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Taxact 2007

Irs Form 2011Form 1040 XAmending 2010 Tax ReturnFile Previous Years Tax ReturnsState Tax Form 2013Need 2009 TaxesMilitary State Tax1040ez 2012 Tax Form1040ez Tax Form For 2012Free Military Tax FilingFree State Tax Filing Online State ReturnFile 2010 Tax Return Online FreeFree Turbo Tax For Low IncomeTurbotax 2011 Tax Return1040ez State Tax FormWww Myfreetaxes Com Swflorida2010 Form 10402012 H&r Block Tax SoftwareState Tax Mailing AddressMilitary Tax Filing2011 Form 1040ezCan I Efile A 1040xFile State Tax Return FreeAmended Income Tax ReturnFree Amended Tax Return1040ez Printable Tax FormsHow To Complete A 1040xHow Do I File Taxes For 2010State Income Tax Rate Comparisons1040ez 2009H And R BlockState Income TaxFederal And State Income Tax FormsFederal Tax Return 1040ez2013 Federal Tax Forms 1040ezI Need To File My 2010 TaxesAmmended Tax ReturnsWhere To File A 1040xFree Tax Forms 20121040

Taxact 2007

Taxact 2007 Publication 547 - Introductory Material Table of Contents What's New Reminders IntroductionOrdering forms and publications. Taxact 2007 Tax questions. Taxact 2007 Useful Items - You may want to see: What's New Section C of Form 4684 for Ponzi-type investment schemes. Taxact 2007  Section C of Form 4684 is new for 2013. Taxact 2007 You must complete Section C if you are claiming a theft loss deduction due to a Ponzi-type investment scheme and are using Revenue Procedure 2009-20, as modified by Revenue Procedure 2011-58. Taxact 2007 Section C of Form 4684 replaces Appendix A in Revenue Procedure 2009-20. Taxact 2007 You do not need to complete Appendix A. Taxact 2007 For details, see Losses from Ponzi-type investment schemes , later. Taxact 2007 Reminders Future developments. Taxact 2007   For the latest information about developments related to Publication 547, such as legislation enacted after it was published, go to www. Taxact 2007 irs. Taxact 2007 gov/pub547. Taxact 2007 Photographs of missing children. Taxact 2007  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Taxact 2007 Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Taxact 2007 You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Taxact 2007 Introduction This publication explains the tax treatment of casualties, thefts, and losses on deposits. Taxact 2007 A casualty occurs when your property is damaged as a result of a disaster such as a storm, fire, car accident, or similar event. Taxact 2007 A theft occurs when someone steals your property. Taxact 2007 A loss on deposits occurs when your financial institution becomes insolvent or bankrupt. Taxact 2007 This publication discusses the following topics. Taxact 2007 Definitions of a casualty, theft, and loss on deposits. Taxact 2007 How to figure the amount of your gain or loss. Taxact 2007 How to treat insurance and other reimbursements you receive. Taxact 2007 The deduction limits. Taxact 2007 When and how to report a casualty or theft. Taxact 2007 The special rules for disaster area losses. Taxact 2007 Forms to file. Taxact 2007   Generally, when you have a casualty or theft, you have to file Form 4684. Taxact 2007 You may also have to file one or more of the following forms. Taxact 2007 Schedule A (Form 1040). Taxact 2007 Form 1040NR, Schedule A (for nonresident aliens). Taxact 2007 Schedule D. Taxact 2007 Form 4797. Taxact 2007 For details on which form to use, see How To Report Gains and Losses , later. Taxact 2007 Condemnations. Taxact 2007   For information on condemnations of property, see Involuntary Conversions in chapter 1 of Publication 544, Sales and Other Dispositions of Assets. Taxact 2007 Workbooks for casualties and thefts. Taxact 2007   Publication 584, Casualty, Disaster, and Theft Loss Workbook (Personal-Use Property), is available to help you make a list of your stolen or damaged personal-use property and figure your loss. Taxact 2007 It includes schedules to help you figure the loss on your home and its contents, and your motor vehicles. Taxact 2007   Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook, is available to help you make a list of your stolen or damaged business or income-producing property and figure your loss. Taxact 2007 Comments and suggestions. Taxact 2007   We welcome your comments about this publication and your suggestions for future editions. Taxact 2007   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Taxact 2007 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Taxact 2007 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Taxact 2007   You can send your comments from www. Taxact 2007 irs. Taxact 2007 gov/formspubs/. Taxact 2007 Click on “More Information” and then on “Comment on Tax Forms and Publications”. Taxact 2007   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Taxact 2007 Ordering forms and publications. Taxact 2007   Visit www. Taxact 2007 irs. Taxact 2007 gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Taxact 2007 Internal Revenue Service 1201 N. Taxact 2007 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Taxact 2007   If you have a tax question, check the information available on IRS. Taxact 2007 gov or call 1-800-829-1040. Taxact 2007 We cannot answer tax questions sent to either of the above addresses. Taxact 2007 Useful Items - You may want to see: Publication 523 Selling Your Home 525 Taxable and Nontaxable Income 550 Investment Income and Expenses 551 Basis of Assets 584 Casualty, Disaster, and Theft Loss Workbook (Personal-Use Property) 584-B Business Casualty, Disaster, and   Theft Loss Workbook Form (and Instructions) Schedule A (Form 1040) Itemized Deductions Form 1040NR, Schedule A Itemized Deductions (for nonresident aliens) Schedule D (Form 1040) Capital Gains and Losses 4684 Casualties and Thefts 4797 Sales of Business Property See How To Get Tax Help near the end of this publication for information about getting publications and forms. Taxact 2007 Prev  Up  Next   Home   More Online Publications
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SOI Tax Stats - Estate, Gift and Trust Statistics

