Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Filing Taxes

Filing Amended Tax Return1040a Income Tax FormCan I File My State Taxes Online For Free1040Amend Your TaxesH&r Block Taxes Online Free1040ez InstructionsWheres My Amended ReturnIrs 1040ezFile 1040ez OnlineTaxslayer Com Main Aspx DestinationHow To File Self Employment TaxesH&r Block Free Tax FormTaxact Com 2012Can I File 2012 Taxes In 2013Filelate Com2007 Tax Return Online FreeFile Taxes Online Free2007 Tax Returns1040ez 2012 FormHow To File Your State Taxes For Free1040 Ez Tax Form 2012How Do I Do My 2012 TaxesFederal 1040ez FormIncome Tax PreparationFile State Returns For FreeHow To Ammend TaxesTurbotax 2011State 1040 Ez Form1040x HelpExample Of Form 1040x Amended Tax ReturnAmended 2011 Tax ReturnHow Can I File 2011 Taxes OnlineFiling 2010 Taxes LateE File 2011 Tax Return In 2013Www Taxcut ComForm 1040aHow To File An Amendment On TaxesHave Not Filed 2011 TaxesWww H&rblock

Filing Taxes

Filing taxes 10. Filing taxes   Indoor Tanning Services Tax Table of Contents The tax on indoor tanning service is 10% of the amount paid for that service. Filing taxes The tax is paid by the person paying for the services and is collected by the person receiving payment for the indoor tanning services. Filing taxes Definition of indoor tanning services. Filing taxes   Indoor tanning service means a service employing any electronic product designed to incorporate one or more ultraviolet lamps and intended for the irradiation of an individual by ultraviolet radiation, with wavelengths in air between 200 and 400 nanometers, to induce skin tanning. Filing taxes The term does not include phototherapy service performed by, and on the premises of, a licensed medical professional (such as a dermatologist, psychologist, or registered nurse). Filing taxes See regulations section 49. Filing taxes 5000B-1 for more information, and special rules for qualified physical fitness facilities, undesignated payment cards, and bundled payments. Filing taxes File Form 720. Filing taxes   The person receiving the payment for indoor tanning services (collector) must collect and remit the tax and file the return. Filing taxes If the tax is not collected for any reason, the collector is liable for the tax. Filing taxes The collector is not required to make semimonthly deposits of the tax. Filing taxes Prev  Up  Next   Home   More Online Publications
Español

Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

State Consumer Protection Offices

New Hampshire Office of the Attorney General

Website: New Hampshire Office of the Attorney General

Address: New Hampshire Office of the Attorney General
Consumer Protection and Antitrust Bureau
33 Capitol St.
Concord, NH 03301

Phone Number: 603-271-3641

Toll-free: 1-888-468-4454 (Consumer Protection Hotline)

TTY: 1-800-735-2964 (NH)

Back to Top

Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

State Banking Department

Website: State Banking Department

Address: State Banking Department
53 Regional Dr., Suite 200
Concord, NH 03301

Phone Number: 603-271-3561

Toll-free: 1-800-437-5991

TTY: 1-800-735-2964

Back to Top

Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Insurance Department

Website: Insurance Department

Address: Insurance Department
21 S. Fruit St., Suite 14
Concord, NH 03301

Phone Number: 603-271-2261

Toll-free: 1-800-852-3416 (NH)

TTY: 1-800-735-2964 (NH)

Back to Top

Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Secretary of State

Website: Secretary of State

Address: Secretary of State
Bureau of Securities Regulation
107 N. Main St., #204
Concord, NH 03301

Phone Number: 603-271-1463

Toll-free: 1-800-994-4200

Back to Top

Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Public Utilities Commission

Website: Public Utilities Commission

Address: Public Utilities Commission
Consumer Affairs Division
21 S. Fruit St., Suite 10
Concord, NH 03301-2429

Phone Number: 603-271-2431

Toll-free: 1-800-852-3793 (NH)

