – Tax Guide for Small Business
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Pub 517 – SS and Other Info for Religious Workers
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Pub 595 – Tax Highlights for Commercial Fishermen
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IRC Sec 3101
California Differences
California has no equivalent tax. Nonetheless, California allows 50% of the SE tax to be claimed as an adjustment to gross income.