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The studies in this section relate to the Federal Transfer tax system (estate and gift taxes) and to trusts, which are an integral part of many estate plans.

Estate Tax Statistics

Estate Tax Statistics OneSheet

This annual study includes information on gross estate and its composition, deductions, and tax, as well as information on the age, sex, and marital status of decedents. Estate tax data are produced by filing year and selected years of death. Data are compiled from Form 706.

Gift Tax

Snapshot of Gift Tax Statistics

This study includes information on gifts to individuals and charities that exceed the annual exclusion. Data are collected for the donor of the gift, the amount of each individual gift reported, the computation of lifetime gifts, and calculation of tax liability. Data are compiled from Form 709.

Income from
Trusts & Estates

Snapshot of Income from Trusts and Estates (Form 1041)

These population data, derived from IRS Master File data, include information on income, deductions, and tax liability reported for estates and domestic trusts. Information on Foreign Trusts is also available. Data are compiled from Form 1041.

Nonresident Alien
Estate Tax

Snapshot of Nonresident Alien Estate Tax

Provides data on estate tax returns filed for non-U.S. citizens who owned at least $60,000 worth of property within the U.S. at time of death. Data are classified by tax status and size of U.S. gross estate. This study is conducted annually and data are compiled from Form 706NA.

Personal Wealth

This periodic study provides estimates of personal wealth of top wealth holders that are generated from estate tax return data using the "estate multiplier" technique, in conjunction with both filing-year and year-of-death estate databases.

Split Interest Trusts

Snapshot of Split Interest Data

Split-interest trusts make distributions to both charitable and non-charitable beneficiaries, while providing tax benefits to their donors. Based on the method and timing of distributions, split-interest trusts are divided into four categories: charitable remainder annuity trusts, charitable remainder unitrusts, charitable lead trusts, and pooled income funds. Data are compiled from Form 5227.

 

Estate and Gift Tax Archive

 

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Page Last Reviewed or Updated: 27-Jan-2014