Back to Top

The Filing Taxes

Filing taxes 12. Filing taxes   Self-Employment Tax Table of Contents What's New for 2013 What's New for 2014 Introduction Topics - This chapter discusses: Useful Items - You may want to see: Why Pay Self-Employment Tax? How To Pay Self-Employment TaxReplacing a lost social security card. Filing taxes Name change. Filing taxes Penalty for underpayment of estimated tax. Filing taxes Who Must Pay Self-Employment Tax?Limited partner. Filing taxes Community property. Filing taxes Figuring Self-Employment EarningsLandlord Participation in Farming Methods for Figuring Net EarningsRegular Method Farm Optional Method Nonfarm Optional Method Using Both Optional Methods Reporting Self-Employment Tax What's New for 2013 Tax rates. Filing taxes  For tax years beginning in 2013, the social security part of the self-employment tax increases from 10. Filing taxes 4% to 12. Filing taxes 4%. Filing taxes The Medicare part of the tax remains at 2. Filing taxes 9%. Filing taxes As a result, the self-employment tax is increased from 13. Filing taxes 3% to 15. Filing taxes 3%. Filing taxes Additional Medicare Tax. Filing taxes . Filing taxes  For tax years beginning in 2013, a 0. Filing taxes 9% Additional Medicare Tax applies to your Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income above a threshold amount. Filing taxes Use Form 8959, Additional Medicare Tax, to figure this tax. Filing taxes For more information, see the Instructions for Form 8959. Filing taxes Maximum net earnings. Filing taxes  The maximum net self-employment earnings subject to the social security part (12. Filing taxes 4%) of the self-employment tax increased to $113,700 for 2013. Filing taxes There is no maximum limit on earnings subject to the Medicare part (2. Filing taxes 9%). Filing taxes What's New for 2014 Maximum net earnings. Filing taxes  The maximum net self-employment earnings subject to the social security part of the self-employment tax for 2014 will be discussed in the 2013 Publication 334. Filing taxes Introduction Self-employment tax (SE tax) is a social security and Medicare tax primarily for individuals who work for themselves. Filing taxes It is similar to the social security and Medicare taxes withheld from the pay of most wage earners. Filing taxes You usually have to pay SE tax if you are self-employed. Filing taxes You are usually self-employed if you operate your own farm on land you either own or rent. Filing taxes You have to figure SE tax on Schedule SE (Form 1040). Filing taxes Farmers who have employees may have to pay the employer's share of social security and Medicare taxes, as well. Filing taxes See chapter 13 for information on employment taxes. Filing taxes Self-employment tax rate. Filing taxes   For tax years beginning in 2013, the self-employment tax rate is 15. Filing taxes 3%. Filing taxes The rate consists of two parts: 12. Filing taxes 4% for social security (old-age, survivors, and disability insurance) and 2. Filing taxes 9% for Medicare (hospital insurance). Filing taxes Topics - This chapter discusses: Why pay self-employment tax How to pay self-employment tax Who must pay self-employment tax Figuring self-employment earnings Landlord participation in farming Methods for figuring net earnings Reporting self-employment tax Useful Items - You may want to see: Publication 541 Partnerships Form (and Instructions) 1040 U. Filing taxes S. Filing taxes Individual Income Tax Return Sch F (Form 1040) Profit or Loss From Farming Sch SE (Form 1040) Self-Employment Tax 1065 U. Filing taxes S. Filing taxes Return of Partnership Income Sch K-1 (Form 1065) Partner's Share of Income, Deductions, Credits, etc. Filing taxes See chapter 16 for information about getting publications and forms. Filing taxes Why Pay Self-Employment Tax? Social security benefits are available to self-employed persons just as they are to wage earners. Filing taxes Your payments of SE tax contribute to your coverage under the social security system. Filing taxes Social security coverage provides you with retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits. Filing taxes How to become insured under social security. Filing taxes   You must be insured under the social security system before you begin receiving social security benefits. Filing taxes You are insured if you have the required number of credits (also called quarters of coverage). Filing taxes Earning credits in 2013. Filing taxes   You can earn a maximum of four credits per year. Filing taxes For 2013, you earn one credit for each $1,160 of combined wages and self-employment earnings subject to social security tax. Filing taxes