Discussion:Medical studies subject to self employment tax

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Discussion Forum Index --> Tax Questions --> Medical studies subject to self employment tax

Kiml (talk|edits) said:

31 January 2007
I have a client who participates in several medical studies a year. Is this income subject to self employment tax?

Kevinh5 (talk|edits) said:

31 January 2007
If this rises to the level of a trade or business it would. Otherwise, just line 21 not subject to SE tax. (What would the occupation be? Guinea pig?)

Will "the tax guy" (talk|edits) said:

31 January 2007
I had a client receive a letter from the IRS last year regarding his 2004 taxes and had to pay SE tax on the 1099 he received for similar income. I listed type of business as medical research. The question would be did he incur any expenses that could help reduce the amount of SE tax?

Pegoo (talk|edits) said:

31 January 2007
Well, traveling to and from the medical research center is not deductible :P

Kevinh5 (talk|edits) said:

31 January 2007
Will, I would have fought that one. It could have been hobby income - you know, free drugs and all.

Death&Taxes (talk|edits) said:

31 January 2007
I believe there is a case of a retiree who did something install siding one time to help out; it was not his former occupation nor did he have the skills. I believe the court held him not liable for SE tax. I would have fought Will's also; being a guinea pig is not a business.

1040man (talk|edits) said:

1 February 2007
The people that received this notice were testing Feminine products for Kimberly-Clark

Firm: Maritz Marketing Research d/b/a Quality Controlled Services

It has been determined that, for tax purposes, you are an employee of this firm.

As applicable employment taxes will NOT be withheld, you remain liable under section 3101 and 3401 of the IRS code for the portion that should be withheld from your wages.

FORM 4137, Computation of Social Security Tax on Unreported Tip income, may be used to compute the employee’s portion of the Social Security tax by listing “non-employee income on line “D” of the Tip Information Smart Worksheet for Form 4137.

Unreimbursed employee business expenses are only deductible as a miscellaneous itemized deduction on Schedule A subject to a reduction of 2% of AGI.

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