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You’re basically correct.

You can include the $1,267 Massachusetts-allocated self-employment tax in line 11 of your 2021 Form 1 Massachusetts Resident Income Tax Return.  And, yes, the 2.9% for Medicare counts, as well.  (Up to the $2,000 maximum noted in the Line 11 instructions in the 2021 Form 1 Instructions.) 

The only minor correction I’d make to your assessment is that you’re claiming a deduction here, not a credit.  A deduction offsets taxable income; a credit directly offsets tax, itself.

As for receiving Earned Income Credit, that’s a non-issue, and has nothing to do with your self-employment calculations.

 

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