Form 1040-SS, U.S. Self-Employment Tax Return

2016

Instructions for Form
1040-SS

Department of the Treasury
Internal Revenue Service

U.S. Self-Employment Tax Return (Including the Additional Child Tax Credit for
Bona Fide Residents of Puerto Rico)
Section references are to the Internal Revenue
Code unless otherwise noted.

General Instructions
Future Developments

For the latest information about
developments related to Form 1040-SS
and its instructions, such as legislation
enacted after they were published, go to
IRS.gov/form1040ss.

What's New
Additional child tax credit (ACTC). If
you are claiming the ACTC on your 2016
Form 1040-SS, and you had a paid
preparer, Form 8867, Paid Preparer's Due
Diligence Checklist, must be attached to
the return. Your preparer must complete
the column corresponding to the ACTC.
Refunds for returns that claim the additional child tax credit (ACTC). If you
are claiming the ACTC on your 2016 Form
1040-SS, and you expect a refund, it will
not be issued before February 15, 2017.
For more information, see IRS.gov/for-taxpros/new-federal-tax-law-may-affectsome-refunds-filed-in-early-2017.
Individual taxpayer identification number (ITIN) renewal. You may need to
renew your ITIN. For more information,
see the Instructions for Form W-7,
Application for IRS Individual Taxpayer
Identification Number.
Maximum income subject to social security tax for 2016. For 2016, the
maximum amount of self-employment
income subject to social security is
$118,500.
Optional methods to figure net earnings. For 2016, the maximum income for
using the optional methods is $5,040.

Reminders
Additional Medicare Tax. You may be
required to pay Additional Medicare Tax.
See the instructions for Part I, Line 5, for
more information. Also, you may need to
report Additional Medicare Tax withheld
by your employer. See the instructions for
Part I, Line 11, for more information.
Maximum income subject to social security tax for 2017. For 2017, the
Dec 29, 2016

maximum amount of self-employment
income subject to social security is
$127,200.

how old you are and even if you already
are receiving social security or Medicare
benefits.

Due date of return. File Form 1040-SS
by April 18, 2017. The due date is April 18,
instead of April 15, because April 15 is on
a Saturday, and April 17 is the
Emancipation Day holiday in the District of
Columbia.

See Who Must File below for additional
uses of this form.

Estimated tax payments. If you expect
to owe self-employment (SE) tax of $1,000
or more for 2017, you may need to make
estimated tax payments. Use Form
1040-ES, Estimated Tax for Individuals, to
figure your required payments and for the
vouchers to send with your payments.
Additional child tax credit. You must
have an SSN (or ITIN), and your qualifying
child must have an SSN, ATIN, or ITIN, by
the due date of your 2016 Form 1040-SS
(including extensions), or you can't claim
the additional child tax credit on either
your original or an amended tax return.
See Identification requirements under Part
II--Bona Fide Residents of Puerto Rico
Claiming Additional Child Tax Credit, later.
Electronic filing. You can e-file Form
1040-SS. For general information about
electronic filing, visit IRS.gov/efile.
Direct Pay. The best way to pay your
taxes is with IRS Direct Pay. It's the safe,
easy, and free way to pay from your
checking or savings account in one online
session. Just click “Pay Your Tax Bill” on
IRS.gov.

Purpose of Form

This form is for residents of the U.S. Virgin
Islands (USVI), Guam, American Samoa,
the Commonwealth of the Northern
Mariana Islands (CNMI), and the
Commonwealth of Puerto Rico (Puerto
Rico) who are not required to file a U.S.
income tax return. Residents of Puerto
Rico who wish to file a return in Spanish
may file Form 1040-PR in place of Form
1040-SS.
One purpose of the form is to report net
earnings from self-employment to the
United States and, if necessary, pay SE
tax on that income. The Social Security
Administration (SSA) uses this information
to figure your benefits under the social
security program. SE tax applies no matter
Cat. No. 26341Y

You may also be required to file an
income tax return with the government of
Guam, American Samoa, the USVI, the
CNMI, or Puerto Rico. Check with your
local tax office for more details.

Who Must File

You must file Form 1040-SS if you meet all
three requirements below.
1. You, or your spouse if filing a joint
return, had net earnings from
self-employment (from other than church
employee income) of $400 or more (or you
had church employee income of $108.28
or more—see Church Employees, later).
However, see Exceptions, later.
2. You do not have to file Form 1040
with the United States.
3. You are a resident of:
a. Guam,
b. American Samoa,
c. The USVI,
d. The CNMI, or
e. Puerto Rico (you can file either
Form 1040-PR (in Spanish) or Form
1040-SS).
Even if you have a loss or little

TIP income from self-employment, it

may benefit you to file Form
1040-SS and use either "optional method"
in Part VI. See Part VI—Optional Methods
To Figure Net Earnings, later.
Exceptions. If (2) and (3) above apply,
you also must file Form 1040-SS (or you
can use Form 1040-PR in Spanish if you
are a resident of Puerto Rico) to:
Report and pay household employment
taxes;
Report and pay employee social
security and Medicare tax on: (a)
unreported tips, (b) wages from an
employer with no social security or
Medicare tax withheld, (c) uncollected
social security and Medicare tax on tips or
group-term life insurance (see the
instructions for Part I, Line 6, later), or (d)
the Additional Medicare Tax (see the
instructions for Part I, Line 5, later).

Claim excess social security tax
withheld;
Claim the additional child tax credit
(bona fide residents of Puerto Rico only),
Claim the health coverage tax credit
(bona fide residents of Puerto Rico only).

Who Must Pay SE Tax
Self-Employed Persons

You must pay SE tax if you had net
earnings of $400 or more as a
self-employed person. If you are in
business (farm or nonfarm) for yourself,
you are self-employed.
You must also pay SE tax on your
share of certain partnership income and
your guaranteed payments. See
Partnership Income or Loss in the
instructions for Part V, later.

Church Employees

If you had church employee income of
$108.28 or more, you must pay SE tax on
that income. Church employee income is
wages you received as an employee
(other than as a minister or member of a
religious order) of a church or qualified
church-controlled organization that has a
certificate in effect electing exemption
from employer social security and
Medicare taxes.
If your only income subject to
self-employment tax is church employee
income, skip lines 1a through 4b in Part V.
Enter “-0-” on line 4c and go to line 5a.

Ministers and Members of
Religious Orders

In most cases, you must pay SE tax on
salaries and other income for services you
performed as a minister, a member of a
religious order who has not taken a vow of
poverty, or a Christian Science
practitioner. But if you filed Form 4361,
Application for Exemption From
Self-Employment Tax for Use by
Ministers, Members of Religious Orders
and Christian Science Practitioners, and
received IRS approval, you will be exempt
from paying SE tax on those net earnings.
If you had no other income subject to SE
tax and do not owe any of the taxes listed
earlier under Who Must File, you aren't
required to file Form 1040-SS. However, if
you had other earnings of $400 or more
subject to SE tax, see Part V, line A.
If you have ever filed Form 2031,
to elect social security coverage
CAUTION on your earnings as a minister,
you cannot revoke that election.

!

If you must pay SE tax, include this
income in Part IV, line 1. But do not report
it in Part V, line 5a; it isn't considered
church employee income.
Also include in Part IV, line 1:

The rental value of a home or allowance
for a home furnished to you (including
payments for utilities), and
The value of meals and lodging
provided to you, your spouse, and your
dependents for your employer's
convenience.
However, do not include in Part IV,
line 1:
Retirement benefits you received from
a church plan after retirement, or
The rental value of or allowance for a
home furnished to you (including
payments for utilities) after retirement.
If you were an ordained minister, a
member of a religious order who has not
taken a vow of poverty, or a Christian
Science practitioner, and were employed
by a church (congregation) for a salary, do
not include that income in Form 1040-SS,
Part IV. Instead, figure your SE tax by
completing Part V, including on line 2 this
income and any rental (parsonage)
allowance or the value of meals and
lodging provided to you. On the same line,
subtract the allowable amount of any
unreimbursed business expenses you
incurred as a church employee. Attach an
explanation.
For details, see Pub. 517.

