It is the self-employment tax. One-half of the self-employment tax is removed from Earned Income. The self-employment tax (social security and Medicare tax) is an adjustment to Earned Income. If you have earnings subject to self-employment tax, use Schedule SE to figure your net earnings from self-employment.
Before you figure your net earnings, you generally need to figure your total earnings subject to self-employment tax. $4250 is her total earnings subject to SE tax - her net earnings are $3949.
She has a Sched SE and an Earned Inc Wks included in her return that shows the adjustment. The contribution limit is net earnings from self-employment.
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