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Taxact 2011 Free Federal Edition Download

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Taxact 2011 Free Federal Edition Download

Taxact 2011 free federal edition download 29. Taxact 2011 free federal edition download   Límite sobre Deducciones Detalladas Table of Contents Introduction Useful Items - You may want to see: ¿Está Usted Sujeto al Límite? ¿Qué Deducciones Detalladas Están Limitadas? ¿Qué Deducciones Detalladas no Están Limitadas? ¿Cómo se Calcula el Límite?Ejemplo Introduction Este capítulo trata del límite general sobre las deducciones detalladas en el Anexo A (Formulario 1040). Taxact 2011 free federal edition download Los temas abarcan: Quién está sujeto al límite. Taxact 2011 free federal edition download Qué deducciones detalladas están limitadas. Taxact 2011 free federal edition download Cómo calcular el límite. Taxact 2011 free federal edition download Useful Items - You may want to see: Formulario (e Instrucciones) Anexo A (Formulario 1040) Itemized Deductions (Deducciones detalladas), en inglés. Taxact 2011 free federal edition download ¿Está Usted Sujeto al Límite? Si tiene ingresos brutos ajustados (AGI, por sus siglas en inglés) de más de $300,000, si es casado que presenta la declaración conjunta o viudo calificado, $275,000, si es cabeza de familia, $250,000, si es soltero o $150,000, si es casado que presenta la declaración por separado, está sujeto al límite sobre determinadas deducciones detalladas. Taxact 2011 free federal edition download El ingreso bruto ajustado (AGI) es la cantidad de la línea 38 (Formulario 1040). Taxact 2011 free federal edition download ¿Qué Deducciones Detalladas Están Limitadas? Las siguientes deducciones del Anexo A (Formulario 1040) están sujetas al límite general sobre las deducciones detalladas: Impuestos pagados —línea 9. Taxact 2011 free federal edition download Intereses pagados —líneas 10,11,12 y 13. Taxact 2011 free federal edition download Donaciones a organizaciones caritativas —línea 19. Taxact 2011 free federal edition download Gastos laborales y determinadas deducciones misceláneas —línea 27. Taxact 2011 free federal edition download Otras deducciones misceláneas —línea 28, excluyendo pérdidas por apuestas y juegos de azar y por hecho fortuito o robo. Taxact 2011 free federal edition download ¿Qué Deducciones Detalladas no Están Limitadas? Las siguientes deducciones del Anexo A (Formulario 1040) no están sujetas al límite general sobre las deducciones detalladas. Taxact 2011 free federal edition download Sin embargo, igualmente están sujetas a otros límites aplicables. Taxact 2011 free federal edition download Gastos médicos y dentales —línea 4. Taxact 2011 free federal edition download Gastos de intereses de inversión —línea 14. Taxact 2011 free federal edition download Pérdidas por hecho fortuito y robo de bienes de uso personal —línea 20. Taxact 2011 free federal edition download Pérdidas por hecho fortuito y robo de bienes que generan ingresos —línea 28. Taxact 2011 free federal edition download Pérdidas por apuestas y juegos de azar —línea 28. Taxact 2011 free federal edition download ¿Cómo se Calcula el Límite? Si las deducciones detalladas están sujetas al límite, el total de todas sus deducciones detalladas es reducido por la cantidad menor de uno de: el 80% de las deducciones detalladas afectadas por el límite. Taxact 2011 free federal edition download Vea ¿Qué Deducciones Detalladas Están Limitadas? , anteriormente o el 3% de la cantidad por la cual los ingresos brutos ajustados sobrepasen $300,000, si es casado que presenta la declaración conjunta o viudo calificado, $275,000, si es cabeza de familia, $250,000, si es soltero o $150,000, si es casado que presenta la declaración por separado. Taxact 2011 free federal edition download Antes de calcular el límite general sobre las deducciones detalladas, primero tiene que llenar las líneas 1 a 28 del Anexo A (Formulario 1040), incluyendo todo formulario afín (tal como el Formulario 2106, el Formulario 4684, etc. Taxact 2011 free federal edition download ) El límite general sobre las deducciones detalladas se calcula después de haberse aplicado cualquier otro límite sobre la asignación de alguna deducción detallada. Taxact 2011 free federal edition download Estos límites adicionales abarcan los límites sobre donaciones caritativas (capítulo 24), el límite sobre determinados gastos de comida y entretenimiento (capítulo 26) y el límite del 2% de los ingresos brutos ajustados sobre determinadas deducciones misceláneas (capítulo 28). Taxact 2011 free federal edition download Hoja de trabajo de deducciones detalladas. Taxact 2011 free federal edition download   Después de completar hasta la línea 28, inclusive, del Anexo A (Formulario 1040), puede utilizar la Itemized Deductions Worksheet (Hoja de trabajo de las deducciones detalladas), en las Instrucciones del Anexo A (Formulario 1040) para calcular el límite. Taxact 