Members of Recognized
Religious Sects

If you have conscientious objections to
social security insurance because of your
membership in and belief in the teachings
of a religious sect recognized as being in
existence at all times since December 31,
1950, and which has provided a
reasonable level of living for its dependent
members, you can request exemption
from SE tax by filing Form 4029,
Application for Exemption From Social
Security and Medicare Taxes and Waiver
of Benefits. If you filed Form 4029 and
have received IRS approval, do not file
Form 1040-SS. See Pub. 517 for details.

Employees of Foreign
Governments or International
Organizations

You must pay SE tax on income you
earned as a U.S. citizen or a resident of
Puerto Rico employed by a foreign
government (or, in certain cases, by a
wholly owned instrumentality of a foreign
government or an international
organization under the International
Organizations Immunities Act) for services
performed in the United States, Puerto
Rico, Guam, American Samoa, the USVI,
or the CNMI. Report income from this
employment on Part IV, line 1. Enter the
net amount from Part IV, line 27, on Part V,
line 2. If you performed services
elsewhere as an employee of a foreign
government or an international
SS-2

organization, those earnings are exempt
from SE tax.

Commonwealth or Territory
Residents Living Abroad

Generally, if you are a resident of Guam,
American Samoa, the USVI, the CNMI, or
Puerto Rico living abroad, you must pay
SE tax.
Exception. The United States has social
security agreements with many countries
to eliminate dual taxes under two social
security systems. Under these
agreements, you must generally pay
social security and Medicare taxes only to
the country you live in.
If you have questions about
international social security agreements,
you can:
1. Visit the SSA International
Programs website at
www.socialsecurity.gov/international;
2. Call the SSA Office of International
Programs if you speak English at
410-965-3322 (not toll free) for questions
about the agreements; or
3. Write to: Social Security
Administration, Office of International
Programs, P.O. Box 17741, Baltimore, MD
21235-7741 USA. (Do not send Form
1040-SS to this address. Instead, see
Where To File, later.)
Even if you do not have to pay SE
tax because of a social security
CAUTION agreement, you may still have to
file a tax return with the Internal Revenue
Service.

!

Chapter 11 Bankruptcy Cases

While you are a debtor in a Chapter 11
bankruptcy case, your net profit or loss
from self-employment will be included on
the income tax return (Form 1041) of the
bankruptcy estate. However, you—not the
bankruptcy estate—are responsible for
paying self-employment tax on your net
earnings from self-employment.
Enter on the dotted line next to line 3 of
Form 1040-SS, Part V, “Chap. 11
bankruptcy income” and the amount of
your net profit or (loss). Combine that
amount with the total of lines 1a, 1b, and 2
(if any) and enter the result on line 3.
For other reporting requirements, see
the Instructions for Form 1040.

More Than One Business

If you were a farmer and had at least one
other business or you had two or more
nonfarm businesses, your net earnings
from self-employment are the combined
net earnings from all of your businesses. If
you had a loss in one business, it reduces
the income from another. Complete and
file only one Form 1040-SS for any 1 year.
Attach a separate Part III or Part IV for
Instructions for Form 1040-SS (2016)

each trade or business, and combine the
net earnings in a single Part V.
Joint returns. If both you and your
spouse have self-employment income
from separate farm or nonfarm
businesses, each of you must complete
and file a separate Part III or Part IV. Be
sure to enter at the top of each Part III or
Part IV the name and SSN of the spouse
who owns the business. Each of you must
also complete a separate Part V. Attach
these pages to a single Form 1040-SS.

Business Owned and
Operated by Spouses

If you and your spouse jointly own and
operate an unincorporated farm or
nonfarm business and share in the profits
and losses, you are partners in a
partnership, whether or not you have a
formal partnership agreement. Do not use
Part III or Part IV. Instead, file the
appropriate partnership return.
Exception—Qualified joint venture
(QJV).
If you and your spouse materially
participate (see Material participation in
the 2016 Instructions for Schedule C
(Form 1040)) as the only members of a
jointly owned and operated business, and
you file a joint Form 1040-SS for the tax
year, you can make a joint election to be
taxed as a QJV instead of a partnership.
To make this election, you must divide all
items of income, gain, loss, deduction,
and credit attributable to the business
between you and your spouse in
accordance with your respective interests
in the venture. Each of you must file a
separate Part III or Part IV, as well as a
separate Part V. On each line of your
separate Part III or Part IV, you must enter
your share of the applicable income,
deduction, or loss. For complete
information on this election, see the 2016
Instructions for Schedule E (Form 1040).
For more information on QJVs, go to
IRS.gov and enter “qualified joint venture”
in the search box.
Rental real estate business. If you
and your spouse make the election for
your rental real estate business, the
income generally isn't subject to SE tax
(for an exception, see item 3 under Other
Income and Losses Included in Net
Earnings From Self-Employment in the
instructions for Part V, later).
If the election is made for a farm rental
business that isn't included in
self-employment, the income isn't subject
to SE tax. Do not include the income on
Form 1040-SS. Depending on the source
of the income (possession, U.S. source, or
other foreign source), you may need to file
other tax forms. See Pub. 570, and Form
4835, for more information.
Instructions for Form 1040-SS (2016)

Exception—Community income. If you
and your spouse wholly own an
unincorporated business as community
property under the community property
laws of a state, foreign country, or U.S.
possession, the income and deductions
are reported based on the following.
If only one spouse participates in the
business, all of the income from that
business is the self-employment earnings
of the spouse who carried on the
business.
If both spouses participate, the income
and deductions are allocated to the
spouses based on their distributive
shares.
If either or both you and your spouse
are partners in a partnership, see
Partnership Income or Loss in the
instructions for Part V, later.
If you and your spouse elected to treat
the business as a QJV, see
Exception—Qualified joint venture (QJV),
earlier.

When To File

If you file on a calendar year basis, file by
April 18, 2017.
If you file on a fiscal year basis, file by
the 15th day of the 4th month after the
close of your fiscal year.

Extension of Time To File

If you can't file Form 1040-SS by the due
date, you can get an extension of time to
file the form. In some cases, you can get
an extension of time to file and pay any tax
due.
Bona fide residents of Puerto Rico.
You can apply for an automatic 6-month
extension of time to file Form 1040-SS
(until October 16, 2017, for calendar year
taxpayers). To get this automatic
extension, you must file Form 4868, by the
regular due date of your return (April 18,
2017, for calendar year taxpayers). You
can file Form 4868 either by paper or
electronically through IRS e-file. For
details, see the instructions on Form 4868.
This 6-month extension to file
does not extend the time to pay
CAUTION your tax. Any interest due on
unpaid taxes is calculated from the original
due date of the return.

!

Bona fide residents of American Samoa, the CNMI, Guam, or the USVI.
You can apply for the automatic 6-month
extension described above, or you can
receive an automatic 2-month extension
and then apply for an additional 4-month
extension if you still need more time.
Automatic 2-month extension. You
are allowed an automatic 2-month
extension to file your return and pay your
tax if you are outside the United States
and Puerto Rico on the day Form 1040-SS
SS-3

is due (April 18, 2017, for calendar year
taxpayers). Although you have an
extension of time to pay your tax, interest
on any unpaid tax will be charged from the
original due date of the return.
To get this automatic extension, you
must file Form 1040-SS by the extended
due date (June 15, 2017, for calendar year
taxpayers) and attach a statement
explaining that on the regular due date of
your return you were a bona fide resident
of American Samoa, the CNMI, Guam, or
the USVI.
Additional 4-month extension. If you
can't file your return within the automatic
2-month extension period, you generally
can get an additional 4 months to file your
return, for a total of 6 months. File Form
4868 by the new due date allowed by the
2-month extension (June 15, 2017, for
calendar year taxpayers). Follow the
instructions for completing Form 4868,
and be sure to check the box on line 8.
Unlike the original 2-month extension,
the additional 4 months of time to file is
not an extension of time to pay. You must
make an accurate estimate of your tax
based on the information available to you.
If you find you can't pay the full amount
due with Form 4868, you can still get the
extension. You will owe interest on the
unpaid amount from the original due date
of the return.
Where to file extension requests.
If you are enclosing a payment, send Form
4868 with your payment to:
Department of the Treasury
Internal Revenue Service
P.O. Box 1302
Charlotte, NC 28201-1302
If you aren't enclosing a payment, send
Form 4868 to:
Department of the Treasury
Internal Revenue Service
Austin, TX 73301-0045

Where To File

If you are enclosing a check or money
order, send your Form 1040-SS to:
Department of the Treasury
P. O. Box 1303
Charlotte, NC 28201-1303
If you aren't enclosing a check or
money order, send your Form 1040-SS to:
Department of the Treasury
Internal Revenue Service
Austin, TX 73301-0215

Specific Instructions
Fiscal Year Filers

If your tax year is a fiscal year, use the tax
rate and earnings base that apply at the
time the fiscal year begins. Do not prorate
the tax or earnings base for a fiscal year
that overlaps the date of a rate or earnings
base change.

