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[Timo]

I'm self-employed and get paid on 1099. My wife is a W2 employee. When
filling out the CSS financial aid profile, we were asked how much we
paid in taxes on line 56 of the 2004 fed 1040 return. That is, what she
paid. But we were not asked to supply the amount of self-employment tax
that I paid (1040, line 57), which was considerably higher. I don't see
anywhere on the CSS Business/Farm supplement to include my
self-employment tax. How is that tax amount paid information used, and
it is important that I include it somewhere?
Thanks
Timo

[Steve Blank]

Timo,

Line 56 isn't what was withheld from your wife's pay, but is the actual
income tax on your joint total income, including your income from the
business.

Line 57, self-employment tax, is the social security taxes on your
self-employment income.

The Profile formula (and the FAFSA as well) account for SS taxes based
on the answers you give to the questions about income from work - your
wife's wages and your business profit. They then compute the SS taxes as
a percentage of those answers. That's why they don't ask on the
Business/Farm supplement.


Steven B. Blank
College Financial Aid Consultants
29 Ives Hill Court
Cheshire, CT 06410
(203)250-7761