Schedule SE (Form 1040) calculates the Social Security and Medicare tax you owe on self-employment profit. You generally file it when 92.35% of your net self-employment profit is $400 or more, and the form is short: take your Schedule C profit, reduce it to 92.35%, apply 12.4% for Social Security up to the wage base and 2.9% for Medicare on all of it.
This guide walks the 2025 form (the one filed in 2026) line by line, shows how a W-2 job changes the result, and says where each number goes next. Every line number and label below is taken from the IRS 2025 Schedule SE and its instructions. If you only want an estimate of what you will owe, the self-employment tax calculator gives you an estimate; this page is about filling out the form itself.
What Schedule SE is, and who has to file it
Schedule SE is the IRS form that works out self-employment tax — the Social Security and Medicare tax a self-employed person pays in place of the payroll tax an employer would withhold and match. Sole proprietors, single-member LLCs taxed as sole proprietorships, freelancers, independent contractors, gig workers and most general partners use it.
The 2025 Instructions for Schedule SE say you must file it if:
- the amount on line 4c (usually 92.35% of your net self-employment profit) is $400 or more, or
- you had church employee income of $108.28 or more.
Because the $400 test applies after the 92.35% step, it takes about $433 of net profit to reach it. The test is on profit, not revenue: $20,000 of sales with $19,800 of expenses does not trigger it.
Before you start: the numbers you need
- Schedule C, line 31 — your net profit or loss. Finish Schedule C first. (If you farm, you also need Schedule F line 34; if you are a partner, box 14 code A of your Schedule K-1.)
- If you also had a W-2 job: your Social Security wages and tips (boxes 3 and 7 of each W-2), any unreported tips from Form 4137, and any wages from Form 8919. This is the part people get wrong. The Social Security wage base is a single annual limit shared between your W-2 wages and your self-employment earnings, so wages already taxed for Social Security use up room that your self-employment income would otherwise fill.
- Church employee income from a W-2, if a church or qualified church-controlled organization paid you and elected out of payroll taxes.
Part I, line by line
Part I is the standard calculation almost everyone uses. The table follows the 2025 form in order; line 7 changes every year, so check the pre-printed figure on the form for the year you are filing (the IRS 2026 draft shows $184,500).
| Line | What goes there (2025 form) | Where it comes from |
|---|---|---|
| 1a | Net farm profit or loss (Schedule F line 34; farm partnership K-1 box 14 code A) | Farmers only |
| 1b | Conservation Reserve Program payments, only if you receive Social Security benefits | Rare |
| 2 | Net profit or loss from Schedule C line 31 (and non-farm K-1 box 14 code A) | Your Schedule C |
| 3 | Lines 1a + 1b + 2 | Arithmetic |
| 4a | If line 3 is more than zero, line 3 × 92.35% | Arithmetic |
| 4b | Optional-method amounts from Part II (lines 15 and 17) | Usually blank |
| 4c | Lines 4a + 4b. If under $400, stop: no self-employment tax (church employee exception) | Filing threshold |
| 5a / 5b | Church employee income from Form W-2, and 5a × 92.35% (under $100 enter 0) | Rare |
| 6 | Lines 4c + 5b — your net earnings from self-employment | Arithmetic |
| 7 | Maximum earnings subject to Social Security tax — pre-printed $176,100 for 2025 | Printed on the form |
| 8a | W-2 Social Security wages and tips (boxes 3 and 7) and railroad tier 1 compensation | Your W-2(s) |
| 8b | Unreported tips subject to Social Security tax (Form 4137, line 10) | Form 4137 |
| 8c | Wages subject to Social Security tax (Form 8919, line 10) | Form 8919 |
| 8d | Lines 8a + 8b + 8c | Arithmetic |
| 9 | Line 7 − line 8d (if zero or less, enter 0 here and on line 10 and go to line 11) | Remaining wage base |
| 10 | The smaller of line 6 or line 9, × 12.4% — Social Security part | Arithmetic |
| 11 | Line 6 × 2.9% — Medicare part (no cap) | Arithmetic |
| 12 | Lines 10 + 11 — self-employment tax | Goes to Schedule 2, line 4 |
| 13 | Line 12 × 50% — deduction for half of the tax | Goes to Schedule 1, line 15 |
A few details from the instructions that matter in practice:
- Line 8a shortcut. If your W-2 Social Security wages and tips are $176,100 or more for 2025, skip lines 8b through 10 and go to line 11. You have already paid the maximum Social Security tax through your job, so only the 2.9% Medicare part applies.
