Turbotax 2019 Home & Business - why does my Fed summary show no taxable income and also Fed tax due?

[sjg60]

"Federal Tax Summary"
total income                       $4516
standard deduction       $12519
taxable income                         $0
Federal taxes due                $638 Why?

[rjs · Accepted solution]

The $638 is self-employment tax. You do not owe any income tax, but you have to pay self-employment tax on your business income. They are two separate taxes. "Taxable income" means income that is subject to income tax. Self-employment tax is the equivalent of the Social Security and Medicare taxes that would be withheld from your pay if you were an employee instead of self-employed.

[DoninGA]

You had a net profit from your self-employment.  You owe self-employment taxes.

SE tax is a Social Security and Medicare tax primarily for individuals who work for themselves.

[sjg60]

Thank you rjs.  That sounds right, I guess I was a little confused because the "Fed tax Due" status box shows the $638 in red at the top of the screen on the program.  I'll finish the state and see how it all comes out.

[sjg60]

Thank you DoninGA.  That sounds right, I guess I was a little confused because the "Fed tax Due" status box shows the $638 in red at the top of the screen on the program.  I'll finish the state and see how it all comes out.