Self-Employment Income Law and Legal Definition

According to 26 USCS § 1402 [Title 26. Internal Revenue Code; Subtitle A. Income Taxes; Chapter 2. Tax on Self-Employment Income], self-employment income means “the net earnings from self-employment derived by an individual (other than a nonresident alien individual, except as provided by an agreement under section 233 of the Social Security Act [42 USCS § 433]) during any taxable year; except that such term shall not include--

(1) in the case of the tax imposed by 26 USCS § 1401(a), that part of the net earnings from self-employment which is in excess of (i) an amount equal to the contribution and benefit base (as determined under section 230 of the Social Security Act [42 USCS § 430]) which is effective for the calendar year in which such taxable year begins, minus (ii) the amount of the wages paid to such individual during such taxable years; or

(2) the net earnings from self-employment, if such net earnings for the taxable year are less than $ 400.”