Instructions For Schedule Se Form 1040 - 2016 Page 2
ADVERTISEMENT
1
2
3
4
5
6U.S. Citizens or Resident Aliens
can’t reduce your net earnings by the
earlier, for information about interna-
Living Outside the United States
foreign earned income exclusion or the
tional social security agreements. If your
foreign housing exclusion or deduction.
self-employment income is subject to
If you are a self-employed U.S. citizen
SE tax, complete Schedule SE and file it
See Pub. 517 for details.
or resident alien living outside the Uni-
with your Form 1040NR.
ted States, in most cases you must pay
Members of Certain Religious
SE tax. You can’t reduce your foreign
Chapter 11 Bankruptcy Cases
Sects
earnings from self-employment by your
While you are a debtor in a chapter 11
foreign earned income exclusion.
If you have conscientious objections to
bankruptcy case, your net profit or loss
Exception. The United States has social
social security insurance because of
from self-employment (for example,
security agreements with many countries
your membership in and belief in the
from Schedule C or Schedule F) will not
to eliminate dual taxes under two social
teachings of a religious sect recognized
be included in your Form 1040 income.
security systems. Under these agree-
as being in existence at all times since
Instead, it will be included on the in-
ments, you must generally pay social se-
December 31, 1950, and which has pro-
come tax return (Form 1041) of the
curity and Medicare taxes to only the
vided a reasonable level of living for its
bankruptcy estate. However, you (not
dependent members, you are exempt
country in which you live.
the bankruptcy estate) are responsible
from SE tax if you received IRS appro-
The United States now has social se-
for paying SE tax on your net earnings
val by filing Form 4029. In this case,
curity agreements with the following
from self-employment.
don’t file Schedule SE. Instead, enter
countries: Australia, Austria, Belgium,
Enter on the dotted line to the left of
“Exempt—Form 4029” on Form 1040,
Canada, Chile, Czech Republic, Den-
Schedule SE, line 3, “Chap. 11 bank-
line 57, or Form 1040NR, line 55. See
mark,
Finland,
France,
Germany,
ruptcy income” and the amount of your
Pub. 517 for details.
Greece, Ireland, Italy, Japan, Luxem-
net profit or (loss). Combine that
bourg, the Netherlands, Norway, Poland,
U.S. Citizens Employed by
amount with the total of lines 1a, 1b, and
Portugal, South Korea, Spain, Slovak
2 (if any) and enter the result on line 3.
Foreign Governments or
Republic, Sweden, Switzerland, and the
International Organizations
For other reporting requirements, see
United Kingdom.
Chapter 11 Bankruptcy Cases in the In-
If you have questions about interna-
You must pay SE tax on income you
structions for Form 1040.
tional social security agreements, or to
earned as a U.S. citizen employed by a
More Than One Business
see if any additional agreements have
foreign government (or, in certain cases,
been entered into, you can visit the So-
by a wholly owned instrumentality of a
If you had two or more businesses sub-
cial Security Administration's (SSA's)
foreign government or an international
ject to self-employment tax, your net
International
Programs
website
at
organization under the International Or-
earnings from self-employment are the
ganizations Immunities Act) for services
combined net earnings from all of your
The website also provides contact infor-
performed in the United States, Puerto
businesses. If you had a loss in one busi-
mation for questions about benefits and
Rico, Guam, American Samoa, the
ness, it reduces the income from anoth-
the agreements.
Commonwealth of the Northern Mariana
er. Figure the combined SE tax on one
Islands, or the U.S. Virgin Islands. Re-
If your self-employment income is
Schedule SE.
port income from this employment on
exempt from SE tax, you should get a
Joint Returns
either Short or Long Schedule SE,
statement from the appropriate agency
line 2. If you performed services else-
of the foreign country verifying that
Show the name of the spouse with
where as an employee of a foreign gov-
your self-employment income is subject
self-employment income on Sched-
ernment or an international organization,
to social security coverage in that coun-
ule SE. If both spouses have self-em-
those earnings are exempt from SE tax.
try. If the foreign country will not issue
ployment income, each must file a sepa-
the statement, contact the SSA Office of
Exception—Dual citizens.
A person
rate Schedule SE. However, if one
International Programs. Do not complete
with dual U.S.-foreign citizenship is
spouse qualifies to use Short Sched-
Schedule SE. Instead, attach a copy of
ule SE (front of form) and the other
generally considered to be a U.S. citizen
the statement to Form 1040 and enter
must use Long Schedule SE (back of
for social security purposes. However, if
“Exempt, see attached statement” on
you are a U.S. citizen and also a citizen
form), both can use the same form. One
Form 1040, line 57.
of a country with which the United
spouse should complete the front and the
States has a bilateral social security
other the back.
Nonresident Alien
agreement, other than Canada or Italy,
Include the total profits or losses
your work for the government of that
If you are a self-employed nonresident
from all businesses on Form 1040. Enter
foreign country is always exempt from
alien living in the United States, you
the combined SE tax on Form 1040,
U.S. social security taxes. For further in-
must pay SE tax if an international so-
line 57.
formation about these agreements, see
cial security agreement in effect deter-
Community Income
the exception shown in the next section.
mines that you are covered under the
U.S. social security system. See
Excep-
If any of the income from a business (in-
tion
under U.S. Citizens or Resident Ali-
cluding farming) is community income,
ens Living Outside the United States,
SE-2
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial