Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Adjustments to Income

Adjustments to Income

Adjustments to Income (continued)

Self-Employment Tax Deduction

Individuals who do not have a U.S. tax filing requirement, but have self-employment income connected with a trade or business in Puerto Rico:

  • Must file Form 1040 SS (SP) U.S. Self Employment Tax Return or Form 1040 SS U.S. Self Employment Tax Return to report their self-employment income
  • May have to pay self-employment tax

Individuals who have to file a U.S. Individual Income Tax Return and have self-employment income connected with a trade or business in Puerto Rico:

  • Cannot take the self-employment tax deduction on Schedule 1, line 15 because this deduction is related to excluded income
  • File Schedule C and Schedule SE with their U.S. Individual Income Tax Return (Form 1040 or Form 1040-SR)
Adjusted Gross Income section of Schedule 1 with line 15 crossed out.