Enrolled Agent Exam [Part 1] 25, Self-Employment Tax Calculation

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: • Always multiply net self-employment earnings by 92.35% before applying any tax rates. • The 15.3% SE tax combines a 12.4% Social Security tax up to the wage base limit ($176,100 for 2025) and a 2.9% Medicare tax with no income limit. • The deduction for one-half of the SE tax is an adjustment to income on Schedule 1, not a reduction of the SE tax itself. • W-2 wages count first toward the Social Security limit, reducing the amount of SE income subject to the 12.4% SS tax component. • The 0.9% Additional Medicare Tax is a separate tax for high earners and is not part of the standard 15.3% SE tax calculation. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep