Self-employment tax (SE tax) is a social security and Medicare tax
for individuals who work for themselves. It is similar to the social
security and Medicare taxes withheld from the pay of wage earners.
You usually have to pay SE tax if you are self-employed. You are
usually self-employed if you operate your own farm on land you either
own or rent. You have to figure SE tax on Schedule SE (Form 1040).
Farmers who have employees may have to pay the employer's share of
social security tax, as well. See chapter 16
for information on
employment taxes.
SE tax rate.
The self-employment tax rate is 15.3%. The rate consists of two
parts: 12.4% for social security (old-age, survivors, and disability
insurance) and 2.9% for Medicare (hospital insurance).
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