Barbara is a self-employed rideshare driver for Widget Ride Share. Barbara provided a statement from the ride share company that indicated the amount of mileage driven and fees paid for the year. These fees are considered ordinary and necessary for the ride share business: 5,775 miles driven while transporting customers Ride share fee: $1,200 Safe driver fee: $50 Airport fee: $115 GPS device fee: $120 Her recordkeeping application shows she also drove 3,225 miles between rides and 2,134 miles driven between her home and her first and last customer of the day. Barbara has a separate car for personal use. She bought and started using her second car for business on September 1, 2020. She kept receipts showing she spent $129 on tolls and $960 on gasoline. Barbara also provided the Form 1099-NEC and Form 1099-K that she received from Widget.

1099-NEC

1. Nonemployee Compensation......$3,859

1099-K

1a. Gross amount.....$6,845

3. Number of Transactions....175

What is the total of Barbaras self-employment expenses on Schedule C? a. $4,935 b. $6,789 c. $7,749 d. $8,016

Which of the following statements regarding self-employment tax is false? a. Self-employment tax is Social Security and Medicare taxes collected primarily from individuals who work for themselves, similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. b. The Social Security Administration uses the information from Schedule SE to figure a persons benefits under the Social Security program. c. Taxpayers who are already getting Social Security or Medicare benefits are not required to pay self-employment taxes. d. Taxpayers who do not report all of their self-employment income could cause their Social Security benefits to be lower when they retire.