Question

The self-employment tax rate is 15.3%. What is included in self-employment tax?
FUTA tax and SUTA tax on net income from self-employment.
Social security tax and FUTA tax on net income from self-employment.
Social security tax and medicare tax on gross income from self-employment.
Social security tax and medicare tax on net income from self-employment.

Answer 1

Social security tax and Medicare tax on net income from self-employment.

Explanation: The 15.3% self-employment tax consists of 12.4% Social Security and 2.9% Medicare, and it applies to your net earnings from self-employment (after allowable business deductions).