A schedule attached to Form 1040 for small business owners to calculate their self employment tax. Traditionally used by self employed individuals reporting their income on Schedule C, partners who received assigned income on a Schedule K-1, and members of a Limited Liability Company who are assigned active income via Schedule K-1.
The sole proprietorship is taxed at the individual tax level. Basically, the income earned during the calendar year is calculated on Schedule C of Form 1040. The final number is transferred to the front page […]