| If your net earnings are more than
$400, and/or if you perform services for a church as an
employee and receive income of $108.28 or more, you must
pay
self-employment (SE) tax using
Form 1040, Schedule SE (PDF).
If you are self-employed, a sole
proprietor (someone who owns an unincorporated business
by yourself), or an independent contractor, you are
required to report income and expenses on
Schedule C (PDF) or
C-EZ (PDF) and
calculate your earnings (scroll down to Figuring
Earnings Subject to Self-Employment Tax) subject to SE
tax. Attach the schedule to your Form 1040, U.S.
Individual Income Tax Return.
If you are a member of a partnership
that carries on a trade or business, your distributive
share of its income or loss from the trade or business
is included in your net earnings from self-employment.
The partnership must report the business income and
expenses on Form 1065, U.S. Return of Partnership
Income, along with a Schedule K-1 showing each partner's
net income, and file Schedule SE (Form 1040) to report
your individual SE tax.
If you have employees, you must pay
employment taxes, including Federal income, Social
Security, and Medicare taxes.
If you manufacture or sell certain
products, operate certain kinds of businesses, use
various kinds of equipment, facilities, or products, or
receive payment for certain services, you may need to
pay excise taxes.
Estimated tax is the method used to
pay (including SE tax) on income not subject to
withholding. You generally have to make
estimated tax payments if you expect to owe taxes,
including self-employment tax, of $1,000 or more when
you file your return. Use
Form 1040-ES (PDF) to figure and pay the tax.
2004 Tax Filing Requirements
| Single |
under 65 |
$7,950 |
| 65 or older |
$9,150 |
|
| Head of household |
under 65 |
$10,250 |
| 65 or older |
$11,450 |
|
| Married, filing
jointly*** |
under 65 (both spouses) |
$15,900 |
| 65 or older (one spouse) |
$16,850 |
| 65 or older (both spouses) |
$17,800 |
|
| Married, filing separately |
any age |
$3,100 |
|
| Qualifying widow(er)
with dependent child |
under 65 |
$12,800 |
| 65 or older |
$13,750 |
|
*If you were born on January 1,
1940, you are considered to be age 65 at the end of 2004.
**Gross Income means all income you received in the form of
money, good, property, and services that is not exempt from tax,
including any income from sources outside the United States
(even if you may exclude all or part of it). Do not include
Social Security benefits unless you are married filing a
seperate return and you lived with your spouse at any time in
2004.
***If you did not live with your spouse at the end of 2004 (or
on the date your spouse died) and your gross income was at least
$3,100, you must file a return regardless of age. |
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