Name and SSN

To ensure proper credit to your social
security account, enter your name and
social security number (SSN), and your
spouse's if filing a joint return, exactly as
shown on your social security card. If you
do not have an SSN, get Form SS-5,
Application for a Social Security Card,
from an SSA district office or online at
www.socialsecurity.gov/online/ss-5.html.

Part I—Total Tax and
Credits
Line 1

Check the filing status that applies to you.
Single. Your filing status is single if:
1. On the last day of the year, you are
unmarried or legally separated from your
spouse under a divorce or separate
maintenance decree, or
2. You meet all of the following
conditions.
a. You lived apart from your spouse
for the last 6 months of 2016. Temporary
absences for special circumstances, such
as business, medical care, school, or
military service, count as time lived in the
home.
b. You file a separate return from your
spouse.
c. You paid over half the cost of
keeping up your home for 2016.
d. Your home was the main home of
your child, adopted child, stepchild, or
eligible foster child for more than half of
2016. Temporary absences by you or the
child for special circumstances, such as
school, vacation, business, medical care,
military service, or detention in a juvenile
facility, count as time lived in the home.
Also, a child is considered to have lived
with you for more than half of 2016 if the
child was born or died in 2016 and your
home was the child's home for more than
half of the time he or she was alive.
e. If you filed Form 1040, you could
claim the child as your dependent or could
claim the child except that the child's other
parent can claim the child under the rules
for children of divorced or separated
parents (see Pub. 501).

end of 2016 and both you and your
spouse agree to file a joint return. You can
also choose this filing status if your
spouse died in 2016 and you did not
remarry in 2016.
If you choose to file a joint return, check
the box for married filing jointly and be
sure to include your spouse's name and
SSN on the lines provided below your
name and SSN. If your spouse also had
self-employment income, complete and
attach a separate Part V and, if applicable,
Part VI. If necessary, attach a separate
Part III or Part IV for your spouse's farm or
nonfarm business.
Joint and several tax liability. If you
file a joint return, both you and your
spouse generally are responsible for the
tax and any interest or penalties due on
the return. This means that if one spouse
doesn't pay the tax due, the other may
have to.
However, you may qualify for relief
from an existing tax liability on your joint
return if:
There is an understatement of the
amount of tax because your spouse
omitted income or claimed false
deductions or credits;
You are divorced, separated, or no
longer living with your spouse; or
Given all the facts and circumstances, it
would not be fair to hold you liable for the
tax.
File Form 8857 to request relief. Some
requests for relief may need to be filed
within two years of the date on which the
IRS first attempted to collect the tax from
you. For more information, see Pub. 971,
and Form 8857 or call the Innocent
Spouse office at 1-855-851-2009 (toll free
except in American Samoa).
Married filing separately. You can
choose this filing status if you were
married at the end of 2016. This method
may benefit you if you want to be
responsible only for your own tax.

Line 4

If either of the following applies, see
Schedule H (Form 1040), and its
instructions to find out if you owe these
taxes.
You paid any one household employee
cash wages of $2,000 or more in 2016.
You paid total cash wages of $1,000 or
more in any calendar quarter of 2015 or
2016 to all household employees.

Line 5

Enter the total Additional Medicare Tax
from line 18 of Form 8959 on line 5. Attach
Form 8959. See Form 8959 and the
Instructions for Form 8959 for more
information.

Married filing jointly. You can choose
this filing status if you were married at the
SS-4

Line 6

Include the following taxes in the line 6
total.
Employee social security and Medicare tax on tips not reported to employer. Complete Form 4137 if you
received cash and charge tips of $20 or
more in a calendar month and did not
report all of those tips to your employer.
On the dotted line next to line 6, enter “Tax
on Tips,” and the amount of tax due (from
Form 4137, line 13). Be sure to include
this tax in the total for line 6. Attach to
Form 1040-SS the completed Form 4137.
Uncollected employee social security
and Medicare tax on tips. If you did not
have enough wages to cover the social
security and Medicare tax due on tips you
reported to your employer, the amount of
tax due should be identified with codes A
and B in box 12 of your Form W-2AS,
W-2CM, W-2GU, or W-2VI; or entered in
boxes 22 and 23 of your Form 499R-2/
W-2PR. Include this tax in the total for
line 6. Enter the amount of this tax and
“Uncollected Tax” on the dotted line next
to line 6.
Uncollected employee social security
and Medicare tax on group-term life insurance. If you had group-term life
insurance through a former employer, you
may have to pay social security and
Medicare tax on part of the cost of the life
insurance. The amount of tax due should
be identified with codes M and N in box 12
of your Form W-2AS, W-2CM, W-2GU, or
W-2VI. If you are a bona fide resident of
Puerto Rico, contact your employer for this
amount. Include this tax in the total for
line 6. Enter the amount of this tax and
“Uncollected Tax” on the dotted line next
to line 6.
Uncollected employee social security
and Medicare tax on wages. If you are
an employee who received wages from an
employer who did not withhold social
security and Medicare tax from your
wages, complete Form 8919 to figure your
share of the unreported tax. Enter the
amount of tax due (from Form 8919,
line 13) and “Uncollected Tax” on the
dotted line next to line 6, and include this
tax in the total for line 6. Attach to Form
1040-SS the completed Form 8919.

Line 7

Enter any estimated tax payments you
made for 2016 including any overpayment
from your 2015 return that you applied to
your 2016 estimated tax. If you or your
spouse paid separate estimated tax but
are now filing a joint return, add the
amounts you each paid and enter the total
on line 7. If you and your spouse paid joint
estimated tax but are now filing separate
returns, you can divide the amount paid in
any way you choose as long as you both
Instructions for Form 1040-SS (2016)

agree. If you can't agree, you must divide
the payments in proportion to each
spouse's individual tax as shown on your
separate returns for 2016. For an example
of how to do this, see Pub. 505.

Line 8

If you, or your spouse if filing a joint return,
had more than one employer for 2016,
and total wages of more than $118,500,
too much social security tax may have
been withheld. You can take a credit on
this line for the amount withheld in excess
of $7,347.00. But if any one employer
withheld more than $7,347.00, you must
ask that employer to refund the excess to
you. You can't claim it on Form 1040-SS.
Figure this amount separately for you and
your spouse. You must attach Forms
W-2AS, W-2CM, W-2GU, W-2VI, or
499R-2/W-2PR. See Pub. 505 for more
information.

Line 10

If, during 2016, you were a bona fide
resident of Puerto Rico and an eligible
trade adjustment assistance (TAA)
recipient, alternative TAA (ATAA)
recipient, reemployment trade adjustment
assistance (RTAA) recipient, Pension
Benefit Guaranty Corporation (PBGC)
payee, or qualifying family member, see
the 2016 Form 8885, and its instructions
to figure the amount of your credit, if any.
See chapter 1 of Pub. 570, for the bona
fide residency rules.

Line 11

Add lines 7 through 10. Enter the total on
line 11.
Additional Medicare Tax withheld. If
you had Additional Medicare Tax withheld
by your employer in 2016, include the
amount shown on Form 8959, line 24, in
the total for line 11. On the dotted line next
to line 11, enter “Form 8959” and show the
amount. Attach Form 8959. See Form
8959 and the Instructions for Form 8959
for more information.
Amount paid with request for extension of time to file. If you got an
automatic extension of time to file Form
1040-SS by filing Form 4868 or by making
a payment, enter the amount of the
payment or any amount you paid with
Form 4868. If you paid by credit or debit
card, do not include on line 11 the
convenience fee you were charged. On
the dotted line next to line 11, enter “Form
4868” and show the amount paid.