- Line 9 floor. Line 9 never goes below zero. When it is zero, line 10 is zero.
- Line 4c stop. If line 4c is under $400, you don't owe self-employment tax and can stop, unless you had church employee income.
Worked example: freelancer with and without a day job
Two freelancers each report $60,000 of net profit on Schedule C line 31 for 2025. Freelancer A has no other job. Freelancer B also earns $150,000 of W-2 Social Security wages from a salaried job.
| Line | A: no W-2 wages | B: $150,000 W-2 wages |
|---|---|---|
| Line 2 — Schedule C net profit | $60,000.00 | $60,000.00 |
| Line 4a / 4c / 6 — × 92.35% | $55,410.00 | $55,410.00 |
| Line 7 — wage base (2025) | $176,100 | $176,100 |
| Line 8a / 8d — W-2 Social Security wages | $0 | $150,000.00 |
| Line 9 — line 7 − line 8d | $176,100.00 | $26,100.00 |
| Line 10 — smaller of line 6 or 9, × 12.4% | $6,870.84 | $3,236.40 |
| Line 11 — line 6 × 2.9% | $1,606.89 | $1,606.89 |
| Line 12 — self-employment tax | $8,477.73 | $4,843.29 |
| Line 13 — deductible half | $4,238.87 | $2,421.65 |
Both start the same way: $60,000 × 92.35% = $55,410 of net earnings, and $55,410 × 2.9% = $1,606.89 of Medicare tax. The difference is the Social Security part. Freelancer A has the whole $176,100 wage base available, so all $55,410 is taxed at 12.4%, which is $6,870.84, for a total of $8,477.73. Freelancer B's job already used $150,000 of the wage base, leaving $26,100. Only that $26,100 is taxed at 12.4%, which is $3,236.40, for a total of $4,843.29.
Same profit, $3,634.44 less self-employment tax, purely because of line 8a. Anyone with a salaried job and a side business who skips lines 8a–9 overpays, unless their W-2 Social Security wages already reach the wage base. The Form 1040 instructions let you round to whole dollars, which gives $8,478 and $4,843. Freelancer B's combined wages and self-employment earnings also pass $200,000, so B should check Form 8959 for the Additional Medicare Tax — separately from Schedule SE. Estimates — confirm with your tax professional.
Where the numbers go next
- Line 12 (self-employment tax) goes on Schedule 2 (Form 1040), line 4, and becomes part of your total tax.
- Line 13 (half of line 12) goes on Schedule 1 (Form 1040), line 15, as an adjustment to income. It lowers the income your income tax is calculated on. It does not reduce the self-employment tax itself.
- The 0.9% Additional Medicare Tax is not on Schedule SE. It is figured on Form 8959 when your combined Medicare earnings pass $200,000 (single), $250,000 (married filing jointly) or $125,000 (married filing separately). It is a common mistake to add it on Schedule SE, and an easy one to make if you read "Medicare" on line 11 and assume every Medicare tax lives there.
Self-employment tax is also part of what you should be paying through the year. Our guide to quarterly estimated taxes covers how to include it. If you buy your own health insurance, note that the self-employed health insurance deduction does not reduce the profit Schedule SE taxes.
Part II optional methods: when they apply
Part II offers a farm optional method and a nonfarm optional method. According to the 2025 instructions, they can give you credit toward Social Security coverage in a year with a loss or a small profit, and may help with the earned income credit, the additional child tax credit and the dependent care credit. Both have strict limits. For 2025 the nonfarm method requires net nonfarm profits under $7,840 and under 72.189% of gross nonfarm income, at least $400 of net self-employment earnings in two of the prior three years, and can be used no more than five times; the farm method is capped at $7,240 of reported earnings. The instructions have the full conditions.