You need $4,640 ($1,160 × 4) of combined wages and self-employment earnings subject to social security tax to earn four credits in 2013. Filing taxes It does not matter whether the income is earned in 1 quarter or is spread over 2 or more quarters. Filing taxes For an explanation of the number of credits you must have to be insured and the benefits available to you and your family under the social security program, consult your nearest Social Security Administration (SSA) office or visit the SSA website at www. Filing taxes socialsecurity. Filing taxes gov. Filing taxes Making false statements to get or to increase social security benefits may subject you to penalties. Filing taxes The Social Security Administration (SSA) time limit for posting self-employment earnings. Filing taxes   Generally, the SSA will give you credit only for self-employment earnings reported on a tax return filed within 3 years, 3 months, and 15 days after the tax year you earned the income. Filing taxes    If you file your tax return or report a change in your self-employment earnings after the SSA time limit for posting self-employment earnings, the SSA may change its records, but only to remove or reduce the amount. Filing taxes The SSA will not change its records to increase your self-employment earnings after the SSA time limit listed above. Filing taxes How To Pay Self-Employment Tax To pay SE tax, you must have a social security number (SSN) or an individual taxpayer identification number (ITIN). Filing taxes This section explains how to: Obtain an SSN or ITIN, and Pay your SE tax using estimated tax. Filing taxes An ITIN does not entitle you to social security benefits. Filing taxes Obtaining an ITIN does not change your immigration or employment status under U. Filing taxes S. Filing taxes law. Filing taxes Obtaining a social security number. Filing taxes   If you have never had an SSN, apply for one using Form SS-5, Application for a Social Security Card. Filing taxes The application is also available in Spanish. Filing taxes You can get this form at any Social Security office or by calling 1-800-772-1213. Filing taxes    You can also download Form SS-5 from the Social Security Administration website at  www. Filing taxes socialsecurity. Filing taxes gov. Filing taxes   If you have a social security number from the time you were an employee, you must use that number. Filing taxes Do not apply for a new one. Filing taxes Replacing a lost social security card. Filing taxes   If you have a number but lost your card, file Form SS-5. Filing taxes You will get a new card showing your original number, not a new number. Filing taxes Name change. Filing taxes   If your name has changed since you received your social security card, complete Form SS-5 to report a name change. Filing taxes Obtaining an individual taxpayer identification number. Filing taxes   The IRS will issue you an ITIN, for tax use only, if you are a nonresident or resident alien and you do not have, and are not eligible to get, an SSN. Filing taxes To apply for an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number. Filing taxes You can get this form by calling 1-800-829-3676. Filing taxes For more information on ITINs, see Publication 1915, Understanding Your IRS Individual Taxpayer Identification Number. Filing taxes Form W-7 and Publication 1915 are also available in Spanish. Filing taxes    You can also download Form W-7 from the IRS website at IRS. Filing taxes gov. Filing taxes Paying estimated tax. Filing taxes   Estimated tax is the method used to pay tax (including SE tax) on income not subject to withholding. Filing taxes You generally have to make estimated tax payments if you expect to owe tax, including SE tax, of $1,000 or more when you file your return. Filing taxes Use Form 1040-ES, Estimated Tax for Individuals, to figure and pay the tax. Filing taxes   However, if at least two-thirds of your gross income for 2013 or 2014 was from farming and you file your 2014 Form 1040 and pay all the tax due by March 2, 2015, you do not have to pay any estimated tax. Filing taxes For more information about estimated tax for farmers, see chapter 15. Filing taxes Penalty for underpayment of estimated tax. Filing taxes   You may have to pay a penalty if you do not pay enough estimated tax by its due date. Filing taxes Who Must Pay Self-Employment Tax? You must pay SE tax and file Schedule SE (Form 1040) if your net earnings from self-employment were $400 or more. Filing taxes The SE tax rules apply no matter how old you are and even if you are already receiving social security or Medicare benefits. Filing taxes Aliens. Filing taxes   Generally, resident aliens must pay self-employment tax under the same rules that apply to U. Filing taxes S. Filing taxes citizens. Filing taxes Nonresident aliens are not subject to self-employment tax. Filing taxes However, residents of the Virgin Islands, Puerto Rico, Guam, the Commonwealth of the Northern Mariana Islands, or American Samoa are subject to self-employment tax, as they are considered U. Filing taxes S. Filing taxes residents for self-employment tax purposes. Filing taxes For more information on aliens, see Publication 519, U. Filing taxes S. Filing taxes Tax Guide for Aliens. Filing taxes Are you self-employed?   