Lines 13a Through 13d

If you want us to directly deposit the
amount shown on line 13a to your
checking or savings account at a U.S.
bank or other U.S. financial institution
(such as a mutual fund, brokerage firm, or
credit union):
Instructions for Form 1040-SS (2016)

Check the box on line 13a and attach
Form 8888, if you want to split the direct
deposit of your refund into more than one
account or use all or part of your refund to
buy paper Series I savings bonds; or
Complete lines 13b through 13d if you
want your refund deposited to only one
account.
If you do not want your refund directly
deposited to your account, do not check
the box on line 13a. Draw a line through
the boxes on lines 13b and 13d. We will
send you a check instead.
The IRS isn't responsible for a lost
refund if you enter the wrong
CAUTION account information. Check with
your financial institution to make sure your
direct deposit will be accepted and to get
the correct routing and account numbers.

!

Do not request a deposit of your refund
to an account that isn't in your name (such
as your tax preparer's own account).
If you file a joint return and check
the box on line 13a and attach
CAUTION Form 8888 or fill in lines 13b
through 13d, your spouse may get at least
part of the refund.

!

TreasuryDirect®. You can request a
deposit of your refund (or part of it) to a
TreasuryDirect® online account to buy
U.S. Treasury marketable securities and
savings bonds. For more information, go
to www.treasurydirect.gov.
Form 8888. You can have your refund
directly deposited into more than one
account or use it to buy up to $5,000 in
paper Series I savings bonds. You do not
need a TreasuryDirect® account to do
this. See the Instructions for Form 8888 for
more details.

your deposit is accepted. For a
TreasuryDirect® online account, check
the “Savings” box.

Line 13d
The account number can be up to 17
characters (both numbers and letters).
Include hyphens but omit spaces and
special symbols. Enter the number from
left to right and leave any unused boxes
blank. Do not include the check number.
If the direct deposit to your account(s)
is different from the amount you expected,
you will receive an explanation in the mail
about 2 weeks after your refund is
deposited.
If you are asking to have a joint
refund deposited to an individual
CAUTION account and your financial
institution(s) won’t allow this, your direct
deposit will be rejected back to the IRS.
The IRS isn’t responsible if a financial
institution rejects a direct deposit.

!

Line 14

Enter on line 14 the amount, if any, of the
overpayment on line 12 you want applied
to your 2017 estimated tax. The election to
apply part or all of the overpaid amount to
your 2017 estimated tax can't be changed
later.

Amount You Owe
To avoid interest and penalties,

TIP pay your taxes in full by April 18,

2017. You do not have to pay if
line 15 is under $1.

Do not include any estimated tax payment
for 2017 in this payment. Instead, make
the estimated tax payment separately.

Line 15—Amount You Owe

Line 13b
The routing number for your financial
institution must be nine digits. The first two
digits must be 01 through 12 or 21 through
32. Otherwise, the direct deposit will be
rejected and a check sent instead.

IRS offers several payment options. You
can pay online, by phone, mobile device,
cash (maximum $1000 per day and per
transaction), check, or money order. Go to
IRS.gov/payments for payment options.

Ask your financial institution for the
correct routing number to enter on line 13b
if:
The routing number on a deposit slip is
different from the routing number on your
checks,
Your deposit is to a savings account
that doesn't allow you to write checks, or
Your checks state they are payable
through a financial institution different from
the one at which you have your checking
account.

Pay Online

Line 13c
Check the appropriate box for the type of
account. Do not check more than one box.
You must check the correct box to ensure
SS-5

IRS offers an electronic payment option
that is right for you. Paying online is
convenient and secure and helps make
sure we get your payments on time. To
pay your taxes online or for more
information, go to IRS.gov/payments. You
can pay using any of the following
methods.
IRS Direct Pay for online transfers
directly from your checking or savings
account at no cost to you, go to IRS.gov/
payments.
Pay by Card. To pay by debit or credit
card go to IRS.gov/payments. A
convenience fee is charged by these
service providers.

Electronic Funds Withdrawal (EFW)
is an integrated e-file/e-pay option offered
when filing your federal taxes
electronically using tax preparation
software, through a tax professional, or
the IRS at IRS.gov/payments.
Online Payment Agreement. If you
cannot pay in full by the due date of your
tax return you can apply for an online
monthly installment agreement at IRS.gov/
payments. Once you complete the online
process, you will receive immediate
notification of whether your agreement has
been approved. A user fee is charged.
IRS2Go is the mobile application of the
IRS; you can access Direct Pay or Pay By
Card by downloading the application.

Pay by Phone
Paying by phone is another safe and
secure method of paying electronically.
Use one of the following methods:
1. Call one of the debit or credit card
service providers, or
2. Use the Electronic Federal Tax
Payment System (EFTPS).
Debit or credit card. Call one of our
service providers. Each charges a fee that
varies by provider, card type, and
payment amount.
Link2Gov Corporation
1-888-PAY-1040TM
(1-888-729-1040)
PAY1040.com
WorldPay US, Inc.
1-844-PAY-TAX-8TM
(1-844-729-8298)
PayUSAtax.com
EFTPS. To use EFTPS, you must be
enrolled either online or have an
enrollment form mailed to you. To make a
payment using EFTPS, call
1-800-555-4477 (English) or
1-800-244-4829 (Español). People who
are deaf, hard of hearing, or have a
speech disability and who have access to
TTY/TDD equipment can call
1-800-733-4829. For more information
about EFTPS, go to IRS.gov/payments or
www.eftps.gov.

Mobile Device
To pay through your mobile device,
download the IRS2Go app.

Pay by Check or Money Order
Before submitting a payment through the
mail, please consider alternative methods.
One of our safe, quick, and easy
electronic payment options might be right
for you. If you choose to mail a tax
payment make your check or money order

payable to “United States Treasury” for the
full amount due. Do not send cash. Do not
attach the payment to your return. Write
“2016 Form 1040-SS,” your name,
address, daytime phone number, and
social security number (SSN) on your
payment. If you are filing a joint return,
enter the SSN shown first on your tax
return.
To help us process your payment,
enter the amount on the right side of the
check like this: $ XXX.XX. Do not use
dashes or lines (for example, do not enter
“$ XXX–” or “$ XXXxx 100”).
Mail your 2016 Form 1040-SS and
payment to the address shown under
Where To File, earlier.
Bad check or payment. The penalty for
writing a bad check to the IRS is $25 or
2% of the check, whichever is more.
However, if the amount of the check is
less than $25, the penalty equals the
amount of the check. This penalty also
applies to other forms of payment if the
IRS doesn't receive the funds. See Tax
Topic 206 at IRS.gov/taxtopics.

What If You Can't Pay?
If you can't pay the full amount shown on
line 15 when you file, you can ask for:
An installment agreement, or
An extension of time to pay.
Installment agreement. Under an
installment agreement, you can pay all or
part of the tax you owe in monthly
installments. However, even if an
installment agreement is granted, you will
be charged interest and may be charged a
late payment penalty on the tax not paid
by April 18, 2017. You must also pay a
fee. To limit the interest and penalty
charges, pay as much of the tax as
possible when you file. But before
requesting an installment agreement, you
should consider other less costly
alternatives, such as a bank loan or credit
card payment.
To ask for an installment agreement,
you can apply online or use Form 9465.
To apply online, go to Apply for an Online
Payment Agreement.
Extension of time to pay. If paying the
tax when it is due would cause you an
undue hardship, you can ask for an
extension of time to pay by filing Form
1127 by April 18, 2017. An extension
generally won't be granted for more than 6
months. You will be charged interest on
the tax not paid by April 15, 2017. You
must pay the tax before the extension runs
out. Penalties and interest will be imposed
until taxes are paid in full. For the most
up-to-date information on Form 1127, go
to IRS.gov/form1127.

SS-6

Part II—Bona Fide
Residents of Puerto Rico
Claiming Additional Child
Tax Credit

If you were a bona fide resident of Puerto
Rico for the tax year and you qualify to
claim the additional child tax credit, you
must list each qualifying child (defined
later) in Part I, line 2. Also complete Part II
and the Additional Child Tax Credit
Worksheet—Part II, Line 3, later, to figure
the amount of your credit.

!

CAUTION

You must have three or more
qualifying children to claim the
additional child tax credit.

