Self Employment - Independent Contractor Income

As an independent contractor or self-employed individual, you should report your income on Schedule C (Form 1040) Profit or Loss From Business.

Per IRS Instructions for Schedule C, on page C-1:

Use Schedule C (Form 1040) to report income or (loss) from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity, not-for-profit activity, or a hobby does not qualify as a business. To report income from a nonbusiness activity, see the instructions for Schedule 1 (Form 1040), line 8.

Note. It is the responsibility of the taxpayer to report ALL self-employment income, regardless of whether or not a Form 1099-MISC Miscellaneous Income was received.

Per IRS Instructions for Schedule SE Self-Employment Tax, on page SE-1:

Who Must File Schedule SE

You must file Schedule SE if:

  • The amount on line 4c of Schedule SE is $400 or more, or
  • You had church employee income of $108.28 or more. (Income from services you performed as a minister, member of a religious order, or Christian Science practitioner isn't church employee income.) See Employees of Churches and Church Organizations.

To report your self-employment income in the TaxAct® program:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Business Income in the Federal Quick Q&A Topics menu to expand, then click Business income or loss from a sole proprietorship.
  3. Click + Add Schedule C to create a new copy of the form or click Edit to review a form already created.
  4. Continue with the interview process to enter all of the appropriate information.

The filing requirements to determine whether a person must file a federal tax return are based on factors such as the taxpayer's income, the filing status and age of the taxpayer, the age of the spouse on joint returns, if the taxpayer is claimed as a dependent on someone else's return, earnings from self-employment, etc. You may review the IRS Instructions for Form 1040 and 1040-SR for more information.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.