I work for myself. I have a question about how to report self-employment income. Is there a W-2 for self-employed individuals â€“ or is there some other form or forms that I should be using to report my self-employment income and pay my self-employment tax?
It is important to keep in mind that when you are self-employed you pay the same income tax as someone who works for an employer and earns a paycheck or wage working for said employer. The difference is not in the amount of income that is taxed, but in that when you are working for yourself, there is no employer who will automatically be withholding this tax with each paycheck. As a self-employed individual, the onus of setting aside the money will fall on you. Regarding how to report self-employment income, self-employment income isn’t reported on a W-2. There is no W-2 self-employed specific form that you can create. Instead, you must report your self-employment income on Schedule C (Form 1040) to report income or (loss) from any business you operated or profession you practiced as a sole proprietor in which you engaged for profit. You’ll figure your self-employment tax on Schedule SE. Schedule SE is required if your self-employment income minus expenses is at least $400.
If you are selling items at a farmer's market, learn how to file your taxes with H&R Block. From cash income to bartering, these tax tips will help.