The Taxact 2007

Taxact 2007 10. Taxact 2007   Self-Employment (SE) Tax Table of Contents Who Must Pay SE Tax?Special Rules and Exceptions Figuring Earnings Subject to SE Tax Farm Optional Method Using Both Optional Methods Reporting Self-Employment Tax The SE tax rules apply no matter how old you are and even if you are already receiving social security and Medicare benefits. Taxact 2007 Who Must Pay SE Tax? Generally, you must pay SE tax and file Schedule SE (Form 1040) if your net earnings from self-employment were $400 or more. Taxact 2007 Use Schedule SE to figure net earnings from self-employment. Taxact 2007 Sole proprietor or independent contractor. Taxact 2007   If you are self-employed as a sole proprietor or independent contractor, you generally use Schedule C or C-EZ (Form 1040) to figure your earnings subject to SE tax. Taxact 2007 SE tax rate. Taxact 2007    For 2013, the SE tax rate on net earnings is 15. Taxact 2007 3% (12. Taxact 2007 4% social security tax plus 2. Taxact 2007 9% Medicare tax). Taxact 2007 Maximum earnings subject to self-employment tax. Taxact 2007    Only the first $113,700 of your combined wages, tips, and net earnings in 2013 is subject to any combination of the 12. Taxact 2007 4% social security part of SE tax, social security tax, or railroad retirement (tier 1) tax. Taxact 2007   All of your combined wages, tips, and net earnings in 2013 are subject to any combination of the 2. Taxact 2007 9% Medicare part of SE tax, social security tax, or railroad retirement (tier 1) tax. Taxact 2007   If your wages and tips are subject to either social security or railroad retirement (tier 1) tax, or both, and total at least $113,700, do not pay the 12. Taxact 2007 4% social security part of the SE tax on any of your net earnings. Taxact 2007 However, you must pay the 2. Taxact 2007 9% Medicare part of the SE tax on all your net earnings. Taxact 2007 Special Rules and Exceptions Aliens. Taxact 2007   Generally, resident aliens must pay self-employment tax under the same rules that apply to U. Taxact 2007 S. Taxact 2007 citizens. Taxact 2007 Nonresident aliens are not subject to SE tax unless an international social security agreement in effect determines that they are covered under the U. Taxact 2007 S. Taxact 2007 social security system. Taxact 2007 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. Taxact 2007 S. Taxact 2007 residents for self-employment tax purposes. Taxact 2007 For more information on aliens, see Publication 519, U. Taxact 2007 S. Taxact 2007 Tax Guide for Aliens. Taxact 2007 Child employed by parent. Taxact 2007   You are not subject to SE tax if you are under age 18 and you are working for your father or mother. Taxact 2007 Church employee. Taxact 2007    If you work for a church or a qualified church-controlled organization (other than as a minister or member of a religious order) that elected an exemption from social security and Medicare taxes, you are subject to SE tax if you receive $108. Taxact 2007 28 or more in wages from the church or organization. Taxact 2007 For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. Taxact 2007 Fishing crew member. Taxact 2007   If you are a member of the crew on a boat that catches fish or other water life, your earnings are subject to SE tax if all the following conditions apply. Taxact 2007 You do not get any pay for the work except your share of the catch or a share of the proceeds from the sale of the catch, unless the pay meets all the following conditions. Taxact 2007 The pay is not more than $100 per trip. Taxact 2007 The pay is received only if there is a minimum catch. Taxact 2007 The pay is solely for additional duties (such as mate, engineer, or cook) for which additional cash pay is traditional in the fishing industry. Taxact 2007 You get a share of the catch or a share of the proceeds from the sale of the catch. Taxact 2007 Your share depends on the amount of the catch. Taxact 2007 The boat's operating crew normally numbers fewer than 10 individuals. Taxact 2007 (An operating crew is considered as normally made up of fewer than 10 if the average size of the crew on trips made during the last four calendar quarters is fewer than 10. Taxact 2007 ) Notary public. Taxact 2007   Fees you receive for services you perform as a notary public are reported on Schedule C or C-EZ but are not subject to self-employment tax (see the Instructions for Schedule SE (Form 1040)). Taxact 2007 State or local government employee. Taxact 2007   You are subject to SE tax if you are an employee of a state or local government, are paid solely on a fee basis, and your services are not covered under a federal-state social security agreement. Taxact 2007 Foreign government or international organization employee. Taxact 2007   You are subject to SE tax if both the following conditions are true. Taxact 2007 You are a U. Taxact 2007 S. Taxact 2007 citizen employed in the United States, Puerto Rico, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, or the Virgin Islands by: A foreign government, A wholly-owned agency of