You are self-employed if you carry on a trade or business (such as running a farm) as a sole proprietor, an independent contractor, a member of a partnership, or are otherwise in business for yourself. Filing taxes A trade or business is generally an activity carried on for a livelihood or in good faith to make a profit. Filing taxes Share farmer. Filing taxes   You are a self-employed farmer under an income-sharing arrangement if both the following apply. Filing taxes You produce a crop or raise livestock on land belonging to another person. Filing taxes Your share of the crop or livestock, or the proceeds from their sale, depends on the amount produced. Filing taxes Your net farm profit or loss from the income-sharing arrangement is reported on Schedule F (Form 1040) and included in your self-employment earnings. Filing taxes   If you produce a crop or livestock on land belonging to another person and are to receive a specified rate of pay, a fixed sum of money, or a fixed quantity of the crop or livestock, and not a share of the crop or livestock or their proceeds, you may be either self-employed or an employee of the landowner. Filing taxes This will depend on whether the landowner has the right to direct or control your performance of services. Filing taxes Example. Filing taxes A share farmer produces a crop on land owned by another person on a 50-50 crop-share basis. Filing taxes Under the terms of their agreement, the share farmer furnishes the labor and half the cost of seed and fertilizer. Filing taxes The landowner furnishes the machinery and equipment used to produce and harvest the crop, and half the cost of seed and fertilizer. Filing taxes The share farmer is provided a house in which to live. Filing taxes The landowner and the share farmer decide on a cropping plan. Filing taxes The share farmer is a self-employed farmer for purposes of the agreement to produce the crops, and the share farmer's part of the profit or loss from the crops is reported on Schedule F (Form 1040) and included in self-employment earnings. Filing taxes The tax treatment of the landowner is discussed later under Landlord Participation in Farming. Filing taxes Contract farming. Filing taxes   Under typical contract farming arrangements, the grower receives a fixed payment per unit of crops or finished livestock delivered to the processor or packing company. Filing taxes Since the grower typically furnishes labor and bears some production risk, the payments are reported on Schedule F and are therefore subject to self-employment tax. Filing taxes 4-H Club or FFA project. Filing taxes   If an individual participates in a 4-H Club or Future Farmers of America (FFA) project, any net income received from sales or prizes related to the project may be subject to income tax. Filing taxes Report the net income as “Other income” on line 21 of Form 1040. Filing taxes If necessary, attach a statement showing the gross income and expenses. Filing taxes The net income may not be subject to SE tax if the project is primarily for educational purposes and not for profit, and is completed by the individual under the rules and economic restrictions of the sponsoring 4-H or FFA organization. Filing taxes Such a project is generally not considered a trade or business. Filing taxes Partners in a partnership. Filing taxes   Generally, you are self-employed if you are a member of a partnership that carries on a trade or business. Filing taxes Limited partner. Filing taxes   If you are a limited partner, your partnership income is generally not subject to SE tax. Filing taxes However, guaranteed payments you receive for services you perform for the partnership are subject to SE tax and should be reported to you in box 14 of your Schedule K-1 (Form 1065). Filing taxes Business Owned and Operated by Spouses. Filing taxes   If you and your spouse jointly own and operate a farm as an unincorporated business and share in the profits and losses, you are partners in a partnership whether or not you have a formal