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Use Schedule SE (Form 1040) to figure the tax due on net earnings from self-employment. The Social Security Administration uses the information from Schedule SE to figure your benefits under the social security program. This tax applies no matter how old you are and even if you are already getting social security or Medicare benefits.
Maximum income subject to social security tax.
For 2009, the maximum amount of self-employment income subject to social security tax is $106,800.
Optional methods to figure net earnings.
For 2009, the amount of gross and net income from self-employment you may have when using the farm optional method
or nonfarm optional method has increased. Electing taxpayers can secure up to four credits of social security benefits coverage
with $4,360 of net earnings in 2009. See Optional Methods on page SE-4.
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