1201. Self-Employment Income
1201.1 What is "self-employment income"?
Self-employment income means your net earnings from self-employment for a taxable year. The following qualifications must be met:
-
Your net earnings for the taxable year must be at least $400;
Note: Certain church employees who are treated as self-employed must report earnings of $100 or more (see §1136). See §§1233-1235and §§1241-1244 about the optional methods of computing net earnings.
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Your trade or business must be covered by Social Security; and
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If you are a nonresident alien, your earnings are not considered self-employment income except as provided by an international agreement (see§ 107).
1201.2 What are the limits on self-employed income?
Self-employment income cannot exceed the amounts listed in the table below. Any wages covered by Social Security that you earned during the taxable year must be subtracted from the limits shown below.
|
If the taxable year is... |
Then your self-employment income limit is... |
|---|---|
|
1951-1954 |
$3,600 |
|
1955-1958 |
$4,200 |
|
1959-1965 |
$4,800 |
|
1966-1967 |
$6,600 |
|
1968-1971 |
$7,800 |
|
1972 |
$9,000 |
|
1973 |
$10,00 |
|
1974 |
$13,200 |
|
1975 |
$14,100 |
|
1976 |
$15,300 |
|
1977 |
$16,500 |
|
1978 |
$17,700 |
|
1979 |
$22,900 |
|
1980 |
$25,900 |
|
1981 |
$29,700 |
|
1982 |
$32,400 |
|
1983 |
$35,700 |
|
1984 |
$37,800 |
|
1985 |
$39,600 |
|
1986 |
$42,000 |
|
1987 |
$43,800 |
|
1988 |
$45,000 |
|
1989 |
$48,000 |
|
1990 |
$51,300 |
|
1991 |
$53,400 |
|
1992 |
$55,500 |
|
1993 |
$57,600 |
|
1994 |
$60,600 |
|
1995 |
$61,200 |
|
1996 |
$62,700 |
|
1997 |
$65,400 |
|
1998 |
$68,400 |
|
1999 |
$72,600 |
|
2000 |
$76,200 |
|
2001 |
$80,400 |
|
2002 |
$84,900 |
|
2003 |
$87,000 |
|
2004 |
$87,900 |
|
2005 |
$90,000 |
|
2006 |
$94,200 |
|
2007 |
$97,500 |
1201.3 What are the limits beginning in 1998?
Amounts for taxable years beginning in 1998 are subject to automatic increases in multiples of $300, if average total wages rise enough to cause a cost-of-living increase in benefits.
1201.4 Where is the amount for the current year published?
The amount for a taxable year is published in the Federal Register on or before November 1, of the year immediately preceding that taxable year.
1201.5 Are net earnings from self-employment and self-employment income the same?
Net earnings from self-employment and self-employment income are not the same. Only that part of net earnings that is included in the term "self-employment income" is subject to Social Security self-employment taxes and counted for Social Security benefit purposes. (However, even if net earnings do not count for these purposes, they are included in figuring the amount of benefits that must be withheld under the earnings test. See Chapter 18.)
Last Revised: Jan. 25, 2007