Instructions For Schedule Se (Form 1040) - 2011 Page 3
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5Fiscal Year Filers
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If you are not the spouse who carried on
If the total of lines 1a and 2 is $434 or
the business and you had no other income
more, file Schedule SE (completed through
If your tax year is a fiscal year, use the tax
subject to SE tax, enter “Exempt commu-
line 4c) with your tax return. Enter -0- on
rate and earnings base that apply at the time
nity income” on Form 1040, line 56, or
Form 1040, line 56,* or Form 1040NR, line
the fiscal year begins. Do not prorate the
Form 1040NR, line 54. Do not file Sched-
54.*
tax or earnings base for a fiscal year that
ule SE. However, if you had $400 or more
•
If the total of lines 1a and 2 is less than
overlaps the date of a rate or earnings base
of other net earnings subject to SE tax, in-
$434, do not file Schedule SE unless you
change.
clude on Schedule SE, line 1a or 2, the net
choose to use an optional method to figure
profit or (loss) from Schedule(s) C, C-EZ,
your SE tax.
or F allocated to you as community income.
* If you also have church employee income
Line Instructions
Also, enter on the dotted line to the left of
(described earlier under Employees of
Schedule SE, line 3, “Exempt community
Churches and Church Organizations ), also
Read the flowchart on page 1 of Schedule
income” and the allocated amount. If that
complete lines 5a and 5b. Complete the rest
SE to see if you can use Section A — Short
amount is a net profit, subtract it from the
of Schedule SE, as appropriate.
Schedule SE, or if you must use Section
total of lines 1a, 1b, and 2, and enter the
B — Long Schedule SE. For either section,
result on line 3. If that amount is a loss,
you will need to know what your net earn-
treat it as a positive amount, add it to the
Net Earnings From
ings from self-employment are. To find out
total of lines 1a, 1b, and 2, and enter the
what is included as net earnings from
result on line 3.
Self-Employment
self-employment, see Net Earnings From
Community income included
Self-Employment .
In most cases, net earnings include your net
on Schedule(s) C, C-EZ, or F
profit from a farm or nonfarm business.
Enter all negative amounts in
must be divided for income tax
parentheses.
purposes based on the commu-
TIP
Partnership Income or Loss
nity property laws of your state. See Pub.
If you were a general or limited partner in a
555 for more information.
partnership, include on line 1a or line 2,
You Have Only Church
Qualified Joint Ventures
whichever applies, the amount of net earn-
Employee Income Subject to
ings from self-employment from Schedule
If you and your spouse materially partici-
K-1 (Form 1065), box 14, code A, and
SE Tax
pate (see Material participation in the 2011
Schedule K-1 (Form 1065-B), box 9, code
Instructions for Schedule C) as the only
If your only income subject to SE tax is
J1. General partners should reduce this
members of a jointly owned and operated
church employee income (described earlier
amount by certain expenses before entering
business, and you file a joint return for the
under Employees of Churches and Church
it on Schedule SE. See your Schedule K-1
tax year, you can make a joint election to be
Organizations ), skip lines 1 through 4b.
instructions. If you reduce the amount you
taxed as a qualified joint venture instead of
Enter -0- on line 4c and go to line 5a.
enter on Schedule SE, you must attach an
a partnership.
explanation. Limited partners include only
Note.
Income from services you perform
To make this election, you must divide
guaranteed payments for services actually
as a minister of a religious order is not
all items of income, gain, loss, deduction,
rendered to or on behalf of the partnership.
church employee income.
and credit attributable to the business be-
If a partner died and the partnership
tween you and your spouse in accordance
Line 1b (Short or Long
continued, include in self-employment in-
with your respective interests in the ven-
Schedule SE)
come the deceased’s distributive share of
ture. Each of you must file a separate
the partnership’s ordinary income or loss
Schedule C, C-EZ, or F. On each line of
If you were receiving social security retire-
through the end of the month in which he or
your separate Schedule C, C-EZ, or F, you
ment or social security disability benefits at
she died. See section 1402(f).
must enter your share of the applicable in-
the time you received your Conservation
come, deduction, or loss. Each of you also
If you were married and both you and
Reserve Program (CRP) payment(s), enter
must file a separate Schedule SE to pay SE
your spouse were partners in a partnership,
the amount of your taxable CRP
tax, as applicable.
each of you must report your net earnings
payment(s) on line 1b. These payments are
from self-employment from the partner-
included on Schedule F, line 4b, or listed
For more information on qualified joint
ship. Each of you must file a separate
on Schedule K-1 (Form 1065), box 20,
ventures, go to IRS.gov. Enter “qualified
Schedule SE and report the partnership in-
code Y.
joint venture” in the search box and select
come or loss on Schedule E (Form 1040),
“Election for Husband and Wife Unincorp-
Line 4 (Short Schedule SE)
Part II, for income tax purposes. If only one
orated Businesses.”
of you was a partner in a partnership, the
If line 4 is less than $400 and you have an
Rental real estate business.
If you and
spouse who was the partner must report his
amount on line 1b, combine lines 1a and 2.
your spouse make the election for your
or her net earnings from self-employment
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If the total of lines 1a and 2 is $434 or
rental real estate business, the income gen-
from the partnership.
more, file Schedule SE (completed through
erally is not subject to SE tax. To indicate
line 4) with your tax return. Enter -0- on
Your own distribu-
Community income.
that election, be sure to check the “QJV”
Form 1040, line 56, or Form 1040NR, line
tive share of partnership income is included
box in Part I, line 2, of each Schedule E that
54.
in figuring your net earnings from self-em-
the rental property is listed on. Do not file
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ployment. Unlike the division of that in-
If the total of lines 1a and 2 is less than
Schedule SE unless you have other income
come between spouses for figuring income
$434, do not file Schedule SE unless you
subject to SE tax. For an exception to this
tax, no part of your share can be included in
choose to use an optional method for figur-
income not being subject to SE tax, see
figuring your spouse’s net earnings from
ing your SE tax.
item 3 under Other Income and Losses In-
self-employment.
cluded in Net Earnings From Self-Employ-
Lines 4a Through 4c (Long
ment , later).
Registered domestic partners
Schedule SE)
If the election is made for a farm rental
and same-sex spouses in Cali-
business that is not included in self-em-
If both lines 4a and 4c are less than $400
fornia report community in-
come for self-employment tax
ployment, file two Forms 4835, Farm
and you have an amount on line 1b, com-
Rental Income and Expenses.
bine lines 1a and 2.
purposes the same way they do for income
SE-3
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