partnership agreement. Filing taxes You must file Form 1065, instead of Schedule F, unless you make a joint election to be treated as a qualified joint venture. Filing taxes Making this election will allow you to avoid the complexity of Form 1065 but still give each spouse credit for social security earnings on which retirement benefits are based. Filing taxes Qualified joint venture. Filing taxes   If you and your spouse each materially participate as the only members of a jointly owned and operated farm, and you file a joint tax return for the tax year, you can make a joint election to be treated as a qualified joint venture instead of a partnership for the tax year. Filing taxes For an explanation of “material participation,” see the instructions for Schedule C, line G, and the instructions for Schedule F, line E. Filing taxes   To make this election, you must divide all items of income, gain, loss, deduction, and credit attributable to the business between you and your spouse in accordance with your respective interests in the venture. Filing taxes Each of you must file a separate Schedule F and a separate Schedule SE. Filing taxes For more information, see Qualified Joint Venture in the Instructions for Schedule SE (Form 1040). Filing taxes Spouse employee. Filing taxes   If your spouse is your employee, not your partner, you must withhold and pay social security and Medicare taxes for him or her. Filing taxes For more information about employment taxes, see chapter 13. Filing taxes Community property. Filing taxes   If you are a partner and your distributive share of any income or loss from a trade or business carried on by the partnership is community property, treat your share as your self-employment earnings. Filing taxes Do not treat any of your share as self-employment earnings of your spouse. Filing taxes Figuring Self-Employment Earnings Farmer. Filing taxes   If you are self-employed as a farmer, use Schedule F (Form 1040) to figure your self-employment earnings. Filing taxes Partnership income or loss. Filing taxes   If you are a member of a partnership that carries on a trade or business, the partnership should report your self-employment earnings in box 14, code A, of your Schedule K-1 (Form 1065). Filing taxes Box 14 of Schedule K-1 may also provide amounts for gross farming or fishing income (code B) and gross nonfarm income (code C). Filing taxes Use these amounts if you use the farm or nonfarm optional method to figure net earnings from self-employment (see Methods for Figuring Net Earnings , later). Filing taxes   If you are a general partner, you may need to reduce these reported earnings by amounts you claim as a section 179 deduction, unreimbursed partnership expenses, or depletion on oil and gas properties. Filing taxes   If the amount reported is a loss, include only the deductible amount when you figure your total self-employment earnings. Filing taxes   For more information, see the Partner's Instructions for Schedule K-1 (Form 1065). Filing taxes   For general information on partnerships, see Publication 541. Filing taxes More than one business. Filing taxes   If you have self-employment earnings from more than one trade, business, or profession, you generally must combine the net profit or loss from each to determine your total self-employment earnings. Filing taxes A loss from one business reduces your profit from another business. Filing taxes However, do not combine earnings from farm and nonfarm businesses if you are using one of the optional methods (discussed later) to figure net earnings. Filing taxes Community property. Filing taxes   If any of the income from a farm or business, other than a partnership, is community property under state law, it is included in the self-employment earnings of the spouse carrying on the trade or business. Filing taxes Lost income payments. Filing taxes   Lost income payments received from insurance or other sources for reducing or stopping farming activities are included in self-employment earnings. Filing taxes These include USDA payments to compensate for lost income resulting from reductions in tobacco quotas and allotments. Filing taxes Even if you are not farming when you receive the payment, it is included in self-employment earnings if it relates to your farm business (even though it is temporarily inactive). Filing taxes A connection exists if it is clear the payment would not have been made but for your conduct of your farm business. Filing taxes Gain or loss. Filing taxes   A gain or loss from the disposition of property that is neither stock in trade nor held primarily for sale to customers is not included