Type of Deduction:
If you have self-employment income, then you can take a deduction for half of your Self-Employment Tax
. Self-employment income includes any of the following: net profit from Schedules C or F, guaranteed payments from a Partnership, or wages from an S-Corporation.
Your tax deduction for self-employment taxes is limited to one-half of your self-employment tax.
You must be self-employed, and you must have a liability for self-employment taxes.
Where to Claim Deduction:
The deduction for one-half of your self-employment taxes is reported on Form 1040 Line 27. The amount of this line must be half of the amount of self-employment tax shown on Schedule SE and on Form 1040 Line 58.
From the IRS:
"You can deduct half of your SE tax in figuring your adjusted gross income. This deduction only affects your income tax. It does not affect either your net earnings from self-employment or your SE tax." (from "Self-Employment Tax
The rules for self-employment taxes are found in Internal Revenue Code Section 1402
. The deduction for one-half of self-employment tax is found in IRC Section 164(f)