Self Employment Tax Liability

[Cookman326]

I began collecting my social security benefits at my full retirement age in 2022 with no reduction in benefits.  In 2022, I became an independent contractor and received a 1099NEC for $69,000.  My self-employment tax liability for 2022 was computed by Turbo Tax as $5,900.  My question is:  Must I pay the self employment tax if I am already collecting my full Social Security retirement benefit?  If so, is there any way to reduce the amount due?

[VolvoGirl]

Sorry yes.  Paying self employment tax might increase your SS benefits.  The only way to reduce your Net Profit and SE tax is to enter more business expenses.  

[KrisD15]

Yes, you must pay it.

Self-Employment tax is your FICA which is taxed regardless of your age or retirement status. 

No, it is based on the profit of the business if filing Schedule C. 

You might talk with a CPA to explore the option and any of any advantages of changing the business entity to a Corporation.

@Cookman326 

[Cookman326]

Thanks for the clarification.

[Cookman326]

Thank you.  I thought so, but I just wanted to make sure.