What does self-employment tax mean on the CPA exam?
Self-employment tax. Social Security and Medicare tax paid by someone working for themselves, covering both the employee and employer halves. Half of it is deductible above the line.
Defined against Sec. 1401.
Which CPA exam sections use self-employment tax?
Self-employment tax appears in the REG section of the CPA exam.
Related terms
- kiddie tax: Taxing a child's unearned income above a threshold at the parents' rate, so that income cannot be shifted to a lower bracket by gift.
- regular tax: Tax computed under the ordinary rules, before the alternative minimum tax is considered.
- tentative minimum tax: The alternative minimum tax computed on its own, before comparing it to the regular tax.
- program changes: The IT general control area covering modifications to systems already in production: requested, tested, approved and migrated by someone other than the developer.
- continuing operations: Everything the entity still does, as opposed to a component it has disposed of or classified as held for sale.
- SOC 2 report: A report on a service organization's controls against the trust services criteria, covering security plus any of availability, processing integrity, confidentiality, and privacy that are selected.