Why Pay SE Tax?

Social security benefits are available to self-employed persons just as they are to wage earners. Your payments of SE tax contribute to your coverage under the social security system. Social security coverage provides you with retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits.

How to become insured under social secur- ity. You must be insured under the social security system before you begin receiving social security benefits. You are insured if you have the required number of credits (also called “quarters of coverage”).

Earning credits in 2025. You can earn a maximum of four credits per year. For 2025, you earn one credit for each $1,810 of combined wages and self-employment earnings subject to social security tax. You need $7,240 ($1,810 × 4) of combined wages and self-employment earnings subject to social security tax to earn four credits in 2025. It doesn’t matter whether

The SSA time limit for posting self-employ- ment earnings. Generally, the SSA will give you credit only for self-employment earnings reported on a tax return filed within 3 years, 3 months, and 15 days after the tax year you earned the income.

If you file your tax return or report a