Should self-employed income include the total amount collected (taxes included) or only the Net amount? Our 1099K from payment proc includes total amounts received.

you report gross as revenue. otherwise, you can expect a notice from the iRS. the deduction for the taxes you paid go on the line for taxes and any credit card fees would go under misc deductions

per schedule C instruction

You can deduct the following taxes and
licenses on this line.
• State and local sales taxes imposed on you as the seller of goods or services. If you collected this tax from the buyer, you must also include the amount collected in gross receipts or sales on line 1