2010 Instruction 1040 Schedule Se (Form 1040) Page 3
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1
2
3
4
5Community income included
Lines 4a Through 4c (Long
as any specific instructions needed to fill
on Schedule(s) C, C-EZ, or F
out the form.
Schedule SE)
must be divided for income tax
Enter all negative amounts in parenthe-
If both lines 4a and 4c are less than $400
purposes based on the commu-
and you have an amount on line 1b, com-
nity property laws of your state. See Pub.
ses.
bine lines 1a and 2.
555 for more information.
•
You Have Only Church
If the total of lines 1a and 2 is $434 or
Qualified Joint Ventures
more, file Schedule SE (completed through
Employee Income Subject to
If you and your spouse materially partici-
line 4c) with your tax return. Enter -0- on
SE Tax
pate (see Material participation in the 2010
Form 1040, line 56,* or Form 1040NR, line
Instructions for Schedule C) as the only
54.*
If your only income subject to SE tax is
members of a jointly owned and operated
•
church employee income (see Employees
If the total of lines 1a and 2 is less than
business, and you file a joint return for the
of Churches and Church Organizations on
$434, do not file Schedule SE unless you
tax year, you can make a joint election to be
page SE-1 for definition), skip lines 1
choose to use an optional method to figure
taxed as a qualified joint venture instead of
your SE tax.
through 4b. Enter -0- on line 4c and go to
a partnership.
line 5a.
*If you also have church employee income
To make this election, you must divide
(see page SE-1), also complete lines 5a and
all items of income, gain, loss, deduction,
5b. Complete the rest of Schedule SE, as
Note.
Income from services you perform
and credit attributable to the business be-
as a minister of a religious order is not
appropriate.
tween you and your spouse in accordance
church employee income.
with your respective interests in the ven-
ture. Each of you must file a separate
Line 1b (Short or Long
Net Earnings From
Schedule C, C-EZ, or F. On each line of
Schedule SE)
Self-Employment
your separate Schedule C, C-EZ, or F, you
must enter your share of the applicable in-
If you were receiving social security retire-
In most cases, net earnings include your net
come, deduction, or loss. Each of you also
ment or social security disability benefits at
profit from a farm or nonfarm business. If
must file a separate Schedule SE to pay SE
the time you received your Conservation
you were a partner in a partnership, see the
tax, as applicable.
Reserve Program (CRP) payment(s), enter
following instructions.
the amount of your taxable CRP
For more information on qualified joint
ventures, go to IRS.gov. Enter “QJV elec-
payment(s) on line 1b. These payments are
Partnership Income or Loss
tion” in the search box and select “Election
included on Schedule F, line 6b, or listed
If you were a general or limited partner in a
for Husband and Wife Unincorporated
on Schedule K-1 (Form 1065), box 20,
partnership, include on line 1a or line 2,
Businesses” and “Benefits of Qualified
code Y.
whichever applies, the amount of net earn-
Joint Ventures for Family Businesses.”
ings from self-employment from Schedule
Line 3 (Short or Long
If you and
Rental real estate business.
K-1 (Form 1065), box 14, code A, and
Schedule SE)
your spouse make the election for your
Schedule K-1 (Form 1065-B), box 9, code
rental real estate business, the income gen-
J1. General partners should reduce this
For 2010, you can reduce your net self-em-
erally is not subject to SE tax. To indicate
amount before entering it on Schedule SE
ployment income by the amount of your
that election, be sure to check the box in
by certain expenses (see your Schedule K-1
self-employed health insurance deduction
Part I, line 1, of each Schedule C reporting
instructions). If you reduce the amount you
entered on line 29 of Form 1040 or Form
this business. Do not file Schedule SE un-
enter on Schedule SE, you must attach an
1040NR. Be sure to subtract this amount
less you have other income subject to SE
explanation. Limited partners include only
after you combine lines 1a, 1b, and 2, and
tax. For an exception to this income not be-
guaranteed payments for services actually
before entering the result on line 3. If both
ing subject to SE tax, see item 3 under
rendered to or on behalf of the partnership.
you and your spouse are taking a deduction
Other Income and Losses Included in Net
for self-employed health insurance on line
Earnings From Self-Employment on page
If a partner died and the partnership
29 of a joint Form 1040, each of you sub-
SE-4).
continued, include in self-employment in-
tracts on line 3 of your separate Schedule
come the deceased’s distributive share of
If the election is made for a farm rental
SE only the amount attributable to your
the partnership’s ordinary income or loss
business that is not included in self-em-
own premiums.
through the end of the month in which he or
ployment, file two Forms 4835, Farm
she died. See section 1402(f).
Rental Income and Expenses.
The self-employed health insur-
Fiscal Year Filers
If you were married and both you and
ance deduction is allowed on
your spouse were partners in a partnership,
line 3 only if you have an entry
If your tax year is a fiscal year, use the tax
each of you must report your net earnings
(or entries) on lines 1a and/or 2
rate and earnings base that apply at the time
from self-employment from the partner-
of either the short or long Schedule SE.
the fiscal year begins. Do not prorate the
ship. Each of you must file a separate
tax or earnings base for a fiscal year that
Schedule SE and report the partnership in-
Line 4 (Short Schedule SE)
overlaps the date of a rate or earnings base
come or loss on Schedule E (Form 1040),
change.
If line 4 is less than $400 and you have an
Part II, for income tax purposes. If only one
of you was a partner in a partnership, the
amount on line 1b, combine lines 1a and 2.
spouse who was the partner must report his
•
If the total of lines 1a and 2 is $434 or
Specific Instructions
or her net earnings from self-employment
more, file Schedule SE (completed through
from the partnership.
line 4) with your tax return. Enter -0- on
Read the flowchart on page 1 of Schedule
Form 1040, line 56, or Form 1040NR, line
SE to see if you can use Section A — Short
Community income.
Your own distribu-
54.
Schedule SE, or if you must use Section
tive share of partnership income is included
•
If the total of lines 1a and 2 is less than
B — Long Schedule SE. For either section,
in figuring your net earnings from self-em-
$434, do not file Schedule SE unless you
you need to know what to include as net
ployment. Unlike the division of that in-
choose to use an optional method for figur-
earnings from self-employment. This sec-
come between spouses for figuring income
ing your SE tax.
tion will give you that information, as well
tax, no part of your share can be included in
SE-3
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