2011 free federal edition download Anote el resultado en la línea 29 del Anexo A (Formulario 1040). Taxact 2011 free federal edition download Guarde la hoja de trabajo con su documentación. Taxact 2011 free federal edition download Debe comparar la cantidad de la deducción estándar con la cantidad de las deducciones detalladas después de aplicar el límite. Taxact 2011 free federal edition download Utilice la cantidad mayor cuando complete la línea 40 (Formulario 1040). Taxact 2011 free federal edition download Vea el capítulo 20 para información sobre cómo calcular la deducción estándar. Taxact 2011 free federal edition download Ejemplo Para el año tributario 2013, Guillermo y Teresa Valdez presentan la declaración conjunta en el Formulario 1040. Taxact 2011 free federal edition download Tienen ingresos brutos ajustados de $325,500 en la línea 38. Taxact 2011 free federal edition download Las deducciones detalladas de su Anexo A son las siguientes: Impuestos pagados —línea 9   $ 17,900 Intereses pagados —líneas 10,11,12 y 13   45,000 Gasto de intereses de inversión  —línea 14   41,000 Donaciones a organizaciones caritativas —línea 19   21,000 Gastos laborales —línea 27   17,240 Total   $142,140       La deducción por gastos de intereses de inversión de los Valdez ($41,000 de la línea 14 del Anexo A (Formulario 1040) no está sujeta al límite general de las deducciones detalladas. Taxact 2011 free federal edition download Los Valdez utilizan la Itemized Deductions Worksheet (Hoja de trabajo de las deducciones detalladas), en las Instrucciones del Anexo A (Formulario 1040) para calcular el límite general. Taxact 2011 free federal edition download Del total de las deducciones detalladas de $142,140, los Valdez pueden deducir sólo $141,375 ($142,140 - $765). Taxact 2011 free federal edition download Anotan $141,375 en la línea 29 del Anexo A (Formulario 1040). Taxact 2011 free federal edition download Prev  Up  Next   Home   More Online Publications
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The Taxact 2011 Free Federal Edition Download

Taxact 2011 free federal edition download 10. Taxact 2011 free federal edition download   Self-Employment (SE) Tax Table of Contents Who Must Pay SE Tax?Special Rules and Exceptions Figuring Earnings Subject to SE Tax Farm Optional Method Using Both Optional Methods Reporting Self-Employment Tax The SE tax rules apply no matter how old you are and even if you are already receiving social security and Medicare benefits. Taxact 2011 free federal edition download Who Must Pay SE Tax? Generally, you must pay SE tax and file Schedule SE (Form 1040) if your net earnings from self-employment were $400 or more. Taxact 2011 free federal edition download Use Schedule SE to figure net earnings from self-employment. Taxact 2011 free federal edition download Sole proprietor or independent contractor. Taxact 2011 free federal edition download   If you are self-employed as a sole proprietor or independent contractor, you generally use Schedule C or C-EZ (Form 1040) to figure your earnings subject to SE tax. Taxact 2011 free federal edition download SE tax rate. Taxact 2011 free federal edition download    For 2013, the SE tax rate on net earnings is 15. Taxact 2011 free federal edition download 3% (12. Taxact 2011 free federal edition download 4% social security tax plus 2. Taxact 2011 free federal edition download 9% Medicare tax). Taxact 2011 free federal edition download Maximum earnings subject to self-employment tax. Taxact 2011 free federal edition download    Only the first $113,700 of your combined wages, tips, and net earnings in 2013 is subject to any combination of the 12. Taxact 2011 free federal edition download 4% social security part of SE tax, social security tax, or railroad retirement (tier 1) tax. Taxact 2011 free federal edition download   All of your combined wages, tips, and net earnings in 2013 are subject to any combination of the 2. Taxact 2011 free federal edition download 9% Medicare part of SE tax, social security tax, or railroad retirement (tier 1) tax. Taxact 2011 free federal edition download   If your wages and tips are subject to either social security or railroad retirement (tier 1) tax, or both, and total at least $113,700, do not pay the 12. Taxact 2011 free federal edition download 4% social security part of the SE tax on any of your net earnings. Taxact 2011 free federal edition download However, you must pay the 2. Taxact 2011 free federal edition download 9% Medicare part of the SE tax on all your net earnings. Taxact 2011 free federal edition download Special Rules and Exceptions Aliens. Taxact 2011 free federal edition download   Generally, resident aliens must pay self-employment tax under the same rules that apply to U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download citizens. Taxact 2011 free federal edition download Nonresident aliens are not subject to SE tax unless an international social security agreement in