Question

Social Security tax on extra income

Forum|Forum|3 years ago
November 29, 2022
1 reply
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In 2020 I made over $200,000 on my regular job. I paid the maximum OASDI of 8537.40.

I did some self employment consulting on the side and made $26,000 (form 1099-C) no employment taxes were taken out.

The 2020 Turbotax program did not add social security on the SE form, only medicare.

The IRS send me a letter demanding an extra $2500 for the unpaid OASDI.

How is self employment OASDI taxed when someone has paid the maximum on their regular job. The person at the IRS helpline did not know.

Thank You.

VolvoGirl

You should be right. Or are you married and the W2 income and Schedule C should be for different spouses? Write the IRS back and explain it is right.

The SE tax includes what you already paid in from your W2s so your schedule SE tax will only be the difference up to the max amount of $8,537.40 for social security. The max income for social security for 2020 is $137,700 between W2 wages and the schedule C Net Profit.

Medicare is 2.9% (both er & ee parts) of all wages & 92.35% Schedule C Net Profit - no max.