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I received a letter from IRS saying I owed self employment tax on other income. I reported the income on line 21. Didn't it figure that tax when I filed?

 
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4 Replies

I received a letter from IRS saying I owed self employment tax on other income. I reported the income on line 21. Didn't it figure that tax when I filed?

No.  You have to file it on schedule C to calculate the self employment tax on it.  It should show up on 1040 line 12 for business income not line 21 other income.

I received a letter from IRS saying I owed self employment tax on other income. I reported the income on line 21. Didn't it figure that tax when I filed?

It's not our business. It was extra income my husband earned helping a sports organization. That's why I put it on line 21

I received a letter from IRS saying I owed self employment tax on other income. I reported the income on line 21. Didn't it figure that tax when I filed?

Did he get a 1099Misc for it?  And the amount in box 7?  That is self employment income and is business income for him.  He doesn't have to have an official business set up.  You are considered to have your own business for it.  YOU are the business.
Hal_Al
Level 15

I received a letter from IRS saying I owed self employment tax on other income. I reported the income on line 21. Didn't it figure that tax when I filed?

Although it may be news to you that you “have a business” (and most of the other people who get their first 1099-MISC); The IRS considers anything in box 7 of 1099-MISC, for work performed, to be self employment income. Enter the 1099-Misc income, at Other Common income / income from a 1099-MISC . TurboTax (TT) will complete Schedule C or C-EZ for you and allow you to deduct any expenses associated with this income. You'll also have to pay self employment tax (social security & Medicare) on any profits greater than $400. These types of payments are frequently done this way. Your "employer" is not the only one. 

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