Qualifying for the Credit

You may be able to claim the additional
child tax credit for 2016 if all of the
following apply.
You were a bona fide resident of Puerto
Rico (see Pub. 570).
Social security and Medicare taxes
were withheld from your wages or you
paid SE tax.
You, or your spouse if filing a joint
return, can't be claimed as a dependent
on someone else's U.S. income tax return.
You had three or more qualifying
children (defined below).
Qualifying child. A qualifying child for
purposes of the additional child tax credit
is a child who:
1. Is your son, daughter, stepchild,
foster child, brother, sister, stepbrother,
stepsister, half brother, half sister, or a
descendant of any of them (for example,
your grandchild, niece, or nephew). A
foster child is any child placed with you by
an authorized placement agency or by a
judgment, decree, or other order of any
court of competent jurisdiction.
Note. Your adopted child is always
treated as your own child. A child lawfully
placed for legal adoption is treated the
same as an adopted child.
2. Was under 17 at the end of 2016.
3. Was younger than you (or your
spouse, if filing jointly) or was permanently
and totally disabled (see Age Test in Pub.
501).
4. Did not provide over half of his or
her own support for 2016.
5. Lived with you for more than half of
2016. If the child did not live with you for
the required time, see Residency Test in
Pub. 501.
6. Is not filing a joint return for 2016 or
is filing a joint return for 2016 only to claim
a refund of estimated or withheld taxes.
See examples under Joint Return Test (To
Be a Qualifying Child) in Pub. 501.
7. Was a U.S. citizen, U.S. national, or
a U.S. resident alien.
Instructions for Form 1040-SS (2016)

Note. If you are a U.S. citizen or U.S.
national and your adopted child lived with
you all year as a member of your
household, that child meets an exception
and may be a qualifying child although the
child is a nonresident alien.
Information about your qualifying
child. In Part I, line 2, enter each
qualifying child's name, identifying number
(SSN, ITIN or ATIN), and relationship to
you. If you have more than six qualifying
children, attach a statement to Form
1040-SS with the required information. If
the child meets the conditions to be a
qualifying child of any other person (other
than your spouse if filing jointly) for 2016,
see Qualifying Child of More Than One
Person in Pub. 501.
Identification requirements. If you
didn't have an SSN (or ITIN), by the due
date of your 2016 Form 1040-SS
(including extensions), you can't claim the
additional child tax credit on either your
original or an amended 2016 Form
1040-SS, even if you later get an SSN (or
ITIN). Also, no additional child tax credit is
allowed on your original or an amended
2016 Form 1040-SS with respect to a
qualifying child who didn't have an SSN,
ATIN, or ITIN by the due date of your 2016
Form 1040-SS (including extensions),
even if that child later gets one of those
numbers.

Line 1

For purposes of figuring the additional
child tax credit, you must report all of your
income derived from sources within
Puerto Rico that is excluded from U.S. tax
because you were a bona fide resident of
Puerto Rico. This includes items such as
wages, interest, dividends, taxable
pensions and annuities, and taxable social
security benefits. Also include any profit or
(loss) from Part III, line 36, and Part IV,
line 27. For more information on these and
other types of income to include on line 1,
see the Form 1040 instructions. See Pub.
570, for the rules to use in determining
your Puerto Rico source income.

Line 2

Enter the amount of withheld social
security, Medicare, and Additional
Medicare taxes from Puerto Rico Form(s)
499R-2/W-2PR, boxes 18 and 20. If
married filing jointly, include your spouse’s
amounts with yours.

Line 3

Use the Additional Child Tax Credit
Worksheet to figure your additional child
tax credit. If your employer withheld or you
paid Additional Medicare Tax, see Form
8959, and the Instructions for Form 8959.

Instructions for Form 1040-SS (2016)

Part III—Profit or Loss
From Farming

For assistance with Part III (Profit or Loss
From Farming), see the 2016 Instructions
for Schedule F (Form 1040), and Pub.
225.

Accounting Methods

The accounting method you used to
record your farm income determines
whether you complete, in addition to
Section B, Section A or C.
Cash method. Include in income both
the cash actually or constructively
received and the fair market value of
goods or other property you received.
Generally, you deduct your expenses
when you pay them.
Accrual method. Include your income in
the year you earned it. It doesn't matter
when you get it. Deduct your expenses
when you incur them.

Section A or C—Sales of
Livestock

Form 4797 is used to report sales of
livestock held for draft, breeding, sport, or
dairy purposes, and is attached to Form
1040. This income is taxable, but isn't
subject to SE tax. You should check to see
if this additional amount of gross income
will require you to file Form 1040 instead
of Form 1040-SS.

Line 12

If you claim any car or truck expenses
(actual or the standard mileage rate), you
must provide the information requested in
Part V of Form 4562. Be sure to attach
Form 4562 to your return.

Line 34

List your other expenses and the amounts
on lines 34a through 34e. If you cannot
enter all of the expenses on lines 34a
through 34e, enter the first four expenses
on lines 34a through 34d. On line 34e,
enter "Other" and the total of the expenses
not already included on lines 34a through
34d.

Part IV—Profit or Loss
From Business (Sole
Proprietorship)

For assistance with Part IV (Profit or Loss
From Business (Sole Proprietorship)), see
the 2016 Instructions for Schedule C
(Form 1040), Profit or Loss From
Business, and Pub. 334.

Line 7

If you claim any car or truck expenses
(actual or the standard mileage rate), you
must provide the information requested in
Part V of Form 4562. Be sure to attach
Form 4562 to your return.
SS-7

Line 25a

List your other expenses and the amounts
on line 25a. If you cannot enter all of your
other expenses on the lines provided,
enter "Other" and the total of the expenses
not already listed on line 25a on the last
line under line 25a. Combine the amounts
reported on line 25a and enter the total on
line 25b.

Part V—Self-Employment
Tax
If you are filing a joint return and
both you and your spouse have
CAUTION income subject to SE tax, you
must each complete a separate Part V.
This includes those who made a joint
election to be taxed as a QJV.

!

What Is Included in Net
Earnings From
Self-Employment

Generally, net earnings include your net
profit from a farm or nonfarm business. If
you were a partner in a partnership, see
the following instructions.

Partnership Income or Loss
When figuring your total net earnings from
self-employment, include your share of
partnership income or loss attributable to a
trade or business and any guaranteed
payments for services or the use of
capital. However, if you were a limited
partner, include only guaranteed
payments for services you actually
rendered to or on behalf of the
partnership.
If you were a general partner, reduce
lines 1a and 2 of Part V for any section
179 expense deduction, oil or gas
depletion, and unreimbursed partnership
expenses. Attach an explanation of these
deductions.
If your partnership was engaged solely
in the operation of a group investment
program, earnings from the operation
aren't self-employment earnings for either
the general or limited partners.
If a partner died and the partnership
continued, include in self-employment
income the deceased partner's distributive
share of the partnership's ordinary income
or loss through the end of the month in
which he or she died. See section 1402(f).
If you were married and both you and
your spouse were partners in a
partnership, each of you must report your
net earnings from self-employment from
the partnership. Each of you must
complete a separate Part V. If only one of
you was a partner in a partnership, the
spouse who was the partner must pay SE

Additional Child Tax Credit Worksheet—Part II, Line 3

Keep for Your Records

1. Do you have three or more qualifying children?
No. Stop. You can't claim the credit.
Yes. Go to line 2.
2. Number of qualifying children: _______ × $1,000. Enter the result . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. Enter the amount from Part II, line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.

4. Enter the amount shown below for your filing status . . . . . . . . . . . . . . . . . . . . . . . .

4.

2.

• Married filing jointly — $110,000
• Single — $75,000
• Married filing separately — $55,000
5. Is the amount on line 3 more than the amount on line 4?
No. Leave line 5 blank. Enter -0- on line 6, and go to line 7.
Yes. Subtract line 4 from line 3. If the result isn't a multiple of
$1,000, increase it to the next multiple of $1,000 (for example,
increase $425 to $1,000, increase $1,025 to $2,000, etc.) . . . . . . . . . . . . . . . .

5.