in self-employment earnings. Filing taxes It does not matter whether the disposition is a sale, exchange, or involuntary conversion. Filing taxes For example, gains or losses from the disposition of the following types of property are not included in self-employment earnings. Filing taxes Investment property. Filing taxes Depreciable property or other fixed assets used in your trade or business. Filing taxes Livestock held for draft, breeding, sport, or dairy purposes, and not held primarily for sale, regardless of how long the livestock was held, or whether it was raised or purchased. Filing taxes Unharvested standing crops sold with land held more than 1 year. Filing taxes Timber, coal, or iron ore held for more than 1 year if an economic interest was retained, such as a right to receive coal royalties. Filing taxes   A gain or loss from the cutting of timber is not included in self-employment earnings if the cutting is treated as a sale or exchange. Filing taxes For more information on electing to treat the cutting of timber as a sale or exchange, see Timber in chapter 8. Filing taxes Wages and salaries. Filing taxes   Wages and salaries received for services performed as an employee and covered by social security or railroad retirement are not included in self-employment earnings. Filing taxes   Wages paid in kind to you for agricultural labor, such as commodity wages, are not included in self-employment earnings. Filing taxes Retired partner. Filing taxes   Retirement income received by a partner from his or her partnership under a written plan is not included in self-employment earnings if all the following apply. Filing taxes The retired partner performs no services for the partnership during the year. Filing taxes The retired partner is owed only the retirement payments. Filing taxes The retired partner's share (if any) of the partnership capital was fully paid to the retired partner. Filing taxes The payments to the retired partner are lifelong periodic payments. Filing taxes Conservation Reserve Program (CRP) payments. Filing taxes   Under the Conservation Reserve Program (CRP), if you own or operate highly erodible or other specified cropland, you may enter into a longterm contract with the USDA, agreeing to convert to a less intensive use of that cropland. Filing taxes You must include the annual rental payments and any onetime incentive payment you receive under the program on Schedule F, lines 4a and 4b. Filing taxes Cost share payments you receive may qualify for the costsharing exclusion. Filing taxes See Cost-Sharing Exclusion (Improvements), above. Filing taxes CRP payments are reported to you on Form 1099G. Filing taxes Individuals who are receiving Social Security retirement or disability benefits may exclude CRP payments when calculating self-employment tax. Filing taxes See the instructions for Schedule SE (Form 1040). Filing taxes Self-employed health insurance deduction. Filing taxes   You cannot deduct the self-employed health insurance deduction you report on Form 1040, line 29, from self-employment earnings on Schedule SE (Form 1040). Filing taxes Landlord Participation in Farming As a general rule, income and deductions from rentals and from personal property leased with real estate are not included in determining self-employment earnings. Filing taxes However, income and deductions from farm rentals, including government commodity program payments received by a landowner who rents land, are included if the rental arrangement provides that the landowner will, and does, materially participate in the production or management of production of the farm products on the land. Filing taxes Crop shares. Filing taxes   Rent paid in the form of crop shares is included in self-employment earnings for the year you sell, exchange, give away, or use the crop shares if you meet one of the four material participation tests (discussed next) at the time the crop shares are produced. Filing taxes Feeding such crop shares to livestock is considered using them. Filing taxes Your gross income for figuring your self-employment earnings includes the fair market value of the crop shares when they are used as feed. Filing taxes Material participation for landlords. Filing taxes   You materially participate if you have an arrangement with your tenant for your participation and you meet one or more of the following tests. Filing taxes You do at least three of the following. Filing taxes Pay, using cash or credit, at least half the direct costs of producing the crop or livestock. Filing taxes Furnish at least half the tools, equipment, and livestock used in the production activities. Filing