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    todohere's Avatar
    todohere Posts: 5, Reputation: 1
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    #1

    Dec 27, 2012, 10:02 PM
    Self-employment taxes - do I subtract $400?
    If I earned $4000, do I subtract $400 from it considering first $400 is tax-free? I haven't seen it mentioned everywhere, but a couple places did mention it.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Dec 27, 2012, 10:09 PM
    This subtraction is done on Schedule SE where you calculate the self-employment tax.
    todohere's Avatar
    todohere Posts: 5, Reputation: 1
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    #3

    Dec 27, 2012, 10:30 PM
    I didn't find any spot on Schedule SE to subtract this $400.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #4

    Dec 28, 2012, 06:07 AM
    Look on Line #4 of the Schedule SE
    todohere's Avatar
    todohere Posts: 5, Reputation: 1
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    #5

    Dec 28, 2012, 04:39 PM
    It only talks about whether it is less than or greater than $400. It doesn't mention whether I am supposed to subtract $400. For example, if I earned $4000, do I pay tax on .9252*4000? Or on .9252*4000-400?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #6

    Dec 28, 2012, 05:20 PM
    The FIRST calculation.
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