effect determines that they are covered under the U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download social security system. Taxact 2011 free federal edition download However, residents of the Virgin Islands, Puerto Rico, Guam, the Commonwealth of the Northern Mariana Islands, or American Samoa are subject to self-employment tax, as they are considered U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download residents for self-employment tax purposes. Taxact 2011 free federal edition download For more information on aliens, see Publication 519, U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download Tax Guide for Aliens. Taxact 2011 free federal edition download Child employed by parent. Taxact 2011 free federal edition download   You are not subject to SE tax if you are under age 18 and you are working for your father or mother. Taxact 2011 free federal edition download Church employee. Taxact 2011 free federal edition download    If you work for a church or a qualified church-controlled organization (other than as a minister or member of a religious order) that elected an exemption from social security and Medicare taxes, you are subject to SE tax if you receive $108. Taxact 2011 free federal edition download 28 or more in wages from the church or organization. Taxact 2011 free federal edition download For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. Taxact 2011 free federal edition download Fishing crew member. Taxact 2011 free federal edition download   If you are a member of the crew on a boat that catches fish or other water life, your earnings are subject to SE tax if all the following conditions apply. Taxact 2011 free federal edition download You do not get any pay for the work except your share of the catch or a share of the proceeds from the sale of the catch, unless the pay meets all the following conditions. Taxact 2011 free federal edition download The pay is not more than $100 per trip. Taxact 2011 free federal edition download The pay is received only if there is a minimum catch. Taxact 2011 free federal edition download The pay is solely for additional duties (such as mate, engineer, or cook) for which additional cash pay is traditional in the fishing industry. Taxact 2011 free federal edition download You get a share of the catch or a share of the proceeds from the sale of the catch. Taxact 2011 free federal edition download Your share depends on the amount of the catch. Taxact 2011 free federal edition download The boat's operating crew normally numbers fewer than 10 individuals. Taxact 2011 free federal edition download (An operating crew is considered as normally made up of fewer than 10 if the average size of the crew on trips made during the last four calendar quarters is fewer than 10. Taxact 2011 free federal edition download ) Notary public. Taxact 2011 free federal edition download   Fees you receive for services you perform as a notary public are reported on Schedule C or C-EZ but are not subject to self-employment tax (see the Instructions for Schedule SE (Form 1040)). Taxact 2011 free federal edition download State or local government employee. Taxact 2011 free federal edition download   You are subject to SE tax if you are an employee of a state or local government, are paid solely on a fee basis, and your services are not covered under a federal-state social security agreement. Taxact 2011 free federal edition download Foreign government or international organization employee. Taxact 2011 free federal edition download   You are subject to SE tax if both the following conditions are true. Taxact 2011 free federal edition download You are a U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download citizen employed in the United States, Puerto Rico, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, or the Virgin Islands by: A foreign government, A wholly-owned agency of a foreign government, or An international organization. Taxact 2011 free federal edition download Your employer is not required to withhold social security and Medicare taxes from your wages. Taxact 2011 free federal edition download U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download citizen or resident alien residing abroad. Taxact 2011 free federal edition download    If you are a self-employed U. Taxact 2011 free federal edition download S. Taxact 2011 free federal edition download citizen or resident alien living outside the United States, in most cases you must pay SE tax. Taxact 2011 free federal edition download Do not reduce your foreign earnings from self-employment by your foreign earned income exclusion. Taxact 2011 free federal edition download Exception. Taxact 2011 free federal edition download    The United States has social security agreements with many countries to eliminate double taxation under two social security systems. Taxact 2011 free federal edition download Under these agreements, you generally must only pay social security