Income of $5900 (less than personal exemption) and TT form says 0 taxable income, yet it comes up owing $707 in Fed tax and $354 in state tax?

[BillM223 · Accepted solution]

Are you self-employed? Taxpayers who file Schedule C for a sole proprietorship must pay self-employment taxes if the Schedule C shows a profit.

Look for line 4 on Schedule 2 (1040). If there is an amount here, then this is how you can owe tax in this situation.

Remember, the Standard Deduction applies only to income tax, not self-employment taxes.