6. Multiply the amount on line 5 by 5% (.05). Enter the result . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.

7. Is the amount on line 2 more than the amount on line 6?
No. Stop. You can't claim the credit.
Yes. Subtract line 6 from line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8. Enter the total, if any, of:
• One-half of Part V, line 12, self-employment tax plus
• One-half of the Additional Medicare Tax you paid on
self-employment income (Form 8959, line 13 ) . . . . . . . . . . . . . . . . . . . . . . . . . . .

8.

9. Enter the total of any:
• Amount from Part II, line 2, plus
• Employee social security and Medicare tax on tips not reported to employer
from Form 4137 and shown on the dotted line next to Part I, line 6, plus
• Uncollected employee social security and Medicare tax on wages from
Form 8919 shown on the dotted line next to Part I, line 6 plus
• Uncollected employee social security tax and Medicare tax on tips and
group-term life insurance (see instructions for Part I, line 6) shown on
the dotted line next to Part I, line 6, plus
• Amount on Form 8959, line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9.

10. Add lines 8 and 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10.

11. Enter the amount, if any, of Additional Medicare Tax withheld (Form 8959,
line 22) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11.

12. Subtract line 11 from line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12.

13. Enter the amount, if any, from Part I, line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

13.

7.

14. Is the amount on line 12 more than the amount on line 13?
No. Stop. You can't claim the credit.
Yes. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14.

15. Additional child tax credit. Enter the smaller of line 7 or line 14 here and on
Form 1040-SS, Part II, line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15.

tax on all of his or her share of partnership
income.
Community income. Your own
distributive share of partnership income is
included in figuring your net earnings from
self-employment. Unlike the division of

that income between spouses for figuring
income tax, no part of your share can be
included in figuring your spouse's net
earnings from self-employment.

SS-8

Share Farming
You are considered self-employed if you
produced crops or livestock on someone
else's land for a share of the crops or
livestock produced (or a share of the
proceeds from the sale of them). This
Instructions for Form 1040-SS (2016)

applies even if you paid another person
(an agent) to do the actual work or
management for you. For details, see Pub.
225.

Other Income and Losses
Included in Net Earnings
From Self-Employment
1. Rental income from a farm if, as
landlord, you materially participated in the
production or management of the
production of farm products on the land.
This income is farm earnings. To
determine if you materially participated in
farm management or production, do not
consider the activities of any agent who
acted for you. The material participation
tests for landlords are explained in Pub.
225.
2. Cash or a payment-in-kind from the
Department of Agriculture for participating
in a land diversion program.
3. Payments for the use of rooms or
other space when you also provided
substantial services for the convenience of
your tenants. Examples are hotel rooms,
boarding houses, tourist camps or homes,
parking lots, warehouses, and storage
garages. See Pub. 334 for more
information.
4. Income from the retail sale of
newspapers and magazines if you were
age 18 or older and kept the profits.
5. Income you receive as a direct
seller. Newspaper carriers or distributors
of any age are direct sellers if certain
conditions apply. See Pub. 334 for details.
6. Amounts received by current or
former self-employed insurance agents
and salespersons that are:
a. Paid after retirement but figured as
a percentage of commissions received
from the paying company before
retirement,
b. Renewal commissions, or
c. Deferred commissions paid after
retirement for sales made before
retirement.
However, certain termination payments
received by former insurance
salespersons aren't included in net
earnings from self-employment (as
explained in item 10 under Income and
Losses Not Included in Net Earnings From
Self-Employment).
7. Income of certain crew members of
fishing vessels with crews of normally
fewer than 10 people. See Pub. 334 for
details.
8. Fees as a state or local government
employee if you were paid only on a fee
basis and the job was not covered under a
federal-state social security coverage
agreement.
Instructions for Form 1040-SS (2016)

9. Interest received in the course of
any trade or business, such as interest on
notes or accounts receivable.
10. Fees and other payments received
by you for services as a director of a
corporation.
11. Recapture amounts under sections
179 and 280F included in gross income
because the business use of the property
dropped to 50% or less. Do not include
amounts you recaptured on the disposition
of property. See Form 4797.
12. Fees you received as a
professional fiduciary. This may also apply
to fees paid to you as a nonprofessional
fiduciary if the fees relate to active
participation in the operation of the
estate's business or the management of
an estate that required extensive
management activities over a long period
of time.
13. Gain or loss from section 1256
contracts or related property by an options
or commodities dealer in the normal
course of dealing in or trading section
1256 contracts.

Income and Losses
Not Included in Net Earnings
From Self-Employment
1. Salaries, fees, etc., subject to
social security or Medicare tax that you
received for performing services as an
employee, including services performed
as a public official (except as a fee basis
government employee as explained in
item 8 under Other Income and Losses
Included in Net Earnings From
Self-Employment, earlier).
2. Fees received for services
performed as a notary public. However, if
you have other earnings of $400 or more
subject to SE tax, on the dotted line next
to Part V, line 3, enter “Exempt—Notary”
and the amount of your net profit as a
notary public included in line 2. Subtract
that amount from the total of lines 1a, 1b,
and 2 and enter the result on line 3.
3. Income you received as a retired
partner under a written partnership plan
that provides lifelong periodic retirement
payments if you had no other interest in
the partnership and did not perform
services for it during the year.
4. Income from real estate rentals if
you did not receive the income in the
course of a trade or business as a real
estate dealer. Report this income in Part
IV if you and your spouse made an
election to be taxed as a QJV.
5. Income from farm rentals (including
rentals paid in crop shares) if, as landlord,
you did not materially participate in the
production, or management of the
production, of farm products on the land.
See Pub. 225 for details.
SS-9

6. Payments you receive from the
Conservation Reserve Program (CRP) if
you are receiving social security benefits
for retirement or disability. Deduct these
payments on line 1b of Part V.
7. Dividends on shares of stock and
interest on bonds, notes, etc., if you did
not receive the income in the course of
your trade or business as a dealer in
stocks or securities.
8. Gain or loss from:
a. The sale or exchange of a capital
asset;
b. Certain transactions in timber, coal,
or domestic iron ore; or
c. The sale, exchange, involuntary
conversion, or other disposition of
property unless the property is stock in
trade or other property that would be
includible in inventory, or held mainly for
sale to customers in the ordinary course of
the business.
9. Net operating losses from other
years.
10. Termination payments you
received as a former insurance
salesperson if all of the following
conditions are met.
a. The payment was received from an
insurance company because of services
you performed as an insurance
salesperson for the company.
b. The payment was received after
termination of your agreement to perform
services for the company.
c. You did not perform any services
for the company after termination and
before the end of the year in which you
received the payment.
d. You entered into a covenant not to
compete against the company for at least
a 1-year period beginning on the date of
termination.
e. The amount of the payment
depended primarily on policies sold by or
credited to your account during the last
year of the agreement, or the extent to
which those policies remain in force for
some period after termination, or both.
f. The amount of the payment did not
depend to any extent on length of service
or overall earnings from services
performed for the company (regardless of
whether eligibility for the payment
depended on length of service).

Line 1b

If you were receiving social security
retirement or social security disability
benefits at the time you received your
Conservation Reserve Program (CRP)
payment(s), include the amount of your
taxable CRP payment(s) in the total on
line 1b. The amount of these payments is
included in Part III, line 6, and in
information received from farm

partnerships showing your distributive
share.

Lines 4a Through 4c

If both lines 4a and 4c are less than $400
and you have deducted CRP payments on
line 1b, combine lines 1a and 2.
If the total of lines 1a and 2 is $434 or
more, complete Part V through line 4c.
Enter “-0-” in Part I, line 3, unless you also
have church employee income. If you also
have church employee income, see
Church Employees, earlier. Also complete
lines 5a and 5b and the rest of Part V, as
appropriate.
If the total of lines 1a and 2 is less than
$434, do not complete Part V unless you
choose to use an optional method to figure
your SE tax or you have church employee
income. If you have church employee
income see Church Employees, earlier.
Also complete lines 5a and 5b and the rest
of Part V, as appropriate.

Line 8b

If you received tips of $20 or more in any
month and did not report the full amount to
your employer, you must file Form 4137
with Form 1040-SS (see instructions for
Part I, Line 5, earlier). Disregard the
references to Form 1040 shown on Form
4137. Enter on line 8b the amount from
Form 4137, line 10.