and Medicare taxes to the country in which you live. Taxact 2011 free federal edition download The country to which you must pay the tax will issue a certificate which serves as proof of exemption from social security tax in the other country. Taxact 2011 free federal edition download   For more information, see the Instructions for Schedule SE (Form 1040). Taxact 2011 free federal edition download More Than One Business If you have earnings subject to SE tax from more than one trade, business, or profession, you must combine the net profit (or loss) from each to determine your total earnings subject to SE tax. Taxact 2011 free federal edition download A loss from one business reduces your profit from another business. Taxact 2011 free federal edition download Community Property Income If any of the income from a trade or business, other than a partnership, is community property income under state law, it is included in the earnings subject to SE tax of the spouse carrying on the trade or business. Taxact 2011 free federal edition download Gain or Loss Do not include in earnings subject to SE tax a gain or loss from the disposition of property that is neither stock in trade nor held primarily for sale to customers. Taxact 2011 free federal edition download It does not matter whether the disposition is a sale, exchange, or an involuntary conversion. Taxact 2011 free federal edition download Lost Income Payments If you are self-employed and reduce or stop your business activities, any payment you receive from insurance or other sources for the lost business income is included in earnings subject to SE tax. Taxact 2011 free federal edition download If you are not working when you receive the payment, it still relates to your business and is included in earnings subject to SE tax, even though your business is temporarily inactive. Taxact 2011 free federal edition download Figuring Earnings Subject to SE Tax Methods for Figuring Net Earnings There are three ways to figure your net earnings from self-employment. Taxact 2011 free federal edition download The regular method. Taxact 2011 free federal edition download The nonfarm optional method. Taxact 2011 free federal edition download The farm optional method. Taxact 2011 free federal edition download You must use the regular method unless you are eligible to use one or both of the optional methods. Taxact 2011 free federal edition download Why use an optional method?    You may want to use the optional methods (discussed later) when you have a loss or a small net profit and any one of the following applies. Taxact 2011 free federal edition download You want to receive credit for social security benefit coverage. Taxact 2011 free federal edition download You incurred child or dependent care expenses for which you could claim a credit. Taxact 2011 free federal edition download (An optional method may increase your earned income, which could increase your credit. Taxact 2011 free federal edition download ) You are entitled to the earned income credit. Taxact 2011 free federal edition download (An optional method may increase your earned income, which could increase your credit. Taxact 2011 free federal edition download ) You are entitled to the additional child tax credit. Taxact 2011 free federal edition download (An optional method may increase your earned income, which could increase your credit. Taxact 2011 free federal edition download ) Effects of using an optional method. Taxact 2011 free federal edition download   Using an optional method could increase your SE tax. Taxact 2011 free federal edition download Paying more SE tax could result in your getting higher benefits when you retire. Taxact 2011 free federal edition download   If you use either or both optional methods, you must figure and pay the SE tax due under these methods even if you would have had a smaller tax or no tax using the regular method. Taxact 2011 free federal edition download   The optional methods may be used only to figure your SE tax. Taxact 2011 free federal edition download To figure your income tax, include your actual earnings in gross income, regardless of which method you use to determine SE tax. Taxact 2011 free federal edition download Regular Method Multiply your total earnings subject to SE tax by 92. Taxact 2011 free federal edition download 35% (. Taxact 2011 free federal edition download 9235) to get your net earnings under the regular method. Taxact 2011 free federal edition download See Short Schedule SE, line 4, or Long Schedule SE, line 4a. Taxact 2011 free federal edition download Net earnings figured using the regular method are also called actual net earnings. Taxact 2011 free federal edition download Nonfarm Optional Method Use the nonfarm optional method only for earnings that do not come from farming. Taxact 2011 free federal edition download You may use this method if you meet all the following tests. Taxact 2011 free federal edition download You are