a foreign government, or An international organization. Taxact 2007 Your employer is not required to withhold social security and Medicare taxes from your wages. Taxact 2007 U. Taxact 2007 S. Taxact 2007 citizen or resident alien residing abroad. Taxact 2007    If you are a self-employed U. Taxact 2007 S. Taxact 2007 citizen or resident alien living outside the United States, in most cases you must pay SE tax. Taxact 2007 Do not reduce your foreign earnings from self-employment by your foreign earned income exclusion. Taxact 2007 Exception. Taxact 2007    The United States has social security agreements with many countries to eliminate double taxation under two social security systems. Taxact 2007 Under these agreements, you generally must only pay social security and Medicare taxes to the country in which you live. Taxact 2007 The country to which you must pay the tax will issue a certificate which serves as proof of exemption from social security tax in the other country. Taxact 2007   For more information, see the Instructions for Schedule SE (Form 1040). Taxact 2007 More Than One Business If you have earnings subject to SE tax from more than one trade, business, or profession, you must combine the net profit (or loss) from each to determine your total earnings subject to SE tax. Taxact 2007 A loss from one business reduces your profit from another business. Taxact 2007 Community Property Income If any of the income from a trade or business, other than a partnership, is community property income under state law, it is included in the earnings subject to SE tax of the spouse carrying on the trade or business. Taxact 2007 Gain or Loss Do not include in earnings subject to SE tax a gain or loss from the disposition of property that is neither stock in trade nor held primarily for sale to customers. Taxact 2007 It does not matter whether the disposition is a sale, exchange, or an involuntary conversion. Taxact 2007 Lost Income Payments If you are self-employed and reduce or stop your business activities, any payment you receive from insurance or other sources for the lost business income is included in earnings subject to SE tax. Taxact 2007 If you are not working when you receive the payment, it still relates to your business and is included in earnings subject to SE tax, even though your business is temporarily inactive. Taxact 2007 Figuring Earnings Subject to SE Tax Methods for Figuring Net Earnings There are three ways to figure your net earnings from self-employment. Taxact 2007 The regular method. Taxact 2007 The nonfarm optional method. Taxact 2007 The farm optional method. Taxact 2007 You must use the regular method unless you are eligible to use one or both of the optional methods. Taxact 2007 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. Taxact 2007 You want to receive credit for social security benefit coverage. Taxact 2007 You incurred child or dependent care expenses for which you could claim a credit. Taxact 2007 (An optional method may increase your earned income, which could increase your credit. Taxact 2007 ) You are entitled to the earned income credit. Taxact 2007 (An optional method may increase your earned income, which could increase your credit. Taxact 2007 ) You are entitled to the additional child tax credit. Taxact 2007 (An optional method may increase your earned income, which could increase your credit. Taxact 2007 ) Effects of using an optional method. Taxact 2007   Using an optional method could increase your SE tax. Taxact 2007 Paying more SE tax could result in your getting higher benefits when you retire. Taxact 2007   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 tax or no tax using the regular method. Taxact 2007   The optional methods may be used only to figure your SE tax. Taxact 2007 To figure your income tax, include your actual earnings in gross income, regardless of which method you use to determine SE tax. Taxact 2007 Regular Method Multiply your total earnings subject to SE tax by 92. Taxact 2007 35% (. Taxact 2007 9235) to get your net earnings under the regular method. Taxact 2007 See Short Schedule SE, line 4, or Long Schedule SE, line 4a. Taxact 2007 Net earnings figured using the regular method are also called actual net earnings. Taxact 2007 Nonfarm Optional Method Use the nonfarm optional method only for earnings that do not come from farming. Taxact 2007 You may use this method if you meet all the following tests. Taxact 2007 You are self-employed on a regular basis. Taxact 2007 This means that your actual net earnings from self-employment were $400 or more in at least 2 of the 3 tax years before the one for which you use this method. Taxact 2007 The net earnings can be from either farm or nonfarm earnings or both. Taxact 2007 You have used this method less than 5 years. Taxact 2007 (There is a 5-year lifetime limit. Taxact 2007 ) The years do not have to be one after another. Taxact 2007 Your net nonfarm profits were: Less than $5,024, and Less than 72. Taxact 2007 189% of your gross nonfarm income. Taxact 2007 Net nonfarm profits. Taxact 