Most people never use Part II. ExpenseBot does not support the optional methods: if you intend to elect one, use a tax professional or tax software for Schedule SE.
How ExpenseBot fills in Schedule SE for you
Schedule SE is only as accurate as the Schedule C profit on line 2, and that profit is only as accurate as the expenses you remembered to record. ExpenseBot is an expense tracker that captures receipts from your Gmail and your phone into a Google Sheet in your own Drive and categorizes them for Schedule C, so the net profit comes from a year of records rather than a reconstruction in April.
At year end, the Tax Form Assistant in Year-End has a Schedule SE Details section. You enter W-2 Social Security wages + tips (box 3 + box 7), or tick "I had no W-2 wages or tips subject to Social Security tax", plus any Form 4137 tips, Form 8919 wages and church employee income. ExpenseBot then fills Schedule C and Schedule SE on the official IRS PDF forms, which it has for tax years 2021 through 2025, so you can file them yourself or hand them to your preparer.
The limits, stated plainly: it is for US self-employed filers only (incorporated businesses get a Year-End Expense Summary for their tax professional instead), it does not support Part II optional methods, it does not calculate Form 8959, and it does not file your return. The US expense tracker page covers the rest of the Schedule C workflow, and if you are moving from a side gig to full-time self-employment, our transition guide covers what changes.
Frequently Asked Questions
Who has to file Schedule SE?
Under the 2025 Instructions for Schedule SE, you must file it if line 4c (usually 92.35% of your net self-employment profit) is $400 or more, or if you had church employee income of $108.28 or more. In practice that means roughly $433 or more of net profit ($400 ÷ 0.9235) from self-employment.
Do I need Schedule SE if I also have a W-2 job?
Yes, if your self-employment earnings meet the threshold. Your W-2 Social Security wages and tips go on line 8a. Because the Social Security wage base is shared between wages and self-employment earnings, high W-2 wages reduce the Social Security part of your self-employment tax. The Medicare part is not affected.
What is the 92.35% on Schedule SE?
Line 4a multiplies your net profit by 92.35% before any tax rate applies. It stands in for the employer half of payroll tax that an employee never pays tax on, so self-employed people are taxed on a comparable base. The 12.4% and 2.9% rates then apply to that reduced figure.
Is Schedule SE the same as Schedule C?
No. Schedule C works out your business profit or loss. Schedule SE takes that profit (Schedule C line 31 goes to Schedule SE line 2) and calculates the Social Security and Medicare tax on it. Most sole proprietors with a profit file both.
Where does the Schedule SE deduction go?
For 2025, line 13 (half of your self-employment tax) goes on Schedule 1 (Form 1040), line 15 as an adjustment to income, and line 12 (the tax itself) goes on Schedule 2 (Form 1040), line 4. The deduction lowers your income tax; it does not reduce the self-employment tax itself.
Is the Additional Medicare Tax part of Schedule SE?
No. The 0.9% Additional Medicare Tax is figured on Form 8959. The Schedule SE instructions point to Form 8959 when line 6 of all your Schedules SE, combined with wages where relevant, exceeds $200,000 (single), $250,000 (married filing jointly) or $125,000 (married filing separately).
I made $3,000 from a side gig and have a full-time job. Does my employer's Social Security withholding cover it?
Only the Social Security part, and only if your W-2 Social Security wages already reach the wage base ($176,100 for 2025). Below that, you owe the full 12.4% on your self-employment earnings up to the remaining room, and the 2.9% Medicare part always applies. File Schedule SE and let lines 8a through 10 do the arithmetic. Estimates — confirm with your tax professional.
This guide is educational and describes US federal rules for the 2025 tax year. Line numbers, labels and thresholds are from the IRS 2025 Schedule SE (Form 1040) and the 2025 Instructions for Schedule SE; the 2026 wage base of $184,500 is from the IRS 2026 draft form and the Social Security Administration. Forms change between years, so check the form for the year you file. Estimates — confirm with your tax professional.