Regularly employed people[edit] For 2014, the employee's share of the Social Security portion of the FICA tax is 6.2% of gross compensation up to a limit of $117,000 of gross compensation (resulting in a maximum Social Security tax of $7,254).
You can find more details on how to complete Schedule C in this step-by-step process explanation. How Do I File Schedule C with the IRS? File Schedule C with your Form 1040 after entering your net business income from line 31 of your Schedule C on line 12, Business Income or Loss. This income is included with all other income sources to determine your total adjusted gross income tax liability.
Just to be clear. If you are claiming your expenses on a Schedule C, the IRS requires you to have an income within 5 years. That is an income, not make a profit. If your royalties are $1,000 but you had $2,000 of expenses, you show a loss of $1,000. That is perfectly acceptable because you did have income for your writing. You can show a loss for as long as you are writing, as long as you have income. I never heard of this whole âhobbyâ classification.