Which of the following statements regarding the self-employment tax is true? Income and expenses from self-employment...
Which of the following statements regarding the self-employment tax is true?
- Income and expenses from self-employment are reported on Schedule D (Form 1040).
- Self-employment income is subject to both Federal income tax and self-employment tax.
- One half of self-employment tax is deductible as an itemized deduction.
- All self-employment income is subject to both Medicare and Social Security tax.
Homework Answers
OPTION d: All self-employment income is subject to both Medicare and Social Security tax
EXPLANATION:
The self-employment tax rate is 15.3% which consists of two taxes: 12.4% for social security and 2.9% for Medicare.
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