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Summary Table for Optional Methods of Computing Non-Farm Self-Employment Income

Excerpted from "Social Security Handbook". See the up-to-date, official Social Security Handbook at ssa.gov.

1243. Summary Table for Optional Methods of Computing Non-Farm Self-Employment Income

The following table summarizes the effect of the optional method of computing the amount of self-employment income from a non-farm business to be reported for taxable years beginning after 1972:


Optional Method: Non-Farm Self-Employment Income

If the gross farm income is...

And the net farm profit is...

Then the self-employment income to be reported is:

Regular method

Optional method

Under $600

Under $400

None

None

Under $600

$400 to $500

Actual net

Actual net*

$600 to $2,400

Under $400

None

Two-thirds of gross

$600 to $2,400

$400 to $1,599

Actual net

Two-thirds of gross

$600 to $2,400

$1,600 to $2,400

Actual net

Actual net*

More than $2,400

Under $400

None

$1,600

More than $2,400

$400 to 1,599

Actual net

$1,600

More than $2,400

$1,600 and over

Actual net

Actual net*

* Option cannot be used because an individual using the non-farm option may not declare less than actual net earnings from self-employment.

Last Revised: March, 2001

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