Ask Larry

Why Isn't My Full Self-Employment Net Income Shown On My Social Security Earnings Record?

Why is the lesser amount on my SE Tax form of my returns reported to SS for my "benefit income"?
Ex. I am self employed, my net income is $53,660, which gets transferred to the SE Tax form to calculate what I owe for that, and yet the SS benefits website is reporting the LESSER number on that form to calculate my benefits, so they're picking up the $49,555, not the net income of $53,660. Why?

Hi. The lower amount, which should be 92.35% of your net self employment earnings, is the amount on which you actually pay Social Security taxes ( Self-employed people are only required to pay self-employment, or Social Security, taxes on 92.35% of their actual net earnings. Social Security only credits the amount of earnings on which a person pays Social Security taxes, which is why that amount is shown on your Social Security earnings history.

Best, Jerry

Jun 23 2022 - 6:40pm
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