Line 8c

If you are an employee who received
wages from an employer who did not
withhold social security and Medicare tax,
you must file Form 8919 with Form
1040-SS (see instructions for Part I,
Line 5, earlier). Enter on line 8c the
amount from Form 8919, line 10.

Part VI—Optional Methods
To Figure Net Earnings

The optional methods may give you credit
toward your social security coverage even
though you have a loss or a small amount
of income from self-employment. But the
optional methods may require you to pay
SE tax when you would otherwise not be
required to pay.
If you are filing a joint return and both
you and your spouse choose to use an
optional method to figure net earnings
from self-employment, you must each
complete and attach a separate Part VI.
You can change the method after you
file your return. That is, you can change
from the regular to the optional method or
from the optional to the regular method.
To do this, file a new Form 1040-SS. See
the instructions under Amended Returns,
later.
Using the optional methods may
TIP qualify bona fide residents of
Puerto Rico to claim the additional
child tax credit or give them a larger credit.

Farm Optional Method

You may use this method to figure your
net earnings from farm self-employment if
your gross farm income was $7,560 or
less, or your net farm profits were less
than $5,457. Net farm profits are the total
of the amounts from Part III, line 36, and
your distributive share from farm
partnerships, minus the amount you would
have entered in Part V, line 1b, had you
not used the optional method.
There is no limit on how many years
you can use this method.
Under this method, report in Part VI,
line 2, the smaller of: two-thirds of your
gross farm income (not less than zero), or
$5,040. This method can increase or
decrease your net self-employment farm
earnings. You can use this method even if
your farming business had a loss.
For a farm partnership, figure your
share of gross income based on the
partnership agreement. With guaranteed
payments, your share of the partnership's
gross income is your guaranteed
payments plus your share of the gross
income after it is reduced by all
guaranteed payments made by the
partnership. If you were a limited partner,
include only guaranteed payments for
services you actually rendered to or on
behalf of the partnership.

Nonfarm Optional Method

You may be able to use this method to
figure your net earnings from nonfarm
self-employment if your net nonfarm
profits were less than $5,457, and also
less than 72.189% of your gross nonfarm
income. Net nonfarm profits are the total
of the amounts from Part IV, line 27, and
your distributive share from other than
farm partnerships.
To use this method, you also must be
regularly self-employed. You meet this
requirement if your actual net earnings
from self-employment were $400 or more
in 2 of the 3 years preceding the year you
use the nonfarm optional method. The net
earnings of $400 or more could be from
either farm or nonfarm earnings or both.
The net earnings include your distributive
share of partnership income or loss
subject to SE tax.
Use of the nonfarm optional method
from nonfarm self-employment is limited to
5 years. The 5 years do not have to be
consecutive.
Under this method, report in Part VI,
line 4, the smaller of: two-thirds of your
gross nonfarm income (not less than
zero), or the amount in Part VI, line 3. But
you can't report less than your actual net
earnings from nonfarm self-employment.
Figure your share of gross income from
a nonfarm partnership in the same manner
SS-10

as a farm partnership. For details, see
Farm Optional Method, earlier.

Using Both Optional Methods

If you can use both optional methods, you
can report less than your total actual net
earnings from farm and nonfarm
self-employment, but you can't report less
than your actual net earnings from
nonfarm self-employment alone.
If you use both methods to figure net
earnings from self-employment, you can't
report more than $5,040 of net earnings
from self-employment.

Completing Your Return
Third Party Designee

If you want to allow your preparer, a friend,
family member, or any other person you
choose to discuss your 2016 tax return
with the IRS, check the “Yes” box in the
“Third Party Designee” area on page 1 of
your return. Also, enter the designee's
name, phone number, and any five digits
the designee chooses as his or her
personal identification number (PIN).
If you check the “Yes” box, you (and
your spouse if filing a joint return) are
authorizing the IRS to call the designee to
answer any questions that may arise
during the processing of your return. You
are also authorizing the designee to:
Give the IRS any information that is
missing from your return,
Call the IRS for information about the
processing of your return or the status of
your refund or payment(s),
Receive copies of notices or transcripts
related to your return, upon request, and
Respond to certain IRS notices about
math errors, offsets, and return
preparation.
You aren't authorizing the designee to
receive any refund check, bind you to
anything (including any additional tax
liability), or otherwise represent you before
the IRS. If you want to expand the
designee's authorization, see Pub. 947.
The authorization will automatically end
no later than the due date (without regard
to extensions) for filing your 2017 tax
return. This is April 17, 2018, for most
people. If you wish to revoke the
authorization before it ends, see Pub. 947.

Signature and Date

Sign and date your return. It isn't valid
unless you sign it. If you are filing a joint
return, your spouse must also sign. If your
spouse can't sign the return, see Pub.
501.
Generally, anyone you pay to prepare
your return must sign it and fill in the Paid
Preparer Use Only area in the space
provided. The preparer must give you a
copy of the return for your records.
Instructions for Form 1040-SS (2016)

Someone who prepares your return but
doesn't charge you should not sign your
return.
If you have someone prepare your
return, you are still responsible for the
correctness of the return.

Daytime Phone Number

Providing your daytime phone number can
help speed the processing of your return.
If we have questions about items on your
return and you can answer our questions
over the phone, we may be able to
continue processing your return without
mailing you a letter. If you are filing a joint
return, you can enter either your or your
spouse's daytime phone number.

Identity Protection PIN

For 2016, if you received an Identity
Protection Personal Identification Number
(IP PIN) from the IRS, enter it in the IP PIN
spaces provided below your daytime
phone number. You must correctly enter
all six numbers of your IP PIN. If you did
not receive an IP PIN, leave these spaces
blank.
New IP PINs are issued every
year. Enter the latest IP PIN you
CAUTION received. IP PINs for 2016 tax
returns generally were sent in December
2016.

!

If you are filing a joint return and both
taxpayers receive an IP PIN, only the
taxpayer whose social security number
(SSN) appears first on the tax return
should enter his or her IP PIN. However, if
you are filing electronically, both taxpayers
must enter their IP PINs.
If you need more information or
answers to frequently asked questions on
how to use the IP PIN, go to IRS.gov/
Individuals/Understanding-Your-CP01ANotice. If you received an IP PIN but
misplaced it, call 1-800-908-4490.
Understanding identity theft issues.
Go to IRS.gov/individuals/the-identityprotection-pin-ip-pin for information and
videos.

Additional Information
Amended Returns

File a new Form 1040-SS to change a
Form 1040-SS you already filed. If you
filed Form 1040-SS but should have filed
Form 1040, file a corrected return on Form
1040. In either case, at the top of page 1
of the corrected return, enter
“CORRECTED” in dark bold letters
followed by the date. Generally, an
amended Form 1040-SS (or Form 1040, if
applicable) must be filed within 3 years
after the date on which the original return
was filed or within 2 years after the tax
was paid, whichever is later.
Instructions for Form 1040-SS (2016)

Interest and Penalties

Do not figure the amount of any interest or
penalties you may owe. We will send you
a bill for any amount due.

Interest
The IRS will charge you interest on taxes
not paid by their due date, even if an
extension of time to file is granted. Also,
you will be charged interest on penalties
imposed for failure to file, negligence,
fraud, substantial valuation
misstatements, substantial
understatements of tax, and reportable
transaction understatements. Interest is
charged on the penalty from the due date
of the return (including extensions).

Penalties
Late filing. If you do not file your return
by the due date (including extensions), the
penalty is usually 5% of the amount due
for each month or part of a month your
return is late, unless you have a
reasonable explanation. If you do, attach a
statement to your return. The penalty can
be as much as 25% of the tax due. The
penalty is 15% per month, up to a
maximum of 75%, if the failure to file is
fraudulent. If your return is more than 60
days late, the minimum penalty will be
$205 or the amount of any tax you owe,
whichever is smaller.
Late payment of tax. If you pay your
taxes late, the penalty is usually 1 2 of 1% of
the unpaid amount for each month or part
of a month the tax isn't paid. The penalty
can be as much as 25% of the unpaid
amount. It applies to any unpaid tax on the
return. This penalty is in addition to
interest charges on late payments.
Frivolous return. In addition to any other
penalties, the law imposes a penalty of
$5,000 for filing a frivolous return. A
frivolous return is one that doesn't contain
information needed to figure the correct
tax or shows a substantially incorrect tax
because you take a frivolous position or
desire to delay or interfere with the tax
laws. This includes altering or striking out
the preprinted language above the space
where you sign. For a list of positions
identified as frivolous, see Notice
2010-33, 2010-17 I.R.B. 609, available at
IRS.gov/irb/2010-17_IRB/ar13.html.
Other. Other penalties can be imposed
for negligence, substantial
understatement of tax, reportable
transaction understatements, filing an
erroneous refund claim, and fraud.
Criminal penalties may be imposed for
willful failure to file, tax evasion, or making
a false statement. See Pub. 17, for details
on some of these penalties.