taxes Advise or consult with your tenant. Filing taxes Inspect the production activities periodically. Filing taxes You regularly and frequently make, or take an important part in making, management decisions substantially contributing to or affecting the success of the enterprise. Filing taxes You work 100 hours or more spread over a period of 5 weeks or more in activities connected with agricultural production. Filing taxes You do things that, considered in their totality, show you are materially and significantly involved in the production of the farm commodities. Filing taxes These tests may be used as general guides for determining whether you are a material participant. Filing taxes Example. Filing taxes Drew Houston agrees to produce a crop on J. Filing taxes Clarke's cotton farm, with each receiving half the proceeds. Filing taxes Clarke advises Houston when to plant, spray, and pick the cotton. Filing taxes During the growing season, Clarke inspects the crop every few days to determine whether Houston is properly taking care of the crop. Filing taxes Houston furnishes all labor needed to grow and harvest the crop. Filing taxes The management decisions made by Clarke in connection with the care of the cotton crop and his regular inspection of the crop establish that he participates to a material degree in the cotton production operations. Filing taxes The income Clarke receives from his cotton farm is included in his self-employment earnings. Filing taxes Methods for Figuring Net Earnings There are three ways to figure your net earnings from self-employment. Filing taxes The regular method. Filing taxes The farm optional method. Filing taxes The nonfarm optional method. Filing taxes You must use the regular method unless you are eligible to use one or both of the optional methods. Filing taxes See Figure 12-1 , shown later. Filing taxes Figure 12-1. Filing taxes Can I Use the Optional Methods? Please click here for the text description of the image. Filing taxes Figure 12–1. Filing taxes Can I Use the Optional Methods? Why use an optional method?   You may want to use the optional methods (discussed later) when you have a loss or a small net profit and any one of the following applies. Filing taxes You want to receive credit for social security benefit coverage. Filing taxes You incurred child or dependent care expenses for which you could claim a credit. Filing taxes (An optional method may increase your earned income, which could increase your credit. Filing taxes ) You are entitled to the earned income credit. Filing taxes (An optional method may increase your earned income, which could increase your credit. Filing taxes ) You are entitled to the additional child tax credit. Filing taxes (An optional method may increase your earned income, which could increase your credit. Filing taxes ) Effects of using an optional method. Filing taxes   Using an optional method could increase your SE tax. Filing taxes Paying more SE tax may result in you getting higher social security disability or retirement benefits. Filing taxes   If you use either or both optional methods, you must figure and pay the SE tax due under these methods even if you would have had a smaller SE tax or no SE tax using the regular method. Filing taxes   The optional methods may be used only to figure your SE tax. Filing taxes To figure your income tax, include your actual self-employment earnings in gross income, regardless of which method you use to determine SE tax. Filing taxes Regular Method Multiply your total self-employment earnings by 92. Filing taxes 35% (. Filing taxes 9235) to get your net earnings under the regular method. Filing taxes See Short Schedule SE, line 4, or Long Schedule SE, line 4a. Filing taxes Net earnings figured using the regular method are also called “actual net earnings. Filing taxes ” Farm Optional Method Use the farm optional method only for self-employment earnings from a farming business. Filing taxes You can use this method if you meet either of the following tests. Filing taxes Your gross farm income is $6,960 or less. Filing taxes Your net farm profits are less than $5,024. Filing taxes Gross farm income. Filing taxes   Your gross farm income is the total of the amounts from: Schedule F (Form 1040), line 9, and Schedule K-1 (Form 1065), box 14, code B (from farm partnerships). Filing taxes Net farm profits. Filing taxes   Net farm profits generally are the total of the amounts from: Schedule F (Form 1040), line 34, and Schedule K-1 (Form 1065), box 14, code A (from farm partnerships). Filing taxes However, you may need to adjust the amount reported on Schedule K-1 if you are a