I took a salary reduction to have money designated as Social Security allowance which I received quarterly to pay my Self employment taxes. Is that allowance to be report as income/Salary on line 7 of the 1040 form, or is it excluded.
2Comments
Social Security allowance
DD Fry
We have routinely designated a portion of the pastor's compensation as SECA payment, basically to pay the amount that a typical employer would pay as EE FICA for an employee. That amount is a part of his taxable income. In addition, because there is a tax impact on that amount, we "gross up" the amount to cover the additional SECA amount due.
filing question. . .
LLewis in NC
My understanding is it would be considered income to you and listed on line 7, unlike the housing allowance which would be excluded from line 7.