Re: IRS changes my 2005 taxes to \'pro\', charges me self-empl tax
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If you plug the 25k into Schedule SE and multiply net income by .9235 and then by .153, that comes out to $3,500.
If they sent you a letter saying you only owe $2100 then it sounds like you are better off with what they said.
Don’t know how they came up with it.
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1/2 of self-employment tax is deducted from your taxable income (Form 1040, line 29 I think). This doesn't explain the drop from $3500 to $2100 though.
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