general partner or if it is a loss. Filing taxes For more information, see Partnership income or loss , earlier. Filing taxes Figuring farm net earnings. Filing taxes   If you meet either of the two tests explained above, use Table 12-1. Filing taxes Figuring Farm Net Earnings , to figure your net earnings from self-employment under the farm optional method. Filing taxes Table 12-1. Filing taxes Figuring Farm Net Earnings IF your gross farm income  is. Filing taxes . Filing taxes . Filing taxes THEN your net earnings are equal to. Filing taxes . Filing taxes . Filing taxes $6,960 or less Two-thirds of your gross farm income. Filing taxes More than $6,960 $4,640 Optional method can reduce or eliminate SE tax. Filing taxes   If your gross farm income is $6,960 or less and your farm net earnings figured under the farm optional method are less than your actual net earnings, you can use the farm optional method to reduce or eliminate your SE tax. Filing taxes Your actual net earnings are your net earnings figured using the regular method, explained earlier. Filing taxes Example. Filing taxes Your gross farm income is $540 and your net farm profit is $460. Filing taxes Consequently, your net earnings figured under the farm optional method are $360 (2/3 of $540) and your actual net earnings are $425 (92. Filing taxes 35% of $460). Filing taxes You owe no SE tax if you use the optional method because your net earnings under the farm optional method are less than $400. Filing taxes Nonfarm Optional Method This is an optional method available for determining net earnings from nonfarm self-employment, much like the farm optional method. Filing taxes If you are also engaged in a nonfarm business, you may be able to use this method to figure your nonfarm net earnings. Filing taxes You can use this method even if you do not use the farm optional method for determining your farm net earnings and even if you have a net loss from your nonfarm business. Filing taxes For more information about the nonfarm optional method, see Publication 334. Filing taxes You cannot combine farm and nonfarm self-employment earnings to figure your net earnings under either of the optional methods. Filing taxes Using Both Optional Methods If you use both optional methods, you must add the net earnings figured under each method to arrive at your total net earnings from self-employment. Filing taxes You can report less than your total actual farm and nonfarm net earnings but not less than actual nonfarm net earnings. Filing taxes If you use both optional methods, you can report no more than $4,640 as your combined net earnings from self-employment. Filing taxes Reporting Self-Employment Tax Use Schedule SE (Form 1040) to figure and report your SE tax. Filing taxes Then, enter the SE tax on line 56 of Form 1040 and attach Schedule SE to Form 1040. Filing taxes Most taxpayers can use Section A–Short Schedule SE to figure their SE tax. Filing taxes However, certain taxpayers must use Section B–Long Schedule SE. Filing taxes Use the chart on page 1 of Schedule SE to find out which one to use. Filing taxes If you have to pay SE tax, you must file Form 1040 (with Schedule SE attached) even if you do not otherwise have to file a federal income tax return. Filing taxes Deduction for employer-equivalent portion of self-employment tax. Filing taxes   You can deduct the employer-equivalent portion of your SE tax in figuring your adjusted gross income. Filing taxes This deduction only affects your income tax. Filing taxes It does not affect either your net earnings from self-employment or your SE tax. Filing taxes   To deduct the tax, enter on Form 1040, line 27, the amount shown on Section A, Line 6, or Section B, line 13, Deduction for employer-equivalent portion of self-employment tax, of the Schedule SE. Filing taxes Joint return. Filing taxes   Even if you file a joint return, you cannot file a joint Schedule SE. Filing taxes This is true whether one spouse or both spouses have self-employment earnings. Filing taxes Your spouse is not considered self-employed just because you are. Filing taxes If both of you have self-employment earnings, each of you must complete a separate Schedule SE. Filing taxes However, if one spouse uses the Short Schedule SE and the other spouse has to use the Long Schedule SE, both can use the same form. Filing taxes Attach both schedules to the joint return. Filing taxes If you and your spouse operate a business as a partnership, see Business Owned and Operated by Spouses and Qualified joint venture , earlier, under Who Must Pay Self-Employment Tax . Filing taxes Prev  Up  Next   Home   More Online Publications