2007   Net nonfarm profit generally is the total of the amounts from: Line 31, Schedule C (Form 1040), Line 3, Schedule C-EZ (Form 1040), Box 14, code A, Schedule K-1 (Form 1065) (from nonfarm partnerships), and Box 9, code J1, Schedule K-1 (Form 1065-B). Taxact 2007   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. Taxact 2007 Gross nonfarm income. Taxact 2007   Your gross nonfarm income generally is the total of the amounts from: Line 7, Schedule C (Form 1040), Line 1, Schedule C-EZ (Form 1040), Box 14, code C, Schedule K-1 (Form 1065) (from nonfarm partnerships), and Box 9, code J2, Schedule K-1 (Form 1065-B). Taxact 2007 Figuring Nonfarm Net Earnings If you meet the three tests explained earlier, use the following table to figure your net earnings from self-employment under the nonfarm optional method. Taxact 2007 Table 10-1. Taxact 2007 Figuring Nonfarm Net Earnings IF your gross nonfarm income is. Taxact 2007 . Taxact 2007 . Taxact 2007 THEN your net earnings are equal to. Taxact 2007 . Taxact 2007 . Taxact 2007 $6,960 or less Two-thirds of your gross nonfarm income. Taxact 2007 More than $6,960 $4,640 Actual net earnings. Taxact 2007   Your actual net earnings are 92. Taxact 2007 35% of your total earnings subject to SE tax (that is, multiply total earnings subject to SE tax by 92. Taxact 2007 35% (. Taxact 2007 9235) to get actual net earnings). Taxact 2007 Actual net earnings are equivalent to net earnings figured using the regular method. Taxact 2007 Optional net earnings less than actual net earnings. Taxact 2007   You cannot use this method to report an amount less than your actual net earnings from self-employment. Taxact 2007 Gross nonfarm income of $6,960 or less. Taxact 2007   The following examples illustrate how to figure net earnings when gross nonfarm income is $6,960 or less. Taxact 2007 Example 1. Taxact 2007 Net nonfarm profit less than $5,024 and less than 72. Taxact 2007 189% of gross nonfarm income. Taxact 2007 Ann Green runs a craft business. Taxact 2007 Her actual net earnings from self-employment were $800 in 2011 and $900 in 2012. Taxact 2007 She meets the test for being self-employed on a regular basis. Taxact 2007 She has used the nonfarm optional method less than 5 years. Taxact 2007 Her gross income and net profit in 2013 are as follows: Gross nonfarm income $5,400 Net nonfarm profit $1,200 Ann's actual net earnings for 2013 are $1,108 ($1,200 × . Taxact 2007 9235). Taxact 2007 Because her net profit is less than $5,024 and less than 72. Taxact 2007 189% of her gross income, she can use the nonfarm optional method to figure net earnings of $3,600 (2/3 × $5,400). Taxact 2007 Because these net earnings are higher than her actual net earnings, she can report net earnings of $3,600 for 2013. Taxact 2007 Example 2. Taxact 2007 Net nonfarm profit less than $5,024 but not less than 72. Taxact 2007 189% of gross nonfarm income. Taxact 2007 Assume that in Example 1 Ann's gross income is $1,000 and her net profit is $800. Taxact 2007 She must use the regular method to figure her net earnings. Taxact 2007 She cannot use the nonfarm optional method because her net profit is not less than 72. Taxact 2007 189% of her gross income. Taxact 2007 Example 3. Taxact 2007 Net loss from a nonfarm business. Taxact 2007 Assume that in Example 1 Ann has a net loss of $700. Taxact 2007 She can use the nonfarm optional method and report $3,600 (2/3 × $5,400) as her net earnings. Taxact 2007 Example 4. Taxact 2007 Nonfarm net earnings less than $400. Taxact 2007 Assume that in Example 1 Ann has gross income of $525 and a net profit of $175. Taxact 2007 In this situation, she would not pay any SE tax under either the regular method or the nonfarm optional method because her net earnings under both methods are less than $400. Taxact 2007 Gross nonfarm income of more than $6,960. Taxact 2007   The following examples illustrate how to figure net earnings when gross nonfarm income is more than $6,960. Taxact 2007 Example 1. Taxact 2007 Net nonfarm profit less than $5,024 and less than 72. Taxact 2007 189% of gross nonfarm income. Taxact 2007 John White runs an appliance repair shop. Taxact 2007 His actual net earnings from self-employment were $10,500 in 2011 and $9,500 in 2012. Taxact 2007 He meets the test for being self-employed on a regular basis. Taxact 2007 He has used the nonfarm optional method less than 5 years. Taxact 2007 His gross income and net profit in 2013 are as follows: Gross nonfarm income $12,000 Net nonfarm profit $1,200 John's actual net earnings for 2013 are $1,108 ($1,200 × . Taxact 2007 9235). Taxact 2007 Because his net profit is less than $5,024 and less than 72. Taxact 2007 189% of his gross income, he can use the nonfarm optional method to figure net earnings of $4,640. Taxact 2007 Because these net earnings are higher than his actual net earnings, he can report net earnings of $4,640 for 2013. Taxact 2007 Example 2. Taxact 2007 Net nonfarm profit not less than $5,024. Taxact 2007 Assume that in Example 1 John's net profit is $5,400. Taxact 2007 He must use the