Schedule SE: filling in the self-employment tax form for 2026
Schedule SE turns the bottom line of your business into Social Security and Medicare tax; here is what each part of it does with your numbers.
Self-employment tax for 2026
$9,891
Half of the 15.3% part, $4,945, comes off your income
| Net earnings (92.35% of profit) | $64,645 |
| Social Security 12.4% on $64,645 | $8,016 |
| Medicare 2.9% on all of it | $1,875 |
| Additional Medicare 0.9% | $0 |
| Social Security wage base | $184,500 |
Computed by Radif Partners from IRS documents for tax year 2026 · How we calculate · no email asked, nothing sold
Schedule SE is the page of Form 1040 that computes self-employment tax. You file it when net earnings on line 4c reach $400, or when you had church employee income above a small separate threshold. Line 2 takes the net profit from Schedule C, line 31, line 4a multiplies it by 92.35%, and the tax is 12.4 % for Social Security on the part of net earnings under $184,500 for 2026 plus 2.9 % for Medicare on all of it. W-2 wages that already carried Social Security tax go on line 8a and shrink the room under the cap. With $70,000 of profit and no job, the form ends at $9,891 of SE tax, carried to Schedule 2, and a deduction of $4,945 that goes to Schedule 1, line 15. Spouses with their own business income each file a separate Schedule SE; one person with several businesses combines them on a single form.
The calculator above follows Schedule SE in order: profit in, net earnings at 92.35%, Social Security up to the base, Medicare on everything, then the half that comes off your income. Enter the profit from all your businesses together and any W-2 wages, and each line of the form shows on the result card. The figures below use the line numbers of the current form as described in the IRS instructions for Schedule SE.
From receipts to line 31
Net profit (line 31)
$58,000
| SE tax on it | $8,195 |
| Expense ratio | 17.1% |
Who has to file it
The trigger is net earnings, not gross receipts. If line 4c, which is your profit after the 92.35% step, comes to $400 or more, the form is required. A business that billed a lot but ended with a loss does not file it, unless you choose an optional method described below. Two exceptions stand apart. Church employees whose employer opted out of Social Security owe the tax on wages of $108.28 or more, reported on line 5a. Ministers and members of certain religious sects who received IRS approval of Form 4361 or Form 4029 may not need to file it at all.
Several businesses, one form
If you run two activities, a design studio and a weekend photography business for instance, their profits and losses are added on one Schedule SE. A loss in one reduces the earnings from the other. Married couples filing jointly are the opposite case: each spouse with self-employment income files a separate Schedule SE, because each has their own Social Security record.
Part I, line by line
Lines 1a and 1b concern farm income and conservation payments. Most contractors start at line 2, where the net profit from Schedule C, line 31 goes; partners enter the amount from box 14, code A of their K-1. Line 3 adds these together. Line 4a multiplies line 3 by 92.35%, the step that treats you like an employee whose employer's half is not part of pay. If that result is under $400, you stop.
| Line | What goes there | No job | With $140,000 of wages |
|---|---|---|---|
| Line 2 | Net profit from Schedule C, line 31 | $70,000 | $70,000 |
| Line 4a | 92.35% of line 3 | $64,645 | $64,645 |
| Line 8a | W-2 wages already taxed for Social Security | $0 | $140,000 |
| Social Security part | 12.4 % of the earnings left under $184,500 | $8,016 | $5,518 |
| Medicare part | 2.9 % of line 4a | $1,875 | $1,875 |
| SE tax | to Schedule 2, line 4 | $9,891 | $7,393 |
| Deduction | half of the SE tax, to Schedule 1, line 15 | $4,945 | $3,696 |
The wage column shows why line 8a matters. A job paying $140,000 leaves only $44,500 of room under the $184,500 base, so the Social Security part falls to $5,518 while Medicare stays at $1,875. Leaving wages off line 8a overstates the tax. Statutory employees, whose W-2 has box 13 checked, report their Schedule C profit for income tax but leave it off Schedule SE, because Social Security was already withheld.
The deduction at the bottom
Part I ends with half of the tax. That amount moves to Schedule 1, line 15, where it lowers adjusted gross income whether or not you itemize. It does not lower the SE tax itself and does not change line 4a. In the example, $4,945 comes off income, which at the 12 % bracket saves about $593 of income tax. The self-employment tax rate page explains why the rate stands at 15.3 %.
The Additional Medicare Tax is not on this form
Schedule SE stops at the regular 2.9 % Medicare tax. When the earnings on line 6, added to wages, pass $200,000 single, $250,000 joint or $125,000 separate, the extra 0.9 % is computed on Form 8959. Your wages reduce the threshold that applies to self-employment income (Form 8959 instructions).
Part II: the optional methods
Part II exists for people with a loss or a very small profit who want Social Security credit anyway, or whose earned income credit, additional child tax credit or child care credit would rise with higher earnings. Under the nonfarm optional method you may report two-thirds of gross nonfarm income as net earnings, within a yearly dollar cap printed in the instructions. You must be regularly self-employed, meaning actual net earnings of $400 or more in two of the three prior years, and the method can be used for five years in a lifetime. It can increase your SE tax, and you may switch back later on an amended return. Farmers have a parallel farm optional method.
Errors that change the result
Three slips come up again and again. The first is entering gross receipts instead of the Schedule C net profit on line 2, which taxes your expenses. The second is forgetting line 8a when a job already paid Social Security tax, so the form charges 12.4 % twice on the same slice of the base. The third is filing one Schedule SE for a couple when both spouses had business income, which merges two earnings records and can put the combined amount over the cap. Software usually catches the first one; the other two depend on what you type.
What does not belong on Schedule SE
Several kinds of income stay off the form: rent from real estate when you are not a dealer, dividends and interest unrelated to the business, gains on selling property that is not inventory, and notary fees. If notary work is your only self-employment, you do not file the form. The net profit itself is built on Schedule C, so every deduction you claim there lowers line 2 here. The full yearly bill, with income tax, is in the 1099 tax calculator.