self-employed on a regular basis. Taxact 2011 free federal edition download This means that your actual net earnings from self-employment were $400 or more in at least 2 of the 3 tax years before the one for which you use this method. Taxact 2011 free federal edition download The net earnings can be from either farm or nonfarm earnings or both. Taxact 2011 free federal edition download You have used this method less than 5 years. Taxact 2011 free federal edition download (There is a 5-year lifetime limit. Taxact 2011 free federal edition download ) The years do not have to be one after another. Taxact 2011 free federal edition download Your net nonfarm profits were: Less than $5,024, and Less than 72. Taxact 2011 free federal edition download 189% of your gross nonfarm income. Taxact 2011 free federal edition download Net nonfarm profits. Taxact 2011 free federal edition download   Net nonfarm profit generally is the total of the amounts from: Line 31, Schedule C (Form 1040), Line 3, Schedule C-EZ (Form 1040), Box 14, code A, Schedule K-1 (Form 1065) (from nonfarm partnerships), and Box 9, code J1, Schedule K-1 (Form 1065-B). Taxact 2011 free federal edition download   However, you may need to adjust the amount reported on Schedule K-1 if you are a general partner or if it is a loss. Taxact 2011 free federal edition download Gross nonfarm income. Taxact 2011 free federal edition download   Your gross nonfarm income generally is the total of the amounts from: Line 7, Schedule C (Form 1040), Line 1, Schedule C-EZ (Form 1040), Box 14, code C, Schedule K-1 (Form 1065) (from nonfarm partnerships), and Box 9, code J2, Schedule K-1 (Form 1065-B). Taxact 2011 free federal edition download Figuring Nonfarm Net Earnings If you meet the three tests explained earlier, use the following table to figure your net earnings from self-employment under the nonfarm optional method. Taxact 2011 free federal edition download Table 10-1. Taxact 2011 free federal edition download Figuring Nonfarm Net Earnings IF your gross nonfarm income is. Taxact 2011 free federal edition download . Taxact 2011 free federal edition download . Taxact 2011 free federal edition download THEN your net earnings are equal to. Taxact 2011 free federal edition download . Taxact 2011 free federal edition download . Taxact 2011 free federal edition download $6,960 or less Two-thirds of your gross nonfarm income. Taxact 2011 free federal edition download More than $6,960 $4,640 Actual net earnings. Taxact 2011 free federal edition download   Your actual net earnings are 92. Taxact 2011 free federal edition download 35% of your total earnings subject to SE tax (that is, multiply total earnings subject to SE tax by 92. Taxact 2011 free federal edition download 35% (. Taxact 2011 free federal edition download 9235) to get actual net earnings). Taxact 2011 free federal edition download Actual net earnings are equivalent to net earnings figured using the regular method. Taxact 2011 free federal edition download Optional net earnings less than actual net earnings. Taxact 2011 free federal edition download   You cannot use this method to report an amount less than your actual net earnings from self-employment. Taxact 2011 free federal edition download Gross nonfarm income of $6,960 or less. Taxact 2011 free federal edition download   The following examples illustrate how to figure net earnings when gross nonfarm income is $6,960 or less. Taxact 2011 free federal edition download Example 1. Taxact 2011 free federal edition download Net nonfarm profit less than $5,024 and less than 72. Taxact 2011 free federal edition download 189% of gross nonfarm income. Taxact 2011 free federal edition download Ann Green runs a craft business. Taxact 2011 free federal edition download Her actual net earnings from self-employment were $800 in 2011 and $900 in 2012. Taxact 2011 free federal edition download She meets the test for being self-employed on a regular basis. Taxact 2011 free federal edition download She has used the nonfarm optional method less than 5 years. Taxact 2011 free federal edition download Her gross income and net profit in 2013 are as follows: Gross nonfarm income $5,400 Net nonfarm profit $1,200 Ann's actual net earnings for 2013 are $1,108 ($1,200 × . Taxact 2011 free federal edition download 9235). Taxact 2011 free federal edition download Because her net profit is less than $5,024 and less than 72. Taxact 2011 free federal edition download 189% of her gross income, she can use the nonfarm optional method to figure net earnings of $3,600 (2/3 × $5,400). Taxact 2011 free federal edition download Because these net earnings are higher than her actual net earnings, she can report net earnings of $3,600 for 2013. Taxact 2011 free federal edition download Example 2. Taxact 2011 free federal edition download Net nonfarm profit less than $5,024 but not less than 72. Taxact 2011 free federal edition download 189% of gross nonfarm income. Taxact 2011 free