I have small lending business and have passive income from it, if I report it under "Self employment" income - Mortgage lending(Business code 999000) it will be offset by passive loses(K1) from prior year on tax form, but it will add "Self employment taxes" on 1040. If I report it under 'Miscellaneous Income' it will not add "Self employment taxes" on 1040, but will not be offset by passive losses.
Where should I report this income to be offset by passive loses from prior year and will not add "Self employment taxes"?