SS-11

How To Get Forms and
Publications
Visit IRS.gov/forms-pubs to
download U.S. forms and
publications. Otherwise, you can
go to IRS.gov/orderforms to order forms
and publications by U.S. mail. Your order
should arrive within 10 business days.
You can order forms and
publications by calling
1-800-TAX-FORM
(1-800-829-3676) (not toll free in
American Samoa). People who are deaf,
hard of hearing, or have a speech
disability and who have access to
TTY/TDD equipment can call
1-800-829-4059 (not toll free in American
Samoa).
If you have a tax question, check the
information available on IRS.gov or call
1-800-829-1040.
Forms and publications by U.S.
mail. You can order forms and
publications by sending your order

to:

Internal Revenue Service
1201 N. Mitsubishi Motorway
Bloomington, IL
61705-6613

Territory Resources
Addresses of walk-in sites in each territory
and other ways to get forms and
publications are listed below.
Note. The addresses are subject to
change.
American Samoa
American Samoa Government
Tax Office
Executive Office Building
First Floor
Pago Pago, AS 96799
You can order forms and
publications by calling
684-633-4181.
You can order forms and
publications through the fax
684-633-1513.
You can get forms and
publications at
www.americansamoa.gov.
CNMI
Division of Revenue and Taxation
Dandan Commercial Center
P.O. Box 5234 CHRB
Saipan, MP 96950

You can order forms and
publications by calling
670-664-1000.
You can order forms and
publications through the fax
670-664-1015.
You can get forms and
publications at www.cnmidof.net/
rev/forms.asp.
Guam
Department of Revenue and
Taxation
Taxpayer Services Division
P.O. Box 23607
GMF, Guam 96921
You can order forms and
publications by calling
671-635-1840 or 671-635-1841.
You can order forms and
publications through the fax
671-633-2643.
You can get forms and
publications at
www.guamtax.com.
Puerto Rico
U.S. Internal Revenue Service
48 Carr 165 km.1.2
City View Plaza II Bldg.
Guaynabo, PR 00968-8000
You can order forms and
publications, and get tax
assistance, by calling
1-800-829-1040. People who are deaf,
hard of hearing, or have a speech
disability and who have access to
TTY/TDD equipment can call
1-800-829-4059.
You can download U.S. current
and prior forms and publications in
a variety of file formats at IRS.gov/
forms-pubs. Otherwise, you can go to
IRS.gov/orderforms to order forms. Your
order should arrive within 10 business
days.
USVI
U.S. Internal Revenue Service
4008 Estate Diamond–Plot 7-B
Christiansted, VI 00820-4421

You can order forms and
publications, and get tax
assistance, by calling
1-800-829-1040. People who are deaf,
hard of hearing, or have a speech
disability and who have access to
TTY/TDD equipment can call
1-800-829-4059.
You can download forms and
publications, and find tax
information, at IRS.gov/formspubs. Otherwise, you can go to IRS.gov/
orderforms to order forms. Your order
should arrive within 10 business days.
U.S. Internal Revenue Service
Ron De Lugo Federal Building and
Courthouse
5500 Veterans Drive, Room 216
Charlotte Amalie, VI 00802
USVI Bureau of Internal Revenue
6115 Estate Smith Bay
Suite 225
St. Thomas, VI 00802
You can order forms and
publications by calling
340-715-1040.
You can order forms and
publications through the fax
340-774-2672.
You can get forms and
publications at www.vibir.gov.
USVI Bureau of Internal Revenue
4008 Estate Diamond–Plot 7-B
Christiansted, VI 00820–4421
You can order forms and
publications by calling
340-773-1040.
You can order forms and
publications through the fax
340-773-1006.
You can get forms and
publications at www.vibir.gov.
Disclosure, Privacy Act, and Paperwork Reduction Act Notice. The IRS
Restructuring and Reform Act of 1998, the
Privacy Act of 1974, and Paperwork
Reduction Act of 1980 require that when
we ask you for information we must first
tell you our legal right to ask for the
information, why we are asking for it, and
how it will be used. We must also tell you
what could happen if we do not receive it
and whether your response is voluntary,
required to obtain a benefit, or mandatory
under the law.
SS-12

This notice applies to all papers you file
with us, including this tax return. It also
applies to any questions we need to ask
you so we can complete, correct, or
process your return; figure your tax; and
collect tax, interest, or penalties.
Our legal right to ask for information is
sections 6001, 6011, and 7651 and their
regulations. They say that you must file a
return or statement with the IRS and pay
to the United States Treasury any tax for
which you are liable. Your response is
mandatory under these sections. Section
6109 requires you to provide your
identifying number on the return. This is so
we know who you are, and can process
your return and other papers. You must fill
in all parts of the tax form that apply to
you.
You aren't required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records relating
to a form or its instructions must be
retained as long as their contents may
become material in the administration of
any Internal Revenue law.
We ask for tax return information to
carry out the tax laws of the United States.
We need it to figure and collect the right
amount of tax.
If you do not file a return, do not
provide the information we ask for, or
provide fraudulent information, you may
be charged penalties. We may also have
to disallow any deductions shown on the
tax return. This could make the tax higher
or delay any refund, and the calculation of
your social security benefits may be
affected.
Generally, tax returns and return
information are confidential, as stated in
section 6103. However, section 6103
allows or requires the IRS to disclose or
give the information shown on your tax
return to others as described in the Code.
For example, we may disclose your tax
information to the SSA for use in
calculating your social security benefits; to
the Department of Justice, to enforce the
tax laws, both civil and criminal; and to
cities, states, the District of Columbia, and
U.S. commonwealths or possessions to
carry out their tax laws.
We may disclose your tax information
to other persons as necessary to obtain
information needed to determine the
amount of or to collect the tax you owe.
We may disclose your tax information to
the Comptroller General of the United
States to permit the Comptroller General
to review the Internal Revenue Service.
We may disclose your tax information to
Committees of Congress; federal, state,
and local child support agencies; and to
other federal agencies for the purposes of
Instructions for Form 1040-SS (2016)

determining entitlement for benefits or the
eligibility for and the repayment of loans.
We may also disclose this information to
other countries under a tax treaty, or to
federal and state agencies to enforce
federal nontax criminal laws, or to federal
law enforcement and intelligence
agencies to combat terrorism.
Keep this notice with your records. It
may help you if we ask you for other
information. If you have questions about
the rules for filing and giving information,
call or visit any IRS office.

Recordkeeping . . . . . . .
Learning about the law or
the form . . . . . . . . . . .
Preparing the form . . . . .
Copying, assembling, and
sending the form to the
IRS . . . . . . . . . . . . . .

. .

5 hr., 27 min.

. .

1 hr., 10 min.
3 hr., 47 min.

. .

. .

1 hr., 03 min.

The time needed to complete and file
this form will vary depending on individual
circumstances. The estimated average
time is:

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler,
we would be happy to hear from you. You
can send us comments from www.irs.gov/
forms-pubs. Click on “More Information”
and then on “Give us feedback.” You can
write to the Internal Revenue Service, Tax
Forms and Publications, 1111 Constitution

Instructions for Form 1040-SS (2016)

SS-13

Ave. NW, IR-6526, Washington, DC
20224. Do not send the form to this
address. Instead, see Where To File in the
General Instructions, earlier.
We respond to many letters by
telephone. Therefore, it would be helpful if
you would include your daytime phone
number, including the area code, in your
correspondence.
Although we can't respond individually
to each comment received, we do
appreciate your feedback and will
consider your comments as we revise our
tax products. We can't answer tax
questions sent to the above address.