federal edition download Assume that in Example 1 Ann's gross income is $1,000 and her net profit is $800. Taxact 2011 free federal edition download She must use the regular method to figure her net earnings. Taxact 2011 free federal edition download She cannot use the nonfarm optional method because her net profit is not less than 72. Taxact 2011 free federal edition download 189% of her gross income. Taxact 2011 free federal edition download Example 3. Taxact 2011 free federal edition download Net loss from a nonfarm business. Taxact 2011 free federal edition download Assume that in Example 1 Ann has a net loss of $700. Taxact 2011 free federal edition download She can use the nonfarm optional method and report $3,600 (2/3 × $5,400) as her net earnings. Taxact 2011 free federal edition download Example 4. Taxact 2011 free federal edition download Nonfarm net earnings less than $400. Taxact 2011 free federal edition download Assume that in Example 1 Ann has gross income of $525 and a net profit of $175. Taxact 2011 free federal edition download In this situation, she would not pay any SE tax under either the regular method or the nonfarm optional method because her net earnings under both methods are less than $400. Taxact 2011 free federal edition download Gross nonfarm income of more than $6,960. Taxact 2011 free federal edition download   The following examples illustrate how to figure net earnings when gross nonfarm income is more than $6,960. Taxact 2011 free federal edition download Example 1. Taxact 2011 free federal edition download Net nonfarm profit less than $5,024 and less than 72. Taxact 2011 free federal edition download 189% of gross nonfarm income. Taxact 2011 free federal edition download John White runs an appliance repair shop. Taxact 2011 free federal edition download His actual net earnings from self-employment were $10,500 in 2011 and $9,500 in 2012. Taxact 2011 free federal edition download He meets the test for being self-employed on a regular basis. Taxact 2011 free federal edition download He has used the nonfarm optional method less than 5 years. Taxact 2011 free federal edition download His gross income and net profit in 2013 are as follows: Gross nonfarm income $12,000 Net nonfarm profit $1,200 John's actual net earnings for 2013 are $1,108 ($1,200 × . Taxact 2011 free federal edition download 9235). Taxact 2011 free federal edition download Because his net profit is less than $5,024 and less than 72. Taxact 2011 free federal edition download 189% of his gross income, he can use the nonfarm optional method to figure net earnings of $4,640. Taxact 2011 free federal edition download Because these net earnings are higher than his actual net earnings, he can report net earnings of $4,640 for 2013. Taxact 2011 free federal edition download Example 2. Taxact 2011 free federal edition download Net nonfarm profit not less than $5,024. Taxact 2011 free federal edition download Assume that in Example 1 John's net profit is $5,400. Taxact 2011 free federal edition download He must use the regular method. Taxact 2011 free federal edition download He cannot use the nonfarm optional method because his net nonfarm profit is not less than $5,024. Taxact 2011 free federal edition download Example 3. Taxact 2011 free federal edition download Net loss from a nonfarm business. Taxact 2011 free federal edition download Assume that in Example 1 John has a net loss of $700. Taxact 2011 free federal edition download He can use the nonfarm optional method and report $4,640 as his net earnings from self-employment. Taxact 2011 free federal edition download Farm Optional Method Use the farm optional method only for earnings from a farming business. Taxact 2011 free federal edition download See Publication 225 for information about this method. Taxact 2011 free federal edition download Using Both Optional Methods If you have both farm and nonfarm earnings, you may be able to use both optional methods to determine your net earnings from self-employment. Taxact 2011 free federal edition download To figure your net earnings using both optional methods, you must: Figure your farm and nonfarm net earnings separately under each method. Taxact 2011 free federal edition download Do not combine farm earnings with nonfarm earnings to figure your net earnings under either method. Taxact 2011 free federal edition download Add the net earnings figured under each method to arrive at your total net earnings from self-employment. Taxact 2011 free federal edition download You can report less than your total actual farm and nonfarm net earnings but not less than actual nonfarm net earnings. Taxact 2011 free federal edition download If you use both optional methods, you can report no more than $4,640 as your combined net earnings from self-employment. Taxact 2011 free federal edition download Example. Taxact 2011 free federal edition download You are a self-employed farmer. Taxact 2011 free federal edition download