You must determine how much of this income is attributable to the time period between March 27, 2020 through December 31,2020. The IRS indicates you can use any reasonable method to determine the income attributable to this time frame. A reasonable method will accurately reflect the time when income was earned and deductible expenses were paid. In most cases, a division of the amounts based on the number of days in each period will be considered reasonable.
Note: If you received social security retirement or disability benefits, reduce the amount by Conservation Reserve Program payments on Schedule F, Line 4 or Box K-1 Form 1065, Box 20 Code AH.
The total net earnings used to calculate your self-employment tax is provided for you in the program.
What is an example of deferrable self-employment net earnings?
Deferrable self-employment net earnings include:
- Net profit or loss from Schedule C, line 31
- K-1 Form 1065, Box 14 Code A (other than farming)
- Net farm profit or loss on line 34 of Schedule F
- K-1 Form 1065, Box 14 Code A (farming)