Question

Pat generated self-employment income in 2023 of $76,000. What is the self-employment tax?

1) $7,600
2) $15,200
3) $22,800
4) $30,400

Answer 1

The self-employment tax for Pat's self-employment income of $76,000 in 2023 is $11,628.

Step-by-step explanation:

When someone is self-employed, they are responsible for paying both the employer and employee portions of the Social Security and Medicare taxes. This is known as the self-employment tax. In 2023, the self-employment tax rate is 15.3%.

To calculate the self-employment tax, you need to multiply the self-employment income by 15.3%:

$76,000 * 0.153 = $11,628

Therefore, the self-employment tax for Pat would be $11,628.