regular method. Taxact 2007 He cannot use the nonfarm optional method because his net nonfarm profit is not less than $5,024. Taxact 2007 Example 3. Taxact 2007 Net loss from a nonfarm business. Taxact 2007 Assume that in Example 1 John has a net loss of $700. Taxact 2007 He can use the nonfarm optional method and report $4,640 as his net earnings from self-employment. Taxact 2007 Farm Optional Method Use the farm optional method only for earnings from a farming business. Taxact 2007 See Publication 225 for information about this method. Taxact 2007 Using Both Optional Methods If you have both farm and nonfarm earnings, you may be able to use both optional methods to determine your net earnings from self-employment. Taxact 2007 To figure your net earnings using both optional methods, you must: Figure your farm and nonfarm net earnings separately under each method. Taxact 2007 Do not combine farm earnings with nonfarm earnings to figure your net earnings under either method. Taxact 2007 Add the net earnings figured under each method to arrive at your total net earnings from self-employment. Taxact 2007 You can report less than your total actual farm and nonfarm net earnings but not less than actual nonfarm net earnings. Taxact 2007 If you use both optional methods, you can report no more than $4,640 as your combined net earnings from self-employment. Taxact 2007 Example. Taxact 2007 You are a self-employed farmer. Taxact 2007 You also operate a retail grocery store. Taxact 2007 Your gross income, actual net earnings from self-employment, and optional farm and optional nonfarm net earnings from self-employment are shown in Table 10-2. Taxact 2007 Table 10-2. Taxact 2007 Example—Farm and Nonfarm Earnings Income and Earnings Farm Nonfarm Gross income $3,000 $6,000 Actual net earnings $900 $500 Optional net earnings (2/3 of gross income) $2,000 $4,000 Table 10-3 shows four methods or combinations of methods you can use to figure net earnings from self-employment using the farm and nonfarm gross income and actual net earnings shown in Table 10-2. Taxact 2007 Method 1. Taxact 2007 Using the regular method for both farm and nonfarm income. Taxact 2007 Method 2. Taxact 2007 Using the optional method for farm income and the regular method for nonfarm income. Taxact 2007 Method 3. Taxact 2007 Using the regular method for farm income and the optional method for nonfarm income. Taxact 2007 Method 4. Taxact 2007 Using the optional method for both farm and nonfarm income. Taxact 2007 Note. Taxact 2007 Actual net earnings is the same as net earnings figured using the regular method. Taxact 2007 Table 10-3. Taxact 2007 Example—Net Earnings Net Earnings 1 2 3 4 Actual  farm $ 900   $ 900   Optional  farm   $ 2,000   $ 2,000 Actual nonfarm $ 500 $ 500     Optional nonfarm     $4,000 $4,000 Amount you can report: $1,400 $2,500 $4,900 $4,640* *Limited to $4,640 because you used both optional methods. Taxact 2007 Fiscal Year Filer If you use a tax year other than the calendar year, you must use the tax rate and maximum earnings limit in effect at the beginning of your tax year. Taxact 2007 Even if the tax rate or maximum earnings limit changes during your tax year, continue to use the same rate and limit throughout your tax year. Taxact 2007 Reporting Self-Employment Tax Use Schedule SE (Form 1040) to figure and report your SE tax. Taxact 2007 Then enter the SE tax on line 56 of Form 1040 and attach Schedule SE to Form 1040. Taxact 2007 Most taxpayers can use Section A—Short Schedule SE to figure their SE tax. Taxact 2007 However, certain taxpayers must use Section B—Long Schedule SE. Taxact 2007 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. Taxact 2007 Joint return. Taxact 2007   Even if you file a joint return, you cannot file a joint Schedule SE. Taxact 2007 This is true whether one spouse or both spouses have earnings subject to SE tax. Taxact 2007 If both of you have earnings subject to SE tax, each of you must complete a separate Schedule SE. Taxact 2007 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. Taxact 2007 Attach both schedules to the joint return. Taxact 2007 More than one business. Taxact 2007   If you have more than one trade or business, you must combine the net profit (or loss) from each business to figure your SE tax. Taxact 2007 A loss from one business will reduce your profit from another business. Taxact 2007 File one Schedule SE showing the earnings from self-employment, but file a separate Schedule C, C-EZ, or F for each business. Taxact 2007 Example. Taxact 2007 You are the sole proprietor of two separate businesses. Taxact 2007 You operate a restaurant that made a net profit of $25,000. Taxact 2007 You also have a cabinetmaking business that had a net loss of $500. Taxact 2007 You must file a Schedule C for the restaurant showing your net profit of $25,000 and another Schedule C for the cabinetmaking business showing your net loss of $500. Taxact 2007 You file Schedule SE showing total earnings subject to SE tax of $24,500. Taxact 2007 Prev  Up  Next   Home   More Online Publications