You also operate a retail grocery store. Taxact 2011 free federal edition download Your gross income, actual net earnings from self-employment, and optional farm and optional nonfarm net earnings from self-employment are shown in Table 10-2. Taxact 2011 free federal edition download Table 10-2. Taxact 2011 free federal edition download Example—Farm and Nonfarm Earnings Income and Earnings Farm Nonfarm Gross income $3,000 $6,000 Actual net earnings $900 $500 Optional net earnings (2/3 of gross income) $2,000 $4,000 Table 10-3 shows four methods or combinations of methods you can use to figure net earnings from self-employment using the farm and nonfarm gross income and actual net earnings shown in Table 10-2. Taxact 2011 free federal edition download Method 1. Taxact 2011 free federal edition download Using the regular method for both farm and nonfarm income. Taxact 2011 free federal edition download Method 2. Taxact 2011 free federal edition download Using the optional method for farm income and the regular method for nonfarm income. Taxact 2011 free federal edition download Method 3. Taxact 2011 free federal edition download Using the regular method for farm income and the optional method for nonfarm income. Taxact 2011 free federal edition download Method 4. Taxact 2011 free federal edition download Using the optional method for both farm and nonfarm income. Taxact 2011 free federal edition download Note. Taxact 2011 free federal edition download Actual net earnings is the same as net earnings figured using the regular method. Taxact 2011 free federal edition download Table 10-3. Taxact 2011 free federal edition download Example—Net Earnings Net Earnings 1 2 3 4 Actual  farm $ 900   $ 900   Optional  farm   $ 2,000   $ 2,000 Actual nonfarm $ 500 $ 500     Optional nonfarm     $4,000 $4,000 Amount you can report: $1,400 $2,500 $4,900 $4,640* *Limited to $4,640 because you used both optional methods. Taxact 2011 free federal edition download Fiscal Year Filer If you use a tax year other than the calendar year, you must use the tax rate and maximum earnings limit in effect at the beginning of your tax year. Taxact 2011 free federal edition download Even if the tax rate or maximum earnings limit changes during your tax year, continue to use the same rate and limit throughout your tax year. Taxact 2011 free federal edition download Reporting Self-Employment Tax Use Schedule SE (Form 1040) to figure and report your SE tax. Taxact 2011 free federal edition download Then enter the SE tax on line 56 of Form 1040 and attach Schedule SE to Form 1040. Taxact 2011 free federal edition download Most taxpayers can use Section A—Short Schedule SE to figure their SE tax. Taxact 2011 free federal edition download However, certain taxpayers must use Section B—Long Schedule SE. Taxact 2011 free federal edition download If you have to pay SE tax, you must file Form 1040 (with Schedule SE attached) even if you do not otherwise have to file a federal income tax return. Taxact 2011 free federal edition download Joint return. Taxact 2011 free federal edition download   Even if you file a joint return, you cannot file a joint Schedule SE. Taxact 2011 free federal edition download This is true whether one spouse or both spouses have earnings subject to SE tax. Taxact 2011 free federal edition download If both of you have earnings subject to SE tax, each of you must complete a separate Schedule SE. Taxact 2011 free federal edition download However, if one spouse uses the Short Schedule SE and the other spouse has to use the Long Schedule SE, both can use the same form. Taxact 2011 free federal edition download Attach both schedules to the joint return. Taxact 2011 free federal edition download More than one business. Taxact 2011 free federal edition download   If you have more than one trade or business, you must combine the net profit (or loss) from each business to figure your SE tax. Taxact 2011 free federal edition download A loss from one business will reduce your profit from another business. Taxact 2011 free federal edition download File one Schedule SE showing the earnings from self-employment, but file a separate Schedule C, C-EZ, or F for each business. Taxact 2011 free federal edition download Example. Taxact 2011 free federal edition download You are the sole proprietor of two separate businesses. Taxact 2011 free federal edition download You operate a restaurant that made a net profit of $25,000. Taxact 2011 free federal edition download You also have a cabinetmaking business that had a net loss of $500. Taxact 2011 free federal edition download You must file a Schedule C for the restaurant showing your net profit of $25,000 and another Schedule C for the cabinetmaking business showing your net loss of $500. Taxact 2011 free federal edition download You file Schedule SE showing total earnings subject to SE tax of $24,500. Taxact 2011 free federal edition download Prev  Up  Next   Home   More Online Publications