12 Clever Tax Write Offs for Self Employed People

By Our Editorial Team | Published March 27, 2020

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A senior man looking peaceful while sitting on a porch at sunset. — A content retiree relaxes on his porch at sunset, enjoying the financial peace of mind that Social Security provides.

7. Social Security Payments

When you work for an employer, they deduct Social Security taxes from your paycheck and then match those contributions. They also send taxes to the Internal Revenue Service (IRS) and report your wages.

Self-employed people must report their own earnings and pay taxes directly to the IRS. Thankfully, there are two income tax deductions that can help reduce your taxes. On one hand, your net earnings will be reduced by half the amount of your total Social Security, similarly to how an employer’s share of the Social Security tax would not be considered a wage.

On the other hand, you can also deduct half of your Social Security Tax on IRS Form 1040. Keep in mind that your deduction must be taken from your gross income and it cannot be an itemized deduction, nor can it be listed under Schedule C.

You can find more information on how to treat your Social Security while self-employed by clicking this link.