HHS Stimulus Payment - SE Tax???

Technical topics regarding tax preparation.
#1
FLAcct  
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446
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21-Apr-2014 2:47pm
Location:
Florida
I am working on a 2020 tax return for a doctor who files as a sole proprietor. (He has just recently finished giving me all of the 2020 info I need to finish his return. Worse procrastinator ever!)

Anyways, in April 2020 he received an HHS Stimulus payment. My understanding is that this payment is taxable income, but does he have to pay self-employment tax on this money? Or should I just list it as Other Income on the tax return?

Thanks!
 

#2
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2772
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22-Apr-2014 1:34pm
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North Carolina
My understanding is that this replaced lost revenue, and is treated as such. The one client I had, once I researched, I included it in gross receipts subject to SE tax. This is all I easily found when I googled it now:

https://www.irs.gov/newsroom/frequently ... f-payments
 

#3
MilesR  
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725
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7-Dec-2021 11:10pm
Location:
California
I had an optometrist in the same boat. Subject to SE tax. Also, she effectively had to pay SE tax on the receipt of the ERC too since it reduces wages expense and increases net income.
That's the bummer part of being on Sch C.
 

#4
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267
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23-Jan-2015 11:10pm
Location:
michigan
I have seen nothing declaring that this is not subject to SE tax as, was previously stated, these monies were to replace lost revenue.
 


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