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paying taxes on AGI of $1752 ? !!?

Forum|Forum|5 years ago
April 11, 2021
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I am a full time student.

I earned W-2 income of $490 from a fast food company.

I had a research assistant job at my school and they issued a 1099-NEC with box 1 nonemployee compensation of $1,000. I earned $89 from doordash, but didn't receive any tax forms.

TurboTax guided me to report the $1,000 and $89 as Schedule C profit and Loss from Business and calculated additonal taxes of $146.

So with an AGI of $1752 I owe taxes of $146.

Is this right? I didn't even think I had to file with that level of income.

l

TurboTax Free Edition Online

Best answer by VolvoGirl

Yes. You don't owe any regular income tax on it but you owe self employment tax. And you have to file if you have $400 of self employment income.

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit (If it is greater than $400). The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare. So you get social security credit for it when you retire.

VolvoGirlAnswer

Employee

Yes. You don't owe any regular income tax on it but you owe self employment tax. And you have to file if you have $400 of self employment income.

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit (If it is greater than $400). The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare. So you get social security credit for it when you retire.

J

JFS4Author

Not the answer I was hoping for but I guess this is what they don't teach you in school. Hope that social security credit is there in 50 years.

Thank you. That helped a lot.

S

SweetieJean

Employee

The non W-2 income (profit) is subject to the approx 15% Unemployment Tax, which is the equivalent of the employer and employee shares of Social Security and Medicare payroll taxes.

And state tax filing requirements may be lower than Federal