Instructions For Schedule Se (Form 1040) - 2011
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5Department of the Treasury
Internal Revenue Service
2011 Instructions for Schedule SE (Form 1040)
Use Schedule SE (Form 1040) to figure the tax due on net earnings from self-employment.
Self-Employment
The Social Security Administration uses the information from Schedule SE to figure your
benefits under the social security program. This tax applies no matter how old you are and
Tax
even if you are already getting social security or Medicare benefits.
Additional information.
See Pub. 225 or Pub. 334.
it may be to your benefit to file Schedule
If you have ever filed Form
Section references are to the Internal
SE and use either ‘‘optional method’’ in
2031 to elect social security
Revenue Code unless otherwise noted.
coverage on your earnings as a
Part II of Long Schedule SE (discussed
minister, you cannot revoke
later).
that election.
What’s New
Exception.
If your only self-employment
If you must pay SE tax, include this in-
income was from earnings as a minister,
More information.
The IRS has created a
come on either Short or Long Schedule SE,
member of a religious order, or Christian
page on IRS.gov for information about
line 2. But do not report it on Long Sched-
Form 1040 and its instructions, at
Science practitioner, see Ministers and
ule SE, line 5a; it is not considered church
gov/form1040
. Information about any re-
Members of Religious Orders .
employee income. Also, include on line 2:
cent developments affecting Schedule SE
•
The rental value of a home or an al-
will be posted on that page.
Who Must Pay
lowance for a home furnished to you (in-
Self-Employment (SE) Tax
cluding payments for utilities), and
Maximum income subject to social security
•
tax.
The maximum amount of self-em-
The value of meals and lodging pro-
Self-Employed Persons
ployment income subject to social security
vided to you, your spouse, and your depen-
tax remains $106,800.
dents for your employer’s convenience.
You must pay SE tax if you had net earn-
ings of $400 or more as a self-employed
However, do not include on line 2:
Deduction for self-employed health insur-
•
person. If you are in business (farm or non-
ance.
You can no longer reduce your net
Retirement benefits you received
farm) for yourself, you are self-employed.
self-employment income by the amount of
from a church plan after retirement, or
your self-employed health insurance de-
•
The rental value of a home or an al-
You must also pay SE tax on your share
duction (from line 29 of Form 1040 or
lowance for a home furnished to you (in-
of certain partnership income and your
Form 1040NR).
cluding payments for utilities) after
guaranteed payments. See Partnership In-
retirement.
SE tax rate.
For 2011, the Old Age, Survi-
come or Loss , later.
vors, and Disability Insurance (OASDI)
If you were a duly ordained minister
portion of the SE tax is reduced by 2%,
who was an employee of a church and you
Employees of Churches and
from 12.4% to 10.4%. The Medicare (HI)
must pay SE tax, when figuring SE tax,
Church Organizations
portion of the SE tax remains 2.9%. As a
subtract on line 2 allowable expenses from
If you had church employee income of
result, the SE tax rate is reduced from
your self-employment earnings and attach
$108.28 or more, you must pay SE tax.
15.3% to 13.3%.
an explanation. Please note that the un-
Church employee income is wages you re-
reimbursed employee business expenses
SE tax deduction.
For 2011, the SE tax de-
ceived as an employee (other than as a min-
that you incurred as an employee of the
duction is revised to reflect an employer’s
ister or member of a religious order) of a
church are not allowable expenses for SE
equivalent portion of tax. Previously, the
church or qualified church-controlled or-
tax purposes, and are allowed only as an
deduction was equal to one-half of self-em-
ganization that has a certificate in effect
itemized deduction for income tax pur-
ployment tax.
electing an exemption from employer so-
poses.
cial security and Medicare taxes.
If you were a U.S. citizen or resident
alien serving outside the United States as a
General Instructions
Ministers and Members of
minister or member of a religious order and
Religious Orders
you must pay SE tax, you cannot reduce
Who Must File Schedule SE
In most cases, you must pay SE tax on sala-
your net earnings by the foreign earned in-
ries and other income for services you per-
come exclusion or the foreign housing ex-
You must file Schedule SE if:
formed as a minister, a member of a
clusion or deduction.
•
The amount on line 4 of Short Sched-
religious order who has not taken a vow of
See Pub. 517 for details.
ule SE or line 4c of Long Schedule SE is
poverty, or a Christian Science practitioner.
$400 or more, or
Members of Certain Religious
But if you filed Form 4361 and received
•
You had church employee income of
Sects
IRS approval, you will be exempt from
$108.28 or more. Income from services you
paying SE tax on those net earnings. If you
If you have conscientious objections to so-
performed as a minister or a member of a
had no other income subject to SE tax,
cial security insurance because of your
religious order is not church employee in-
enter “Exempt — Form 4361” on Form
membership in and belief in the teachings
come. See Employees of Churches and
1040, line 56, or Form 1040NR, line 54.
of a religious sect recognized as being in
Church Organizations .
However, if you had other net earnings of
existence at all times since December 31,
Note.
Even if you had a loss or a small
$400 or more subject to SE tax, see line A
1950, and which has provided a reasonable
amount of income from self-employment,
at the top of Long Schedule SE.
level of living for its dependent members,
SE-1
Oct 14, 2011
Cat. No. 24334P
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