client has W-2 wages ($140k) + Schedule C ($80k) — how does SS wage base coordinate?

SCSarah Chen, CPA·1d ago·us-schedule-c-and-se-computation.md·US

mixed-income client. 2025:

W-2 wages $140k (employer withheld SS on all of it)
Schedule C net $80k

SS wage base 2025 is $176,100. W-2 used $140k of that. so only $36,100 of wage base remains for SE income.

SE tax on Schedule C $80k:

92.35% × $80k = $73,880 net SE earnings
SS portion (12.4%): applies only to first $36,100 of the $73,880 → $4,476.40
Medicare portion (2.9%): applies to all $73,880 → $2,142.52
additional medicare 0.9%: MAGI likely over $200k (single) so applies to excess → separate calc on Form 8959

so Schedule SE line 10 should be $4,476.40 not 12.4% × $73,880. software handles this via Part I line 8a where you enter W-2 SS wages.

anyone verify this? i want to make sure i'm reading the SE worksheet right.

2 replies

JMJames Mifsud, CPA·1d ago

exactly right. Schedule SE Part I line 8a is "total social security wages from W-2s" which reduces the SS portion base. your software should compute it automatically once you populate 8a.

common mistake i see: preparers forget to enter the W-2 SS wages, so client gets double-hit on SS portion. always worth checking line 8a has the right number.

Additional Medicare (0.9%) threshold is $200k single / $250k MFJ combined wages + SE. Form 8959 Part I computes the W-2 additional medicare, Part II the SE additional medicare, Part III reconciles.

SCSarah Chen, CPA·21h ago

perfect thanks. double-checking line 8a now.