IRS Publication 334 — Tax Guide for Small Business (Schedule C)
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“The 2025 SE tax rate on net earnings is 15.3% (12.4% social security tax plus 2.9% Medicare tax).”
You can generally use any combination of cash, accrual, and special methods of accounting if the combination clearly shows your income and expenses and you use it consistently. However, the following restrictions apply.
• If an inventory is necessary to account for your income, you must generally use an accrual method for purchases and sales. (See, however, Inventories, later.) You can use the cash method for all other items of income and expenses.
• If you use the cash method for figuring your income, you must use the cash method for reporting your expenses.
• If you use an accrual method for reporting your expenses, you must use an accrual method for figuring your income.
• If you use a combination method that includes the cash method, treat that combination method as the cash method.
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