SESKStuff Everyone Should Know
SESK: Stuff Everyone Should Know · sesk.info/biz-self-employment-400-rule

At what amount of net self-employment earnings must you pay self-employment tax?

$400 or more in net earnings for the year.

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  1. $600 or more
  2. $400 or more ✔
  3. $10,000 or more

Why: If your net earnings from self-employment are $400 or more, you generally must file and pay self-employment tax. Net means after business expenses. A side hustle can cross this line fast.

Huh, didn't know that: The $400 rule applies even if you are a teen or have a regular job too.

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Why did the baker work overtime? He kneaded the dough.
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References

Answer: $400 or more. If your net earnings from self-employment are $400 or more, you generally must file and pay self-employment tax. Net means after business expenses. A side hustle can cross this line fast.

  1. IRS: Self-employment tax (Social Security and Medicare taxes) www.irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-and-medicare-taxes
    Your net earnings from self-employment (excluding church employee income) were $400 or more.
    Checked 2026-10-11.

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